Despite Overall Optimism, Financial Awareness Gap Still High for LGBT Investors, According to Wells Fargo Survey

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Despite Overall Optimism, Financial Awareness Gap Still High for

LGBT Investors, According to Wells Fargo Survey

Increased Education Remains Critical

SAN FRANCISCO, March 4, 2013 LGBT investors indicate high levels of post-election optimism about the political and economic direction of the country, as well as confidence about their own financial future, according to a recent Wells Fargo nationwide survey. LGBT investors also show a great deal of optimism around the future of same-sex marriage and civil unions. The picture is not entirely rosy, however. Despite steps toward retirement preparation, LGBT investors remain concerned about saving enough for retirement, and there continues to be underlying confusion about transfer rights and benefits for same-sex couples.

Two-thirds (66%) of LGBT investors are optimistic about the political direction of the country, compared with 43% of the overall population. Three in four expect a stronger US economy over the next two years, much higher than the general population of 47%. And two-thirds (65%) anticipate stronger local economies over the next two years, compared to 45% overall.

LGBT investors are more positive regarding their current financial situation than the general public. Three in five (59%) report they feel financially comfortable, compared to 51% of all US adults. Two-thirds (66%) are confident in their financial future versus 52% of US adults. LGBT adults are also more likely to report being better off financially then they were three years ago (65%), compared to 51% of all adults. And two thirds (66%) feel secure in their current job situation, higher than US adults (55%).

“While optimism and confidence among LGBT investors remain high, there is clearly an awareness gap related to the very complex financial issues facing same-sex couples,” said Kyle Young, Financial Advisor and Vice-President, Investment Officer in the Short Hills, New Jersey office of Wells Fargo Advisors. “Lack of Federal recognition of same-sex couples adds many layers of challenges to retirement and estate planning for all LGBT couples. Proper analysis and planning that comes with a financial advisor who understands the landscape of today’s differing state-by-state approaches is essential.”

LGBT adults appear to be taking more steps to better save and prepare for retirement. On average, non-retired and retired LGBT adults report higher median net savings than the overall population. Over half of LGBT non-retirees (55%) report having a detailed retirement savings plan in place, compared to 42% of all adults. These LGBT respondents are more likely to have developed plans with a paid financial advisor (42%) while an additional 22% used web-based tools and calculators to assist in the process.

Nevertheless, concerns remain. Many LGBT respondents are concerned about saving enough for retirement (53%), and only 55% are confident they will be able to afford their current lifestyles in retirement. In a list of financial concerns, “saving for retirement” was the top concern for pre-retired LGBT respondents at 38%, followed by healthcare costs (18%) and paying monthly bills (16%).

LGBT adults with children consistently report more financial challenges, including preparing for retirement, than LGBT adults without children. LGBT with children feel less financially comfortable than those without (42% vs. 61%), and reported less confident in their financial future (40% with children vs. 68% without). LGBT with children are also twice as likely to report that high living expenses are limiting their ability to save for the future (51% with children vs. 26% without).

Almost all LGBT adults (92%) believe that within their lifetime, federal laws on survivor rights and benefits will become the same for same-sex couples as they are for heterosexual couples. Nearly half (43%) believe this will happen within the next three years, while 22% believe it will happen in the next four or five years.

Despite heightened attention to same-sex marriage and civil unions, tremendous confusion remains around transfer rights and benefits for same-sex couples. Nearly half (44%) of LGBT respondents did not know that Social Security income and benefits are not transferable to the spouse or partner in a same sex couple. Similarly, fewer than half (41-47%) of LGBT respondents correctly answered that other assets and benefits like real estate (47%), life insurance (44%) and retirement savings (41%) may be transferable depending on the state in which the same-sex couple resides. Only 36% of LGBT adults know that Federal taxes on survivor assets or benefits are different for the spouse/partner in a same-sex marriage than in a heterosexual marriage.

Wells Fargo Advisors Accredited Domestic Partnership Advisor (ADPA) Program

The Accredited Domestic Partnership Advisor (ADPA) program was created, through a partnership with the College for Financial Planning, to educate advisors about the unique needs and financial considerations of domestic partners. Financial advisors who earn this designation are well-equipped to work with domestic partners and lesbian, gay, bisexual, and transgender (LGBT) clients to develop a thoughtful approach to meeting their financial goals. Wells Fargo Advisors created ADPA in conjunction with the College for Financial Planning. Today, Wells Fargo Advisors has more than 100 ADPA-certified financial advisors nationwide, more than any other firm in the country.

About the Study

These survey findings are based on an online survey conducted November 9 December 3, 2012 among adults nationwide (N=1,105) and LGBT adults (N=606). Qualified respondents were non-students, ages 25-75, who are the primary or joint financial decision-maker in the household with household investable assets of at least $10,000. Survey results are weighted to reflect Census data for gender, age, race/ethnicity, region and household income to ensure representativeness. Assuming no sample bias, the maximum margin of error for the National sample is 2.9% and 4.0% for LGBT.

About Richard Day Research, a Market Probe company

Market Probe is a full-service market research firm, headquartered in Milwaukee, WI, with offices in Evanston, IL, specializing in behavioral and opinion research among hard-to-reach populations and professional communities. For more information, visit marketprobe.com.

About Wells Fargo Wealth, Brokerage and Retirement

Wells Fargo Wealth, Brokerage and Retirement (WBR) is one of the largest wealth managers in the U.S. WBR includes Wells Fargo Advisors, the third-largest brokerage in the U.S.; Wells Fargo Private Bank, serving high-net-worth individuals and families; Abbot Downing, serving ultra-high-net-worth families; and Wells Fargo Retirement, which manages $266 billion in institutional retirement plan and pension assets for 3.7 million Americans. Wells Fargo Advisors is the trade name used by two separate registered broker-dealers and non-bank affiliates of Wells Fargo & Company: Wells Fargo Advisors, LLC, and Wells Fargo Advisors Financial Network, LLC (members SIPC).

About Wells Fargo (Twitter @WellsFargo)

Wells Fargo & Company (NYSE: WFC) is a nationwide, diversified, community-based financial services company with $1.4 trillion in assets. Founded in 1852 and headquartered in San Francisco, Wells Fargo provides banking, insurance, investments, mortgage, and consumer and commercial finance through more than 9,000 stores, 12,000 ATMs, the Internet (wellsfargo.com), and has offices in more than 35 countries to support the bank’s customers who conduct business in the global economy. With more than 265,000 team members, Wells Fargo serves one in three households in the United States. Wells Fargo & Company was ranked No. 26 on Fortune’s 2012 rankings of America’s largest corporations. Wells Fargo’s vision is to satisfy all our customers’ financial needs and help them succeed financially.

Note: Complete survey results are available upon request.

Media:

Matt Hurwitz

415-396-6964

Matthew.s.hurwitz@wellsfargo.com

Sarah Tonigan

505-818-7480

Sarah.h.tonigan@wellsfargoadvisors.com

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