Closing the income gap for minorities in the financial planning industry is a top priority for Mark Delp at Impact Wealth Management.
The Irvine financial advising firm, formerly known as Your Wealth Effect, puts minority empowerment into practice by paying their employees’ full tuition for certification courses necessary to climb the financial advising ladder.
Much of Impact’s more than $42,000 in local donations have helped its employees earn industry certifications, such as a Certified Financial Planner (CFP) license, that increase their income.
Raises and bonuses “don’t help your career” as much as education, Delp, Impact’s branch manager, told the Business Journal.
That’s because investing in an employee’s coursework generates more long-term return for them than the immediate pay boost, Delp said.
Impact, which is part of the Wells Fargo Advisors Financial Network LLC, took the title of OC’s fastest-growing small private company two years ago for growing revenue nearly 800% to $9.1 million in two years.
Impact counts nine employees at its Irvine office. It expects to generate $12 million in revenue this year and reach $15 million next year.
CFP Disparities
Barriers to diversity in financial planning—such as economic inequality, client bias and lack of awareness for the profession—have hindered upward mobility for minorities in the industry, according to race and gender diversity reports by the CFP Board of Standards Inc., which sets and enforces requirements for the CFP certification.
The nonprofit states on its site that less than 24% of CFP professionals are women or non-binary, while less than 10% are Black, Latinx, Native American or Asian.
“As a Hispanic person, I felt it was time to change that,” Delp said.
For Delp, that change starts with investing in Impact employees who prepare for the CFP exam.
Tuition Upfront
Financial advising professionals must meet several requirements before becoming a CFP. To be eligible for the CFP exam, one must have more than three years of full-time financial planning experience and complete a CFP Board-registered program or hold a CPA license, CFA license or Ph.D. in business or economics, among other qualifications.
Other certifications that expand a financial advising professional’s skill set can also increase their income. Completion of the Series 7 exam, for instance, grants financial advisors authority to buy and sell stocks, while the Series 24 exam allows them to become managers.
Prep programs for such exams, which typically take about six months to complete, cost around $2,000 per course, according to Delp.
Impact initially reimbursed its employees their full tuition after they graduated from their financial planning courses. The firm has changed its policy to cover employees’ tuition in advance due to the prior program’s low participation.
“We learned employees didn’t have the financial resources to pay for tuition upfront and then wait the months or years to be reimbursed upon graduation,” Delp said.
Shortly after Impact changed its tuition policy, about half of its team signed up for the program.
Salaried Studying
Four of Impact’s employees have used the education program to earn certifications.
“Now, their income is substantially higher than it was before,” Delp said.
The biggest expense for Impact’s education program, however, isn’t the tuition—it’s paying employees their full salary for time spent studying.
The policy intends to further encourage employees to advance their education, which many tend to put off due to work or family obligations.
Employees at Impact “are actually continuing their classes because they can spend time to focus on studying,” Delp said.
Volunteering
Full-time salary isn’t only offered to employees who are studying for certification exams. Impact employees also receive full pay for time spent volunteering in the community.
Members of Delp’s team spend their off-hours serving several causes, from volunteering at animal shelters to coaching youth sports.
Delp’s personal charitable passion is autism awareness—particularly in helping young adults with autism get employed.
Unemployment for neurodivergent adults runs as high as 30% to 40%, according to the Center for Neurodiversity & Employment Innovation.
“Many employers don’t want to hire special kids because they believe they’re not worth their time, effort or hassle,” said Delp, who has a 23-year-old son with autism. “But it does a lot of good in society to have young special needs adults actually have meaning.”
