It’s not hard to recognize that the financial advising world has long been dominated by a particular subset of the population. Men, particularly white men, have been the default in much of the financial world and, in particular, wealth management. As time has passed, industries invested in helping all people build wealth should become more reflective of the populations that they serve.
If you’re considering starting an RIA or you are already running one, it’s important to think of the clients that you may eventually serve. Underrepresented groups, such as minorities and women, should be given special consideration in your firm, not merely because of their gender or race, but also because it will help your firm stand the test of time.
Building Trust and Understanding
For instance, women, on average, outlive men. Practically speaking, many widows will be left in charge of their estates after the passing of their husbands. Similarly, prenuptial agreements have already split out the assets of a household following a divorce or death. These women may prefer having a female advisor to develop their wealth strategy and accomplish their monetary goals.
Likewise, different cultures value different things and will then in turn have different goals for how their wealth should be utilized into the future. While race and culture aren’t necessarily inexorably linked, it’s not hard to imagine that having an advisor from the same background or at the very least a cultural understanding of a client’s background will allow them to accomplish the specific goals of an investor.
The Power is Yours
It’s always important to pick the right person for the job, regardless of who they are or what they represent. However, if you’re starting a wealth management firm, or helping one mature, you have the power to reach out to who you want to collaborate with. If it’s your desire to create an inclusive and diverse firm, then it starts with you making the moves to build the advisory group that represents the population as a whole.
It’s never been easier to hire or recruit those that will diversify your space. Thousands of women and minority advisors enter the financial planning industry every year, but ultimately, it comes down to you, what you value, and how you want your clients to see your firm. The value to your clients and to your business may depend on what steps you take to build an inclusive firm.
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