Navigating Retirement Planning for Transgender Clients: 5 Key Considerations for Financial Advisors
As the LGBTQ+ community continues to grow and become more visible, financial advisors are increasingly encountering transgender clients in their practices. While retirement planning for these individuals may not fundamentally differ from that of others, there are unique considerations that advisors must keep in mind to ensure a smooth and respectful process.
First and foremost, advisors should be aware that for pre-transition or in-transition clients, the focus on retirement may not be a priority. Many trans people pre-transition are constantly thinking about transition, and so they cannot think longer term because it's constantly on their mind. This emotional and mental strain of transitioning can make it difficult for them to plan for retirement.
In addition to the emotional and mental strain of transitioning, potential relocation costs can also be a significant consideration for many trans clients. As the climate of transphobia increases, there are more people who are leaving their communities to find a place where they can legally exist. Some clients may even consider leaving the country due to the increasing transphobic climate federally.
For pre-transition clients, financial planning can involve a variety of considerations beyond gender-affirming surgeries. Transitioning can often result in divorce for married clients, and depending on the types of medical procedures a client would like to have, it can involve job disruptions or even necessitate career changes. As a financial planner, the goal is to help a person come up with a game plan for how to go through this transition. This can be a very specific and sensitive process that requires a deep understanding of the client's needs and circumstances.
Even well-intentioned advisors can make mistakes when it comes to using a trans client's chosen name and preferred pronouns. Learning to use the singular gender-neutral pronoun "they" can be like learning a second language for those who don't interact with many trans or nonbinary people in their daily life. Advisors should set aside time to practice using these pronouns and firms should build support for trans clients into their infrastructure by creating space for things like chosen names and pronouns on a client's profile.
It's important to remember that trans clients are three-dimensional people, and well-intentioned allyship can go too far if an advisor ends up attributing everything about a client to their identity as a transgender person. An advisor who is overly focused on their client's trans identity could listen to that client talk about a disagreement with a family member and automatically assume that the conflict has to do with them being trans, even if that's totally irrelevant to the situation. It's important to remind oneself to view the person as a whole person and not just their trans identity.
Planning for retirement with trans clients is often more of an imagination issue than a financial one. For pre-transition clients, thinking about retirement can be especially difficult, but even for clients who have already transitioned, it can be difficult for them to see themselves growing old and needing retirement funds. It's important for advisors to be patient and understanding in this process, and to provide a safe and supportive environment for their clients to navigate this challenging time in their lives.
