What is Failing Us? An Examination of Diversity Initiatives in Financial Planning

Posted: 8 Apr 2021

See all articles by Aman Sunder

Aman Sunder

College for Financial Planning

Jim Pasztor

College for Financial Planning

Rebecca Henderson

College for Financial Planning

Date Written: April 8, 2021

Abstract

This paper examines the lack of diversity in the financial planning profession by expanding the variable focus to include both the household side (i.e., consumer demand for financial advice) and the aspiring and existing financial planner professional side (i.e., the supply of financial advice). This study uses data from 13,507 households from the 2004 to 2016 waves of Survey of Consumer Finances (SCF) and data from 37,665 students enrolled at the College for Financial Planning for 2005 to 2018. We found that any amount of racial bias against non‐White financial planners could substantially reduce their market. Previous studies have focused almost exclusively on macro‐demographic comparisons. Therefore, reliable information on the extent of racial bias and satisfaction among racially discordant financial planner‐client relationships is not available. Black and Latinx households lag White and other households to attain high school diplomas and undergraduate degrees, partially explaining the lack of a diverse pipeline into the profession. We argue that there continues to be a need to eliminate survivorship bias when attempting to understand the realities faced by non‐White financial planning professionals by surveying those who were not successful in becoming financial planners.

Full Text Available Here:
https://doi.org/10.1002/cfp2.1108

Suggested Citation

Sunder, Aman and Pasztor, Jim and Henderson, Rebecca, What is Failing Us? An Examination of Diversity Initiatives in Financial Planning (April 8, 2021). Financial Planning Review, Vol. 4, No. 1, March 2021, Available at SSRN: https://ssrn.com/abstract=3822725

Aman Sunder (Contact Author)

College for Financial Planning ( email )

9000 E. Nichols Ave
STE 200
Centennial, CO 80112
United States
7853176604 (Phone)

Jim Pasztor

College for Financial Planning ( email )

9000 E. Nichols Ave
Suite 200
Centennial, CO 80112
United States

Rebecca Henderson

College for Financial Planning ( email )

9000 E Nichols Avenue
Suite 200
Centennial, CO 80112
United States

HOME PAGE: http://cffpinfo.com

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