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Financial Planning > Behavioral Finance

LIMRA: Many African-Americans Want Money Advice

By Allison Bell

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Financial planners could have an edge in getting the business of African American consumers.[@@]

A researcher at LIMRA International, Windsor, Conn., has published data supporting that conclusion in a new report based on a survey of African-American consumers ages 25 to 64 with annual household income of at least $25,000.

The researcher, Nilufer Ahmed, found that 73% of the survey participants said they had no one to contact for financial advice or relied only on friends and relatives. More than half, 53%, said they had no source of financial advice.

When Ahmed asked the participants with no source of financial advice about the type of professional advisor with which they would feel most comfortable, 37% named financial planners, 20% named bankers and 14% named lawyers. Only 3% named insurance agents or brokers.

Ahmed also addressed the question of advisor race.

Although 93% of the participants said it was important for their advisors to understand their families’ financial needs and 84% said it was important for advisors to represent well-known companies, only 41% said it was important for advisors to be African-American or to be associated with their places of worship.

But 65% of the participants did want to do business with advisors who are active in their communities.

“It is probably easier to find African-Americans who fulfill many of the characteristics that African-Americans find desirable,” Ahmed writes in the report.

In other findings, Ahmed found that African-Americans are more likely than other U.S. consumers to be concerned about the adequacy of their savings and about the financial well-being of aging parents and relatives.

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