Money pride: Building financial confidence in the LGBTQ community

Collectively, the LGBTQ community has mega-watt buying power. One study in 2019 estimated that people who identify as lesbian, gay, bisexual, transgender and/or queer spend $3.7 trillion in the global economy every year.1

On an individual basis, however, the financial picture isn’t always so positive. In the United States alone, gay people still face costly issues like pay inequality, especially among women, and housing discrimination.2,3 Plus the very foundation of LGBTQ life can be more expensive.

Hiram Arnaud, a financial advisor with Strategies for Wealth, is well-versed in the intersection of gay life and financial confidence. He’s quick to note that every person contains “a multitude of layers,” and he works with people from a vast range of backgrounds. Within his own multitude, Hiram is a gay man, and with his husband, a father to two young children. We asked Hiram to share his perspective on how the LGBTQ community can thrive in their financial lives. Here he is, in his own words:

Money is often a taboo topic. How do you address this with your LGBTQ clients?

Unfortunately, talking about money is a taboo across the board. Think about it, how many times do you actually talk to your friends about money? But then on top of that, in the LGBTQ community, it’s a taboo because we have a tendency of trying hard to fit in.

People often try to fit in by buying things. Everyone wants to have a nice house, a nice car, and brand name clothes. But they don’t talk about how much debt they’re taking on to get these things. They only want to talk about the side that looks good.

When I work with LGBTQ clients, we talk about how to overcome this mentality. Most of us in the LGBTQ community faced challenges when we came out. Then society throws in advertising and marketing that promotes overspending on things you don’t need. To a certain extent, our community has been encouraged to buy our happiness. So the first thing I say is this is not their fault.

What does a new money mentality look like?

If you think back to your grandparents or your parents’ relationship with money, you’ll probably see that it wasn’t great. If anything, they talked about money as something bad or negative. Maybe they referred to money as something they lacked or from a place of discomfort. Money was never something fun.

I want to help people shift this paradigm. Have you ever heard someone say, “I am so happy I just spent $10,000 on the best trip of my life. It brought me so many learning experiences and joy.”? Now this is a new way to talk about money.

In my house, we talk about money like we talk about a good book or a movie. And I tell my clients to do the same thing. I encourage them, “You have to come out of the closet again” – and this time it’s about money.

It’s okay to say to your friends, “I’m not going out this weekend because I recently went above my budget. Why don’t we have a bottle of wine at my house?”. Sometimes we have to experience a little bit of discomfort now in order to allow our future selves to be comfortable.

How do you help people build an LGBTQ-Friendly portfolio?

I’m happy to say that people who work with a financial professional are in a good position [to build an LGBTQ-friendly portfolio]. Nowadays there are excellent resources, such as the Human Rights Campaign Foundation’s Corporate Equality Index. With this free list, you can actually see which companies are aligned with your values. You can create an investment portfolio from there, and it will be backed by research and data.

Financial professionals now have all sorts of resources to help people invest in what’s important to them, from LGBTQ issues, socially-responsible investing, green funds and more.

What financial products do you recommend for LGBTQ individuals specifically?

I don’t think there are good or bad products. I think there are good strategies that encompass certain products within them. It really depends on the person, LGBTQ or not.

But in talking about financial products, there are two that I believe are very important. The first one is long-term care insurance. We are living in an era of health and medical advances. People are living longer, and the cost of assisted living is expensive. It can easily run up to $10,000 a month. As a result, long-term care insurance is going to be a necessity. This is especially true for people when they don’t have kids who can or who are willing to care for them in their later years.

The second product is long-term disability. Again, we are living longer now. This also means there is a greater possibility of becoming disabled due to the longer time period. When you have long-term disability insurance, you help protect your income. And like all insurance products, the younger you get it, the better.

Any last thoughts you’d like to share with LGBTQ readers?

Remember: we are a very powerful and brave community. We’ve paved the way for so many things. Let’s not be scared to raise our hand in regards to finance. Sometimes people say, “Oh, money is not my forte,” and they walk away from it. But if we can actually take a stand in creating our individuality, then we can take a stand in building our financial lives, too.

I want money to be a light so people can create the lives of their ambitions. Because at the end of the day, that’s real freedom.

Are you ready to thrive in your financial life? A financial professional can help you make a plan to help you reach your goals and protect yourself and your loved ones. Speak to one today.

 

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2021-123230 Exp. 6/2023