Widespread protests against racism sharpen focus of FPA’s virtual internship
Growing up in a tiny town outside Houston, Kameron Kindle watched his parents working for themselves, his mother as a beautician and his father as a contract truck driver, without any professional financial guidance.
“Nobody in the family had an advisor or had anyone to teach them how to manage money well,” he says.
But now Kindle, 24, is one of 1,950 students enrolled in the FPA’s virtual internship program, launched almost overnight to replace internships canceled nationwide due to the coronavirus pandemic. As a result, he thinks he’s one step closer to being able to help people in his parents’ position by breaking into a field that has long lacked diversity — particularly among Black men like himself.
“Especially in this time when we are thinking, ‘Is there going to be a shortage of opportunity,’ in comes this one,” says Kindle, who graduated last month as a finance and business administration major from Prairie View A&M in the Texas city of the same name. “It’s put a lot of fire in me to learn as much as I can.”
While prompted by the pandemic, the program has taken on greater resonance in the midst of unprecedented outrage over systemic racism against Black Americans sparked by the murder of George Floyd at the hands of the Minneapolis police last month.
Hannah Moore, a 33-year-old RIA owner in Richardson, Texas, who heads up next-gen activities for the FPA, and who conceived of the program, assembled a diverse team to teach and network with students. She partnered with Charles Adi, an RIA owner in Houston, who runs the FPA's diversity committee. With their collaborators, they conducted outreach to nonwhite planning students, contacted historically black colleges and universities and built a diverse slate of faculty.
Anybody involved in attracting new planners to the field is aware of the stunning dearth of nonwhite and female entrants to the profession, Moore says.
“The old ways aren’t good enough anymore,” says Moore. “People are demanding change in all areas. This is the generation that is going to bring financial planning to the masses.”
There is clearly a way to go before the industry achieves anything resembling racial parity among its practitioners. Of about 87,000 CFPs nationwide, only 1,355 are African American, the CFP Board disclosed to Financial Planning this month. There are 1,904 Hispanics CFPs. Together, the two groups account for just 3.8% of CFPs, while comprising 30% of the U.S. population, according to the board. And, of the 551,000 “personal financial advisors” reported by the Bureau of Labor Statistics (a broad tally including sectors beyond wealth management), just 6,900 are Black.
But it’s not unique to wealth management. Looking at financial services more broadly, the assets managed by minorities are lopsided. Of $69.1 trillion in global assets in mutual funds, hedge funds, real estate and private equity, fewer than 1.3% are managed by people of color and women, according to a study by Stanford academics last year.
The recent protests and rallies against racism are about far more than the death of Floyd and other Black Americans, according to Adi. “Everything that we are protesting about is speaking to a whole core of issues,” he says. ”It’s not just about police brutality. It’s about healthcare and financial empowerment.”
The virtual internship program’s success will be determined if a majority of the nearly 2,000 students are able to build careers in the industry, Adi says.
“We started with 40 people just marching, and it turned into 15,000," an advisor says.
An advisor whose family has been “irrevocably harmed by police brutality” calls on industry peers and their clients to spark positive change.
The firm said in a post on Twitter that it "has zero tolerance for racism and discrimination of any kind."
To illustrate the challenges facing aspiring Black advisors, young white advisors often have an advantage when they can build books of clients using their monied family networks — connections that can also help get them their first jobs in the industry.
“RIAs don’t come to see you to recruit [as they do on campus],” Kindle says. “They just recruit through their personal networks.”
If successful, the program will offer another path into the industry, its creators say. For a $39 student FPA membership, students get classes and networking opportunities with dozens of top planners nationwide via pre-recorded sessions, live virtual office hours, Q&As and online happy hours.
Of the 34 speakers, evenly divided between men and women, 20 are white, eight Black, three Hispanic, two Asian. One person self-identified as LGBTQ.
The student body, with a 62%-38% male-female split, more closely reflects the current racial makeup of the industry with 60% white, 15% Asian, 10% Hispanic, 8.5% identifying as Black or African American, 1.25% Middle Eastern or North African, 0.31% Native Hawaiian or Pacific Islander, 0.31% Native American or Alaskan Native, 1.25% some other race or origin, with 3.63% declining to say, according to the FPA.
In the program’s first week (it began June 1 and ends July 24), students of all races flooded speakers with hundreds of questions about how to break into the field, says Keith Beverly, one of the lecturers and a managing partner at Grid 202 Partners, an RIA with offices in Washington D.C. and Durham, North Carolina.
“There’s probably an equal number of students of color who have reached out to me as of white students” via Linkedin, following his talk, Beverly says. “To get about half and half ... speaks to the fact that having some representation is important.”
Some advisors who were not involved in the program’s design or launch jumped in on hearing of it.
Thomas Ouellette, founder of Ouellette Wealth Management in Lexington, Massachusetts and an advisor in the Carson Group Coaching program, is participating in the program himself as a student along with his four summer interns, one of whom is his son.
“It’s incredible,” he says.
Ouellette found out about it a week before it started and recommended it to the 100 advisors in a Carson Group Coaching program. The group selected the internship as a “best idea.” Ouellette suspects many advisors like himself grabbed hold of it to enhance their own in-house programs.
“I could not offer anything of this quality on my own,” says Ouellette. He is supplementing his interns’ work with his own one-on-one mentoring.
The program provides students 160 hours of credit towards their CFPs. They can earn free certification on eMoney software, which is used by 70,000 advisors nationwide, and gain expertise on Morningstar software.
TD Ameritrade, eMoney and Morningstar are sponsoring the program.
In the future as the program expands, Ouellette says, he expects firms of all sizes will look to hire people who complete it.
This is the kind of change that’s needed, according to Chris Woods, host of the FPA’s new African American Knowledge Circle and one of the program’s lecturers. He echoes the optimism of others when he says “This will open doors.”
In Kindle’s words: “My goal mainly in this industry is to help African Americans and anyone trying to better their lives. There’s hope out there.”
Additional reporting by Tobias Salinger