Vol. 16- Addressing Racial Inequities in Financial Planning
In this episode, we are addressing what to do with pay increases due to overtime, raises, and bonuses. We cover:
The hurt we are feeling personally and as a nation due to multiple senseless loss of black lives in the last few weeks
The devastatingly low numbers of black and latinx certified financial planners
Adjusting assumptions that address the unique risks of people of color
Asking your non-POC advisor to look into resources to better serve you is not synonymous to calling them racist
Resources to be better informed and serve POC
Resources mentioned:
Why Minority Financial Planners Are Nearly Nonexistent -- And How To Fix It
Layla Saad’s Best-Selling Book Challenges Readers To Dismantle White Supremacy
White Fragility: Why It's So Hard for White People to Talk About Racism
24 books for white people to read beyond Black History Month
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TRANSCRIPT:
Naseema McElroy (00:01): All right, Nurses on Fire. So we are back with Leisa Peterson once again, and this episode is kinda going to be a lot more raw and real than past episodes have been, because we're kind of both in our feelings right now about the things that are going on just around us. And to say that this has been a really hard time is to put things lightly because I mean, not only are we dealing with these issues of coronavirus and quarantine and all those other things, and we're just now dealing with these heavily heated conversations, riots, lock downs, and now curfews, because this country is in an outrage over, you know, again, quite a few black deaths, not just why we shot. It was just like one, but quite a few black deaths that have almost basically been unanswered. And, you know, it's hard. It's hard for me. I haven't really talked about it much, but it's hard for a lot of people out there. And Leisa, I know this is a very hard time for you too, so I don't discount anybody. Who's not a person of color that is feeling this because above all else, we're human and you know, this is, it's just hard.
Leisa Peterson (01:29): Yeah. Well, we were talking offline that, yeah, just because my skin is a certain color doesn't mean that I want change just as bad as anyone and we can all have different lives and different experiences. You know, I think I've shared, I'm not sure with your audience, but like I came from, you know, lower middle class home and the struggles are real. And that is what motivates me. And that's what, you know, I'm always voting for the underdog. Like I will literally change parties because of looking at the underdog. It's kind of a funny thing that I watch myself. Like I want to help those who are needing a hand up. And if I can use my platform, my voice, my body, my actions to help someone else I'm going to do whatever I possibly can to do that period. And I'm learning here, you know, this is, it's a wake up call because like, I think all of us wanted to do more in the past and haven't necessarily been able to. And I think the more we go into it, like even offline, we were looking and talking about certified financial planners. And I was just shocked to learn that only 3.5% of the 80,000 certified financial planners in the United States are black or Latino. And that just shocked me as like, that is obviously a serious problem. Then you don't have the ability to find advisors who look like you and understand you and your family and the culture and things that I think are really important.
Naseema McElroy (03:11): Yeah. I think it's super important too. And we can kind of say, Oh, well, our certified financial planner is vested to do what's in the best interest of everyone. Yeah. And no, because if you don't know, if you're not made aware of certain issues or if that's not been part of your reality or you have no context around it, how can you really truly and effectively create a financial plan that is going to actually benefit someone just like in the CFP episode, where we were talking about how to find a good financial advisor or what to look for in a financial advisor, we talked about like the fire movement, for example, if you don't understand like how somebody has set up their lives in order to retire early, you're not going to be able to effectively create a financial plan for them. It's just like, if you don't understand that, like me in 2008, you know, I was because I was a young black woman targeted for the subprime loans, you know, and now I have a bankruptcy and all this kind of stuff in my background and without good financial literacy, I'm prone to fall for that again, because again, what I want to do is build a legacy for my family and I'm well intentioned, but there are predatory people out there that know that I'm well intention and will try to sell me a $1,000 a month life insurance policy that I don't need just because they know that I don't have the financial literacy or where with all in order to say that this is not something that I need.
Naseema McElroy (04:57): And that's the whole reason why this platform exists is to give you that information. So you don't make those mistakes, but we also need people that are in the financial professional space to be our allies and to understand our issues. And so it's not a race thing. It's about making sure that the person that you're trusting with your money and your finances really understands your background and understands your issues.
Leisa Peterson (05:24): And understands the risks is what I also heard. You mentioned earlier about lifespan or challenges with health, or, you know, all these different things like those affect the statistics. Cause what happens when you go to a financial advisors, they all have different data collectors that, you know, put it into a black box and there's all these assumptions that they're making like a hundred assumptions. And if the assumptions aren't adjusted for, you know, lots of different factors, if they don't care enough, then what comes out on the other side is completely not accurate for what you think it is. So you see those numbers and you're like, Oh, I'm on track. As long as I save this amount of money, you're going to be fine. But I think what you're bringing to light and wanting people to know is a don't trust. Those B makes sure that they're asking questions or that they really do understand what the different risks are for, you know, who you are, what you look like, how your history of like health issues.
Leisa Peterson (06:29): You know, if you had parents who all died, you know, at a certain age or have a disease, like let's make sure that we prepare for that. You just don't know all the things, but those are the questions that you're wanting them to ask you. When you engage with someone to write a financial plan for you, that they're making sure and understanding the health risks as well as job risks. Cause you were saying that you might have a higher chance of losing a job and you know, these things matters. So you might find that your amount of money to be on target just to be safe. Again, may not happen, may be irrelevant, but it may be a much higher amount of money that you're going to be saving and putting aside then a white woman.
Naseema McElroy (07:15): Right.
Leisa Peterson (07:16): It sounds like that's a very viable possibility. So how do you make sure that someone's paying attention to that and taking it seriously?
Naseema McElroy (07:25): Definitely. Definitely. And then I think like, even if you're not a person of color, but if you're a woman and you're married, like does your financial advisor understand that sometimes people are in like maybe abusive marriage is that they need to have like a different financial plan on the side where, you know, they have an escape route, just little things like that is just during these times brings my awareness to the fact that people just need to be sensitive to other people's needs. And as professionals, if we're not taking time to learn and grow, even if this is not something that we're familiar with, I think we're doing a disservice to the people that we're serving. And so for people who, you know, just don't know what to do, or as a CFP who wants to learn more and wants to do better, what are some resources that you've found that can be helpful? I'm talking about, like from a CFP perspective, if you want to do better in understanding a lot of the societal issues that people of color have had to face so that you can prepare effective financial plans for, you know, your people of color, your population, who are people of color, what are some resources?
Leisa Peterson (08:45): So as folks may know, I have a community that I serve in this past week. I was, you know, doing a lot more research for myself about what can I do to become more informed. And it may even be that we, some of these resources that we'll talk about could be shared with your advisor. Like sometimes we might even have to be that obvious, like, Hey, I want you to know how I want you to communicate with me. This is like setting good boundaries with people that we like them overall, but we know they could be more sensitive perhaps, so we can send this stuff to them. And maybe we can post these things on the show notes for this conversation. But what I was looking into first and foremost was this whole topic of anti-racism like, what is that about? And so there are some books and there are some resources that, that I have tuned into that I'm just blowing in my mind at how insightful and helpful.
Leisa Peterson (09:46): And I will say the one thing that I feel like applies to this conversation that really has stuck out at me is there is a concern about, let's just say folks who are not of color, like what have you, I don't know all the ways that they, they define this, but a defensiveness like this defensiveness that if you bring it up that immediately, this sort of defensive posture comes like I'm not racist, kind of, you know, or whatever defensiveness is. You know what I mean? I mean, and if we can be okay with the fact that that that is happening, but yet it doesn't have to, like, all it is to me right now is a sign that someone needs more coaching. They need more understanding. They need to understand that this is not the response. That's going to get them where they want to go.
Leisa Peterson (10:41): It's not about denial anymore. And so that's what I'm getting through. These resources is about let's look at even that first. So if you were to tell your advisor who may not look like you, that you'd like them to be more sympathetic and you get a defensive response, just know that's pretty common, but it doesn't have to stop there. [inaudible] you can lean into it and say, I understand there's a desire, whatever a response of being defensive, I'm not going to hold that against you. I'm going to give you a chance to just say, look into these resources. There's things here for you to learn. And I really do wish that somebody had been more like that for me in the past, because then it doesn't have to be about me going into a shame storm or a blame storm. All of a sudden I can be like, Oh, you're giving me an opportunity to become educated. Does that make sense? Definitely, definitely. But I think, you know, some advisors are more open than others. Like I share with you, I shared some resources with a financial advisor and totally got pushed back from it. But to me, I don't get upset about it because then it shows me that that's not somebody
Naseema McElroy (11:54): that I would want to work with. That's not somebody that, you know, could probably help me in the capacity that I needed to help that I need help. It's not saying that they're a bad financial advisor at all. They're probably excellent at what they do, but a financial advisor is that's a very personal relationship. Um, and it's very unique and individual to what you need. And so you need to make sure that that relationship is serving you.
Leisa Peterson (12:22): I think what I'm learning through all of this is that we don't have to say I'm okay. Not racist like that, that we're actually in denial by saying that like, cause there's, it's impossible, it's in the air we breathe. And so instead of having that conversation, it's like lean into learning more about the ways to show up without denial. Like, that's it, that's it. Then the door is open and all of a sudden conversation can start to happen and we can learn how to start making a difference in the world. And I think that's what all of us want. You know, I think most of us, like if we're, if we've chosen somebody, they want the best for us. Like we can feel that, but this other part is new for a lot of people. And I have shed a lot of tears even over the past 48 hours because the light bulb is coming on.
Leisa Peterson (13:21): It's like peeling back the onion skin. There's always another layer of self discovery here for how we can become better people. So I'm really into this guy, Lama rod Owens, he's written a big book with a couple other folks called radical Dharma. And so if you're someone who likes it's Eastern philosophy, they're exploring it. And he's got a new book coming out in a couple of weeks, which I'm also going to get, which is called love and rage. And it's like diving into he's queer, you know, and black. And he's also a Lama. And he's looking at, it's like going into his mind, the challenges, cause this is all about empathy, right? And about putting yourself in someone else's shoes, you know, to begin with. There's also 24 books for white people to read, got to love that the other big one is what I think we were talking about earlier.
Leisa Peterson (14:17): And I don't have this book yet, but I'm on hold at. The library is right for agility. Yep. So that deals with the defensive posture, right? That's and black lives matter. Reading lists like there are so many books. I mean, I don't think there's enough time to read all of them, but I think what we're going to be trying to do are find the books that rise to the top that really speak to us and can help us to become more informed about things that we may not have. Very good we're sanding and I'm kind of blown away at how much you can learn in a very short amount of time, actually put your heart into it.
Naseema McElroy (14:51): And I have another book to recommend it. It's called the black tax, the cost of being black in America, especially as it pertains to these issues. I don't think that you just have to read exclusively about black people obviously, but I think this book has a good historical context that goes back to the economic inequities, especially for black people, just from the time of slavery. And so it was just puts things into perspective, but is really heavily researched. I, it goes to just current times and how like, even in the highest level, highest level jobs like being hired at a law firm, there is a lot of inequity. And so I really liked that book and kind of like understanding those issues to me, I feel like will make you a better ally for your clients. And so that's, that's what I recommend. Yeah.
Leisa Peterson (15:40): That's a great, and I'm totally checking that one out too. Thank you.
Naseema McElroy (15:46): Yeah. And there's a Google talk. If you don't want to read the book, there's a really good talk that he did at Google, but I'll post all of this stuff in the show notes. And I look forward to having more of these conversations with my audience about what they feel like they would need just in this time of trying to unwrap these issues, but also, you know, still focusing on all the things that go into being financially responsible. And I think a lot of us are trying to better ourselves financially because we want to be in a better position to help our family and to support social causes. And you know, we can't do that if we're broke. So yeah, I love that. Leisa, you're open to having this conversation with me and you're not shy to have it and that I really truly feel like you care. And I'm really grateful for you just in general, because you're just awesome person and we need you and girl, we need you.
Leisa Peterson (16:47): I appreciate this conversation too. And I told you offline. I mean, I think the thing that I'm working through right now is no matter how much you care when you're learning something and you're trying to get deeper into it, there is that fear of making mistakes and saying the wrong thing. And I'm giving myself a lot of compassion because if I get wrapped up in that, then I won't show up and that doesn't serve anybody. But if I can learn and be willing to fall down and make mistakes and hold myself accountable to those mistakes. Cause every time, right, just to be clear, those mistakes are things that like open portals of like learning that as long as I have this space to be that, then it's just awesome. So thank you.
Naseema McElroy (17:34): I really appreciate you showing up. Thank you.
Hey there I’m Naseema
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