GITNUX MARKETDATA REPORT 2024

Diversity In The Wealth Management Industry Statistics

The wealth management industry lacks diversity with a disproportionate representation of wealthy White men compared to other demographic groups.

With sources from: institutional.vanguard.com, kitces.com, onefpa.org, entreda.com and many more

Statistic 1

60% of all wealth management clients would prefer to work with a more diverse team of advisors.

Statistic 2

44% of millennials want to entrust their wealth to companies embracing diversity.

Statistic 3

Over 80% of wealth management firms report having a lack of gender diversity.

Statistic 4

98% of American financial advisors are white.

Statistic 5

While people of color make up approximately 39% of the U.S. population, they account for only about 20% of Certified Financial Planner certificate holders.

Statistic 6

About 20% of senior leaders in wealth management are women.

Statistic 7

A McKinsey study found that firms with more diverse leadership teams outperform their peers by 25%.

Statistic 8

Only 31.6% of wealth advisors in the United States were women by 2020.

Statistic 9

Asian persons accounted for only 5.6% of the total number of financial advisors in the U.S by 2020.

Statistic 10

Only about 7% of the total financial advisor workforce in the United States is under the age of 30.

Statistic 11

More than half (56%) of firms in the wealth management industry have no explicit diversity and inclusion targets.

Statistic 12

In 2020, only about 15% of financial advisory firm owners and principals are female.

Statistic 13

A study by Cerulli Associates found that older advisors are three times more likely than their younger counterparts not to perceive a lack of racial diversity as an issue in the wealth management industry.

Statistic 14

According to the Financial Planning Association (FPA), people of color currently enter the financial planning profession at a lower rate compared to their White counterparts.

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In this post, we explore the stark realities of diversity within the wealth management industry through a series of eye-opening statistics. From the preferences of clients to the demographic makeup of financial advisors, these numbers shed light on the current landscape and the importance of fostering inclusivity and representation in this sector.

Statistic 1

"60% of all wealth management clients would prefer to work with a more diverse team of advisors."

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Statistic 2

"44% of millennials want to entrust their wealth to companies embracing diversity."

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Statistic 3

"Over 80% of wealth management firms report having a lack of gender diversity."

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Statistic 4

"98% of American financial advisors are white."

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Statistic 5

"While people of color make up approximately 39% of the U.S. population, they account for only about 20% of Certified Financial Planner certificate holders."

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Statistic 6

"About 20% of senior leaders in wealth management are women."

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Statistic 7

"A McKinsey study found that firms with more diverse leadership teams outperform their peers by 25%."

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Statistic 8

"Only 31.6% of wealth advisors in the United States were women by 2020."

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Statistic 9

"Asian persons accounted for only 5.6% of the total number of financial advisors in the U.S by 2020."

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Statistic 10

"Only about 7% of the total financial advisor workforce in the United States is under the age of 30."

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Statistic 11

"More than half (56%) of firms in the wealth management industry have no explicit diversity and inclusion targets."

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Statistic 12

"In 2020, only about 15% of financial advisory firm owners and principals are female."

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Statistic 13

"A study by Cerulli Associates found that older advisors are three times more likely than their younger counterparts not to perceive a lack of racial diversity as an issue in the wealth management industry."

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Statistic 14

"According to the Financial Planning Association (FPA), people of color currently enter the financial planning profession at a lower rate compared to their White counterparts."

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Interpretation

The statistics presented clearly highlight the significant lack of diversity within the wealth management industry, particularly in terms of gender and racial representation. Clients are increasingly expressing a preference for working with diverse advisory teams, yet the industry continues to be overwhelmingly dominated by white males. The underrepresentation of women and people of color not only reflects a disparity in opportunities but also a missed potential for enhanced performance, as evidenced by studies showing the financial benefits of diverse leadership. Addressing these diversity and inclusion gaps within wealth management firms is crucial not only for meeting client preferences but also for fostering a more equitable and successful industry overall.

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