Diversity among financial planners improved in 2021 – but it still lags behind
The Good Brigade | Digital Vision | Getty Images
Diversity among financial planners has improved in 2021, though the industry remains one that leans heavily toward white males, according to statistics released Wednesday by the Certified Financial Planner Board of Standards.
The group, which issues the Certified Financial Planner designation, has seen a pronounced increase in the number of female, black and Hispanic practitioners in the past year. The number of black financial planners has increased by more than 10% compared to 2020; the growth rate was 15% for Hispanic CFPs and 4.2% for women.
Learn more about personal finance:
Watchdog reports sweeping crackdown on hidden fees at banks
Millions are still waiting for last year’s tax refund
SEC Chairman considers tougher cyber rules to protect against hacks
All outpaced the overall CFP growth rate, which reached an all-time high of 92,055, a 3.8% increase from 2020.
“2021 is the largest and most diverse class in the history of the CFP Board,” said Kamila Elliott, chair of the group’s board of directors.
Despite last year’s improvements, officials acknowledge that current measures are still insufficient.
There were 76,435 white financial planners in 2021, or about 83% of the total – dwarfing other racial and ethnic groups.
About 4%, or just over 3,600, of CFPs are Asian or Pacific Islander; nearly 3% (about 2,500) are Hispanic or Latino, and more than 1,600 (nearly 2%) are black or African American.
By comparison, the US population is about 76% white, 19% Hispanic or Latino, 13% black or African American, and 6% Asian, according to Census Bureau data.
Meanwhile, nearly 77% of CFPs are men and 23% are women, according to the CFP Board. (Women make up about 51% of the total US population.)
“Our goal is for the number of CFP professionals to represent the demographics of the United States,” said Elliott, who in 2022 became the first African American to chair the CFP board. “I would like a day when we see 13% of CFP professionals being black and 19% Hispanic.”
Diversity among financial planners is not only important for the industry, but also for the entire American population – it can encourage more minority households to seek financial advice if that advice is more readily available from someone. ‘one that looks like them,’ Elliott said.
The CFP Board has attempted to raise awareness and make available the financial planning profession, through scholarships for preparation courses for people taking the CFP exam, as well as encouraging mentoring and internship programs among advisers, and to organize an annual diversity summit, for example, the civil servants mentioned.