A reported dip in engagement with financial advisors by diverse Americans in 2022 appears to be reversing.
Last year Allianz Life reported that just 24% of Black investors and 35% of Hispanic investors had a professional financial advisor, dropping from 38% and 44% respectively in 2021.
However, new stats for 2023 reveal that 36% of Black Americans and 42% of Hispanic Americans are working with a financial advisor now and this aligns with a rise in confidence among these groups that their finances are in shape to support life goals and ambitions (80%).
The survey shows that there is still work to do across all groups to dispel some myths around working with a financial advisor.
For those that are not currently getting professional financial advice, around 3 in 10 believe they don’t have enough money to warrant it, around 15% do not trust financial advisors, and around one third think it costs too much (this rises to 46% among Asian American respondents).
While personalized advice is always going to be preferred, the varying demands of various diverse groups of Americans should be noted.
For example, 38% of Black and Hispanic Americans list “paying off credit card debt” as one of their top three financial goals, compared to 30% of the total population, while 45% of the total population say “saving enough and making plans to live a comfortable retirement,” is one of their top three financial goals, only 36% of Black Americans say the same, and 31% of Black Americans say “leaving a legacy for my family” is one of their top 3 financial goals, compared to 23% of the total population.
“The data are telling us that one size does not fit all when it comes to what people are looking for in financial advice,” said Walker. “Now more than ever, it’s critical for financial professionals to approach their clients with an open mind and really listen to their concerns. That’s how we help make financial guidance work for everyone.”
The survey also revealed topics that Americans of color would like to discuss with a financial advisor but do not:
“These results show the need for a more holistic approach to providing financial planning strategies,” said Walker. “By definition, that means getting to know your clients better, and using a planning process that takes into account life needs that might fall outside the realm of traditional retirement strategies.”
Survey respondents that do not currently work with an advisor said one of the things that would encourage them to do so is an advisor with “similar characteristics to me such as similar age, gender or race.”
This highlights a challenge for the financial services industry to broaden the pipeline of talent.
“One of the ways we bring more people of color into our client population is to bring more people of color into the career of financial professional,” says Walker. “There are a variety of industry-wide efforts to do so, and our success in these efforts will go a long way toward creating a more inclusive market for financial guidance.”
Public support grows for policies that spread AI’s financial gains beyond tech companies.
Investment banking fees rose 30% on a wave of IPOs and megadeals, led by the largest public listing on record.
Series A funding from Portage, Bain Capital, and other investors will fuel data tools designed to speed advisor transitions and cut onboarding delays across wealth firms.
The Minneapolis-based RIA aggregator is adding two North Carolina practices managing nearly $1 billion, pushing its total client assets past $158.2 billion.
As markets disintegrate, the value of on-the-ground, first-hand research through "intimate knowledge acquisition" is skyrocketing.
Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income