Financial advisors are charged with helping clients understand the financial implications of key decisions. Lorraine Johnson, President of Triangle Financial Advisors, shares how to talk with same-sex clients about marriage.
Now that the U.S. Supreme Court has legalized same-sex marriage, these couples are being asked more frequently, “Are you getting married?”
All same-sex couples are not affected by this ruling in the same way. While there are clearly financial implications of making their unions official, this does not mean all couples are taking that step. Personal, family, and/or financial considerations come into play for many. Even if there are compelling tax, legal, or Social Security advantages, those may not be enough for couples to decide to get married. Financial advisors must understand their clients’ views on marriage so they can help them effectively manage their money, regardless of their decision.
Many financial advisors are wondering how to approach this topic with their same-sex clients or prospects with grace, openness, caring, and transparency. Financial advisor Lorraine Johnson, President of Triangle Financial Advisors in Raleigh, North Carolina recently shared her insights on this key topic in an interview with the Wall Street Journal.
Following the couples’ lead on this topic is important. For example, if the couple is recently married and excited about it, be excited too. If the topic of marriage for same-sex couples is uncomfortable for you, consider referring the couple to an advisor who specializes in serving non-traditional families.
Johnson has found certain phrases helpful to get the conversation started. “For instance, try, ‘I don’t want to make any assumptions, but … .’ Once the conversation starts moving, ease any tension by responding with, ‘This is not uncommon’ or ‘You are not alone on this.’ ” As a trusted professional partner, creating the space and opportunities to openly communicate and help clients sort through the concerns and issues is critical.
Johnson goes on to share a few examples that are representative of what many advisors are seeing with their same-sex clients right now.
Many gay and lesbian couples have created their own ways of handling their finances. For instance, couples may have a joint checking account for paying household expenses but have separate accounts for expenses like vacations, cars, and eating out.
Couples may also be weighing the tax implications of getting married, knowing that their combined income will be subject to a higher tax bracket. The question may arise, “Who will cover the increased tax bill?” It may be that the overall tax bill will go up by $2,000. There is a disparity in individual incomes, and the tax brackets are different. The tax due for one will be $3,000 higher than when filing as single, but the other will owe $1,000 less. Does the one who pays less cover the $2,000 net difference or is this expense split?
Johnson’s last piece of advice to financial advisors is this: “Same-sex couples need objective information, not assumptions or judgement. They need to feel that you care and will help them make the right decisions for their specific circumstance.”
Securities and investment advisory services offered by Royal Alliance Associates, Inc., member FINRA/SIPC. Insurance services offered through Triangle Financial Advisors, LLC and are not affiliated with Royal Alliance Associates, Inc.
About Triangle Financial Advisors and Lorraine Johnson
Triangle Financial Advisors puts their 25 years of experience to work every day by creating personal wealth plans that reflect the unique goals and interests of every client.
Helping clients safeguard the financial future they envision requires developing a comprehensive approach that keeps things on track and personal attention that offers peace of mind.
The office is conveniently located at 2301 Rexwoods Drive, Suite 100, Raleigh, NC 27607.
To learn more about Triangle Financial Advisors, visit http://www.trianglefa.com/
Company Name: Triangle Financial Advisors
Contact Person: Lorraine Johnson, President
Country: United States