As long-time investors, we all understand the importance of diversification when it comes to growing wealth. Bear markets and corrections are inevitable, which is why putting everything into a single asset class is not wise. But what about applying that same principle to our identities? What if “Identity Diversification” could help grow not just our lifestyle, but also our opportunities and wealth?
It’s not something I had ever really thought about, nor have I seen much written about it. But becoming a father, and seeing my children’s birth certificates, forced me to consider their identities and what they might mean for their futures.
Merit will always be the most important factor in getting ahead. While working on Wall Street, we mostly ate what we killed. And with Financial Samurai, there was always a strong correlation with effort and growth until AI came along.
In recent years, it’s become clear that identity matters too. If you’re fortunate enough to come from a multicultural background—as most people do today—leaning into identity diversification can be a powerful advantage for both survival and success.
Neglecting My Hawaiian Ancestry For Too Long
It wasn’t until I became a father—and especially after living through the pandemic—that I realized just how much I had neglected my Hawaiian roots. My mother is from Taiwan, and because I lived there for four years, minored in Mandarin, studied abroad in China, and later worked in Asian equities, my personal identity has long been rooted in my Taiwanese heritage.
My love for language and culture even led us to enroll our children in a Mandarin immersion school. There’s something magical about dreaming in another language. Once you become fluent enough, it’s like living in two different worlds, which feels like a small life-extension hack as you grow older.
Ironically, the only two skills from college I still actively use are Mandarin and negotiation. Everything else, such as all the elements in the periodical table, has largely faded into the background.
Why I’m Refocusing on Hawaiian Ancestry
The birth of our son in 2017 made me think more deeply about our family’s mix of cultures. Although we simply see him as our son, he carries a diverse heritage—my wife is German, Irish, and Japanese.
On my father’s side, my great-grandmother was 100% Native Hawaiian. That makes my grandmother half, my father 25%, me 12.5%, and my children 6.25%. I’ve been traveling to Hawaii since I was born in 1977 and have absorbed some of the culture, but never immersed myself in it the way I did with Chinese culture.
Part of the reason is that no one encouraged me to attend Hawaiian school. Another is that my parents were in the foreign service, so we moved every two to four years and never spent more than a few months at a time in Hawaii each year. We were immersed in Zambian, Japanese, Taiwanese, and Filipino culture for 13 years.
By the time I came to America for high school in 1991, I didn’t feel that 12.5% gave me the right to identify as Hawaiian. I held a subjective belief that you needed at least 50% to claim a particular race.
Then, in 2018, something opened my eyes.
Elizabeth Warren and the Question of Ancestry
In October 2018, after years of criticism for identifying as Native American in her law career, Senator Elizabeth Warren released a DNA test conducted by Stanford geneticist Carlos Bustamante. The analysis showed evidence of a Native American ancestor six to ten generations back—roughly 1/64 to 1/1024 Native American, or about 0.1% to 1.6%.
Warren said the results confirmed her family stories but acknowledged that DNA alone doesn’t confer tribal citizenship, later apologizing to Cherokee Nation leaders. Her supporters saw the test as validation of her being listed as a “minority law teacher” in law school directories from the late 1980s through the mid-1990s, and of her identifying as “American Indian” on a 1986 Texas State Bar registration card.
As a minority myself who struggled to get promoted to MD at work, I was frustrated. Never in a million years would I claim to be Native American if a DNA test showed just 0.1% to 1.6% ancestry. That’s the kind of fun fact you might casually drop at a party, not something you’d put on official forms. On every form I’ve ever filled out, I’ve simply checked “Asian.”
Most Of The Country Is OK With It
Yet, at least half the country seemed fine with Senator Warren’s claim. After all, she’s still a Senator today. It wasn’t considered a problem that a white woman could identify as one of the rarest minorities in America and potentially benefit from it. Suddenly, my long-held personal belief that you needed at least 50% ancestry to legitimately claim a race was challenged. Apparently, even 0.1% could be enough.
To me, the only opinions that truly matter are those of Native Americans themselves. Still, as a rational observer, and as a father who wants to ensure my children are treated fairly, I couldn’t ignore what this meant. The widespread acceptance of Warren’s actions made me start rethinking my own children’s identities, and it planted the seed of what I now call Identity Diversification.
DEI on Full Throttle, But Not for Asians
After George Floyd’s death in 2020, diversity, equity, and inclusion (DEI) initiatives gained tremendous momentum in schools and workplaces. I support DEI to a point, because diverse perspectives can spark better conversations and solutions. Just look at the comments section on Financial Samurai, hooray! The more we can understand different perspectives, the better.
I’m especially passionate about advocating for people with disabilities, who make up about 15% of the world’s population and deserve greater accommodations. Let’s all do more to help the most important minority that spans all races.
But from 2020 to 2023, the DEI movement often felt exclusionary toward Asian Americans, despite Asians making up less than 7% of the U.S. population. Not only were we frequently left out, but sometimes vilified and even attacked during the pandemic.
This climate motivated me to become more public when my book Buy This, Not That came out in July 2022. I wanted to show support for the Asian American community during a difficult time and spread some positivity. After all, since starting my site in 2009, over 100 million people have visited, and countless readers have improved their finances partially as a result.
Then, on June 29, 2023, the Supreme Court struck down race-based affirmative action in college admissions, including at Harvard and UNC. Court filings revealed that Asian American applicants, on average, needed significantly higher test scores than students of other races to gain admission.
To offset this disparity, Harvard relied heavily on a subjective “personality rating,” which was often used to justify rejecting many qualified Asian applicants. Such BS. This was the moment where it seemed like the DEI tide began receding.
Teaching My Kids About Their Hawaiian Roots
Between Warren’s example—showing that even a fraction of ancestry can “count,” with half the U.S. population agreeing—and the mixed results of the DEI movement, I realized it was time to teach my children about their Hawaiian heritage.
It’s a too late for me. At 48, long finished with school and having left the traditional workforce in 2012, my path is already set. But it’s not too late for them. They’re part Hawaiian by blood, and I believe it’s essential they learn the language, understand the history, and embrace the culture. At just 5 and 8 years old, they still have plenty of time.
So we enrolled them in a five-week summer program in Honolulu with Hawaiian class as part of the curriculum. The experience was enriching, and our plan is to return every summer and winter until they graduate high school. My hope is that they not only immerse themselves in Hawaiian culture, but also find meaningful ways to give back to the community.
For example, Jack Johnson, the singer who was born and raised on Oahu, has done an incredible job promoting environmental education and conservation on the islands. Although he isn’t Hawaiian by blood, he’s Hawaiian through and through in how he gives back to the community. Elizabeth Warren, on the other hand, doesn’t seem to have done anything for the Cherokees except assume their race.
Identity Diversification Helps You Blend In With The Times
Identity diversification may be even more important than investment diversification because it directly affects opportunity. If you can’t get into a good school or land a good job due to your identity, you won’t even have the chance to aggressively save and invest for the future. It’s unfair to be judged or discriminated against for who you are, but that’s a reality in today’s culture. The best we can do is recognize this truth and find ways to adapt.
Let’s look at some examples of how identity diversification can help you survive and thrive.
1) New President Of The United States
Let’s say you’re half Asian, and an Asian American becomes the next President of the United States. Chances are there will be more Asian American cabinet members, ambassadors, and senior officials. Despite historically ignoring Asians before, the media will likely elevate coverage of Asian Americans. You could strategically lean into your Asian heritage.
Like it or not, people tend to take care of those who share similar backgrounds, which is partly why minorities often face an uphill climb. Just look at your company’s executive leadership, your school’s senior administrators, the committee that votes on awards, or even your recreational sports league.
Even in incredibly diverse cities like San Francisco or New York, leadership circles often show surprising homogeneity. It’s not blatant discrimination, that’s simply how human nature works.
2) New CEO At Your Company
Now imagine your company’s new CEO is Tongan, and you discover you have 5% Tongan ancestry. Thanks to identity diversification, you suddenly take your first trip to Tonga, learn a bit of the language, immerse yourself in the culture, and bring up the Tongan rugby team in casual conversation with the CEO.
Given how rare a Tongan CEO is in America, you’d almost certainly forge a stronger personal connection than colleagues without that cultural link.
3) New Mayor in Town
Imagine your new mayor is Jewish and even attended the same private high school you did. You’re 6.25% Jewish and share that connection.
At the next mayoral fundraiser, you could ask him what he and his family did for Yom Kippur, then mention your own observance. After reminding him of your donation, you highlight your company’s experience with a city housing project you’re bidding on. Who knows. When it’s time to award the contract, the mayor might give you the nod for building such a strong personal connection.
Goodness knows our old San Francisco mayor handed out plenty of favors to friends and family. But some considered this government graft, which is partly why she lost her re-election campaign.
4) The Strong Return Of DEI
And if the DEI movement gains momentum again? Even if you are part of the majority, you might take a page from Senator Warren’s playbook and emphasize your sliver of ethnic heritage – say 0.1% to 1.6% – to improve your chances of getting into school, landing a job, winning an award, or securing a deal in an environment where identity carries extra weight.
Merit will always matter most in getting aead. But at the margin, belonging to a highly sought-after group – whatever it happens to be at the time – could tilt the odds slightly in your favor. At the very least, your identity could decide a tie-breaker in this ultra-competitive world.
The more identities you can authentically tap into, the more adaptable you become. Identity diversification allows you to align yourself with whichever group is in power, making it easier to navigate an uncertain future.
Time To Learn More About Who You Are
Getting ahead takes hard work, intelligence, and luck. But we also know that people naturally gravitate toward those who share similar backgrounds. That’s why it’s worth making the effort to understand your ethnicity and heritage more deeply.
Even if you feel it’s too late for you, it’s certainly not too late for your children. They are the ones who will have to navigate an increasingly complex and competitive world.
Unless you plan to be a solopreneur, don’t be naive in thinking merit alone will take you to the promised land. Learn how to build relationships and blend in with the powers that be. Some may call this “playing corporate politics” or “being a chameleon.” I see it as a natural strategy for survival.
What do you think? Do you believe identity diversification is a smart way to get ahead, or is it gaming the system? Have you ever benefited—or been held back—because of your identity? Should people highlight even tiny percentages of their ancestry, or should there be a threshold for claiming a heritage? And finally, how much weight should identity carry compared to merit in shaping success?
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