Wealth and income disparities between Black families and white in the U.S. are well documented and indicate a troubling consequence of racial injustice and financial discrimination. These statistics, however, can also give a misleading impression that Black families cannot afford or do not need professional financial services.
The median wealth among Black families in the U.S. rose by 33% from 2016 to 2019, according to the Federal Reserve, and Black families in 2020 held $4.6 trillion of total household wealth.
Although it remains imperative for us to explore policies and practices to close the wealth and income gaps and address social injustice, many Black Americans can benefit from the services of insurance and financial advisors.
This is particularly true of Black women. According to the Center for American Progress, more than 64% of Black mothers are the primary breadwinners or co-breadwinners for their families. Government statistics show that women make up 64% of Black Americans earning college undergraduate degrees, 72% of those earning master’s degrees, and 66% of those earning doctorates or medical degrees.
Black Women Make Good Clients
Mary Greene is a financial professional with Prudential Advisors, and a significant portion of her clients are African American women who are highly educated, earn good incomes and have assets they want to grow. “If you’re not tapping into the African American female population as clients, you’re missing out on a whole different market that’s very lucrative,” she said.
Greene was part of a panel discussion presented by NAIFA on the importance of Black women advisors. Her co-panelists were Kristen Eskew, a business development executive with OneDigital; Martina Jimenez Sperry, managing partner at Centurio Wealth and Karen Holloway, a wealth management advisor with Northwestern Mutual.
Many Black Americans have good incomes and significant assets, the panelists agreed. What they lack is access to financial products, services and advice. Often, when asked why they haven’t done more financial planning, their answer is that no one has asked them to, Eskew said.
“Black women make great clients, if you can get in front of them,” Holloway added.
To better serve these markets and provide financial security opportunities for everyone, Jimenez Sperry said financial services firms need to “make it a priority to have a diverse team to represent the community.”
The Strengths Of Black Women As Advisors
Black women are hardworking and know the importance of taking care of families, two traits that make them great advisors, according to Greene. “We belong to a lot of civic, religious and social organizations,” she said. “So we can introduce [the industry] to those organizations that we volunteer in and that we have personal connections with.
“If you want to get into the Black community, you’ve got to start connecting with these African American females,” she said.
There is a lingering distrust of the life insurance and financial services industry among some Black Americans because of historical discrimination. Often, people can overcome this distrust by working with an agent or advisor who shares common experiences.
“This is not monolithic,” Eskew said. “Not all Black people feel like they can work only with a Black advisor and the same can be said about other cultures. But I do think there is something here.”
How To Bring More Black Women Into The Business
A key to reaching Black markets, and particularly to attracting Black women as clients, is recruiting Black women into the industry and enabling their success. As a recruiter, Greene looks to attract advisors who are coachable, have existing networks of potential clients, and are comfortable working as part of a team.
In her experience, there is a large and talented pool of Black women who share these attributes.
Creating and nurturing a diverse team must be part of a comprehensive strategic plan. Firms cannot hire a Black woman simply to be able to check a box, Jimenez Sperry said. They need to provide support and help their advisors brand and market themselves. They need to create inclusive business cultures.
Why Does The Industry Need More Black Women Advisors?
“The easiest answer is because people want them,” Holloway said. “There’s a demand for it. We’re seeing more and more Black women are making money and wanting advice, and they’re looking for someone to give them advice. So it’s supply and demand. If they’re demanding that, then the market should respond.”