Attracting and Keeping Diverse Planners and Clients

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CNBC reported more than a year ago that there are not enough financial planners to meet the demand for services needed from consumers who want to plan more thoroughly.

“We do have a gap in our profession because many advisers are retiring and the pipeline isn’t keeping up with the pace of those aging out of the workforce,” Shannon Pike, CFP®, vice president at Tanglewood Legacy Advisors in Houston and past president of the Financial Planning Association, told CNBC.

Things haven’t changed much.

Financial Advisor Magazine reported that in 2014, 43 percent of planners were nearing retirement. It’s four years later and those planners are even closer.

Attracting diverse planners to the profession is not about pushing out qualified individuals for underqualified people, it’s about filling the giant hole that is about to open up with qualified, talented people who are being wooed by other professions also.

Cy RichardsonTo attract diverse talent, the profession has to up its game, Cy Richardson, senior vice president of the Urban League told Rianka R. Dorsainvil, CFP®, in an episode of the podcast 2050 TrailBlazers. Other professions—like law and medicine—are also throwing their hats in the recruitment ring, Richardson said.

And since this is a profession where people can do “both well and good,” Richardson said, they will no doubt be attracted to it.

Richardson and Dorsainvil dive into the following aspects in examining how the financial planning profession can better attract and retain diverse planners and clients.

And if you’re wanting to fill the gap with diverse talent, here are some things you can do.

Respect cultures. There may be a misconception that the financial planning profession is all about numbers, Dorsainvil said.

“Numbers are involved, but being a financial planner is all about relationship-building,” she said. “It is about learning your clients so that’s why culture is very important working with, for example, an African client and understanding that the eldest son is typically responsible for the parents.”

She elaborated that if you do have a client from this background, there may be a line item that is a few thousand dollars for parents that is non-negotiable. So attempting to get this particular client to do away with that $2,000 line item might be considered offensive.

If you are already attracting clients from different backgrounds, Dorsainvil and Richardson said it’s imperative to know and understand their cultural values to keep them.

Richardson added that some families might have multiple generations living in one household.

“The obligation of any member of [that] household may not necessarily fit traditional, mainstream American values in terms of the patriarchal male-dominant of the house,” Richardson added. “You may have a female head of household or multiple female heads of the household.”

Journal Columnist Meir Statman, who immigrated to the United States from Israel, wrote a column about this very topic for the August issue, which offers more intricate insight on cultural differences and how they tie into your practices.

“There are so many different nuances that we need to become culturally aware so that we can be able to serve our clients best,” Dorsainvil said.

Be better at building relationships. Knowing how to make both client prospects and people who are new to the profession feel welcome is another key ingredient to attracting and retaining them both.

Richardson said the diverse talent you hire will most likely be adept at this skill and would likely make a valuable addition to your staff.

“A planner who understands the contextual forces at work and has more than just the cookie-cutter approach to consumers and building relationships and making people feel comfortable, that is a particular skill set for communities for color, for planners of color, because we’ve had to do it our whole lives in terms of making ourselves comfortable in majority settings, in making other minority folks feel comfortable in majority settings,” Richardson said. “That kind of resilience is built into our DNA. Why not direct that experience towards a profession that requires it?”

Work on listening and empathy skills. The power of listening isn’t new to our readers. At the FPA Annual Conference in Baltimore, Eric Maddox, an interrogator who was the mastermind behind Saddam Hussein’s capture, told us that listening is the foundation to building trust in any relationship.

“First and foremost, you must listen,” Maddox told the Journal in 2016. “Listening is not an art; it’s a learned skill.”

But developing these skills can help both with your clients and your new hires and will make them feel comfortable to share and make them feel safe, Richardson said.

Maddox also told us back in 2016 that, “Empathy is to listening as water is to the human body. It’s everything.”

“We need to make those skill sets compulsory parts of this profession,” Richardson said. This not only helps in “meeting prospects where they are but ensuring the profession can be adaptable to prospect desires.”

Dorsainvil said this profession should be an attractive option for communities of color.

“For those who are saying, ‘Is this a career path for me?’ Absolutely,” Dorsainvil said.

Why Is This Issue Important?

By the year 2050, what are considered minority groups today are projected to become the majority. Numerous studies show that authentically recruiting and retaining people from different backgrounds with unique perspectives helps companies’ bottom lines.

Dorsainvil reports from a recently released press release from CFP Board that just over 3 percent of all CFP® professionals are people of color. And if the world is poised to change so drastically by 2050, the profession will benefit from recruiting and retaining professionals of color as well as learning how to serve these communities.

About the 2050 TrailBlazers Podcast

Dorsainvil began streaming episodes of 2050 TrailBlazers in March 2018. FPA is one of the sponsors of the podcast that is sparking conversation on diversity and inclusion in the financial planning profession and attempting to address issues of recruitment and retention of professionals of color.

This podcast highlights ways to increase diversity in the financial planning profession. Listen to the podcasts during your commute and check out the show notes for more information about the people and topics covered. Subscribe on iTunes and Google Play or visit the website.

Interested in the FPA Diversity Scholarship? Apply today to be considered.

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Ana Trujillo Limón is associate editor of the Journal of Financial Planning and the editor of the FPA Practice Management Blog. Email her at Follow her on Twitter at @AnaT_Edits.

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