By Chris Davis
This article provides information and education for investors. NerdWallet does not offer advisory or brokerage services, nor does it recommend or advise investors to buy or sell particular stocks or securities.
In 2020, the number of Black and Latino certified financial planners in the U.S. grew 12.6% from the previous year — certainly good news. The more sobering statistic from the CFP Board is that there are still only 1,493 Black CFPs today, and they make up less than 2% of all CFP professionals.
“That’s just too few CFPs,” says Lazetta Rainey Braxton, a certified financial planner and co-founder and co-CEO of 2050 Wealth Partners.
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Braxton is among that group of Black CFPs, and she’s enthusiastic about raising awareness of and solving a twofold problem: We need more Black CFPs, and we must improve access to financial planning services. And to Braxton, this isn’t an “either/or” situation. The solution is undoubtedly a “both/and” approach.
Why Finding a Black Financial Adviser Matters
Braxton says some of her Black clients have expressed that a Black adviser may better understand small cultural nuances that could have big economic impacts.
“That adds a degree of trust, that they understand where you’re coming from, will listen to you and then make suggestions according to that deep understanding,” Braxton says. “Often clients may wonder, ‘Who can help me? There’s not a lot of Black advisers, and there aren’t white advisers who understand what’s going on with me.’”
For such a client, the embedded trust and familiarity of having a Black adviser could mean the difference between seeking out financial advice and forgoing it. However, Braxton makes clear that this can’t be a blanket statement.
“I also know that there are Black clients who may not prefer a Black adviser,” she says. “They just want to be served well like any other client would be served.”
So the argument, she says, isn’t necessarily that we need more Black CFPs because that’s what Black clients are looking for. We need more Black CFPs so clients have options for any preference they may have when they start looking for an adviser, she says.
Why Finding a Black Financial Adviser Matters to White Allies, Too
Braxton summed up in a single word why it’s also important for white allies to consider Black advisers: intentionality.
“If you’re intentional about being intentional and getting out of your comfort zone, then yes, you should open yourself up to other service providers,” she says. “That takes effort.”
Braxton says she’s had white clients who intentionally spend their money with her firm for social impact. She recalled yet another client who said (and who worried their comment might sound strange) that they wanted to work with a Black woman. And to both these instances, Braxton responded optimistically.
“There’s nothing strange about this,” she says. “What we’re building is an alternative that can only happen if there are clients who believe in what we’re doing.”
But this goes beyond just supporting Black businesses for social impact. If you’re looking for someone to define and implement your financial goals but your search is confined to the traditional majority, you could be missing out on top-notch financial expertise.
How to Find a Black Financial Adviser
Chris Woods, chair of the Financial Planning Association’s Diversity and Inclusion Committee, says you don’t have to compromise on qualifications or personal preference in any way, shape or form to find a Black adviser. Whether you’re looking for a certain designation such as CFP, registered investment adviser or broker-dealer; years of experience; a particular payment model; or any other preference, he says, you’ll find a Black adviser who can meet that criteria.
“Qualified Black financial advisers are everywhere,” says Woods, who is a certified financial planner and founder of LifePoint Financial Group. “It’s just a matter of people searching for the adviser for them.”
So how do you find a Black financial adviser? The best place to start your search is the Association of African American Financial Advisors’ Find a Financial Advisor tool. Once you fill out your contact information, you’ll enter your ZIP code and indicate any specialties you may be looking for, such as comprehensive financial planning, insurance, investment management, inheritance or taxes.
One of the best parts about this tool is the “Virtual Advisement” option. If there’s no Black financial adviser in your area, no problem. Check the Virtual Advisement box, and you’ll see a list of Black advisers who will meet with you virtually — a development in the world of financial planning that Braxton says could truly bring down barriers to financial advice. A client in Dallas could work with a CFP in New York, receiving financial advice in the comfort of their own home.
Beyond that, Braxton says it’s becoming more commonplace for financial planning firms to post pictures and bios of their advisers, and some are even offering details on the demographics and populations their advisers tend to serve most. When sifting through advisers, feel free to get in touch with the firm to ask if these details are available. (A good place to start may be NerdWallet’s roundup of the best financial advisers.)
It may also be helpful to look into financial planning networks and firms with an outward commitment to diversity, equity and inclusion. Harness Wealth, for example, updated its vision and values in 2020 to include DEI initiatives and committed to publicly disclosing representation among employees and clients as the company grows. It’s firms like this and Braxton’s 2050 Wealth Partners that are providing access to more diverse CFPs while bulldozing barriers that have existed for far too long.
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Chris Davis writes for NerdWallet. Email: firstname.lastname@example.org.