Identity Diversification May Be As Important As Investment Diversification

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.

Proof Elizabeth Warren Believes She Is Native American -Senator Warren practicing Identity Diversification
A 1986 registration card for the State Bar of Texas for Elizabeth Warren with her Race indicated as “American Indian.” Courtesy of the State Bar of Texas

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.

Personal Scores that measure personality by race

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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Todd
Todd
2 days ago

Hard to say how much of this post is tongue-in-cheek, but I’m inspired to embrace my checkered past.

According to 23 And Me, my heritage includes a healthy mix of Irish, English, Scandinavian, and Neanderthal. I was born in the USA roughly 65 years after my great grandfather immigrated to the USA and ended up in Minnesota. My grandfather was born there and eventually headed west to Washington state. He married my grandmother in the late 1930s and she was from Ireland.

My wife’s mother and father grew up in Nazi Germany and immigrated to the US in 1960. My father-in-law then served in Korea and Viet Nam in the US Army Airborne.

So Sam, how should I optimize my heritage (and more importantly, my children’s heritage) given that I’ve never been to England, Germany, or Ireland for that matter? My father is Canadian, but he abandoned my mother and I in the early 1970s. I learned later that he spent a decade in the Canadian prison system.

I’m struggling here because I feel like I’m missing out on some opportunity that I deserve and entitled to claim. I heard many Irish were caged and brought to America as indentured servants. That could be my calling for reparations since I’m definitely more than 0.1% to 1.6% Irish.

My uncle married and Inuit and lived in Alaska for more that 35 years. My first cousins live in a small fishing village on the Aleutian coast and hunt moose on snowmobiles and AR-15s (not joking).

I guess my overall point is that ideally we are all Americans, regardless of where we came from. We should celebrate our heritage and our family history, but gaming the system like Elizabeth Warren feels dirty.

Ana
Ana
2 days ago

Thinking for 7 years about what Elizabeth Warren did in the 1980s sounds like you are holding a lot of grudge…

marq
marq
3 days ago

Too funny…DEI is good until you are not the demographic de jour. Reminds me of cultural revolutions that would cull the deplorables, undesirables or capitalists esp in communist countries during the 1900’s. Meritocracy, not demographics, should be the primary in judgement.

ClemenceDane
ClemenceDane
3 days ago

Ps. I don’t even think the people who voted for her approved of her Native American stunt. I think they voted for her despite that. So I wouldn’t take away from it that “50% of Americans approve of this.”

ClemenceDane
ClemenceDane
3 days ago

I know you were being tongue-in-cheek about Elizabeth Warren, but she is a terrible role model! At least her type of “identity diversification” is totally dishonest. I would rather continue to speak up and push for meritocracy than try to diversify my identity. While I am 100% European, I could probably pull a couple of other non-race-based identifications out for DEI purposes, but I have no interest in playing that game. I think it’s great that you are teaching your kids about their Hawaian heritage, but you should not have to do that for them to have an equal education and equal chance of success in life. It’s a game that none of us will win if we keep playing it.

I am 5/8ths Swedish and yes, I learned the language and history in college and later got a Fulbright to study in Sweden. I’ve also been to the Swedish Genealogical Institute and traced my family’s ancestry. I am one eighth French and have also learned French. The last two eights are Welsh and Scottish and yes I have studied Welsh! And I’ve spent summers in Wales at a language institute.

However, I think DEI is doing terrible damage to our universities and workplaces. The D in DEI does not mean diversity of viewpoint or background. It means people of every color all thinking the same way. Equity means holding some back in the misplaced hope that it will help others succeed. Inclusion often means excluding the right people so that the remaining few feel “included.”

I think the ideal system would be blind admissions processes. The way things are right now this would mean asians would rise to a much larger share of university students, more than whites, blacks, and hispanics.And that would be fair! Admissions should be based on merit – potential, work ethic, and ability. I think we should also stop making everything about identity and giving out points based on “oppression.” It warps everything and as someone else said, it’s unAmerican. Everyone should have an equal chance to get ahead with hard work and academic nurturing. Now, does that mean we have to overhaul our underfunded schools in the poorest parts of the country? Absolutely. We need to study what works to help kids from poor and working class backgrounds learn and come up to speed. It’s been done in various experimental schools. We need to take the best ideas from the types of teaching, facilities, and resources, and as a country make sure that those schools are all brought up to snuff. To leave anyone behind is UnAmerican.

Todd
Todd
2 days ago

I would wager that Stanley Zhong was rejected precisely because of DEI nonsense, in which high performance Asians are discriminated against by Progressives that deem them “white adjacent”.

Tyler
Tyler
1 day ago

I cannot disagree with your conclusion more, Sam. Stanley Zhong is being rejected entirely BECAUSE of DEI nonsense. If you had a blind admissions process, he would be a “shoo-in.”

Rick
Rick
3 days ago

Hey Sam – longtime reader, who wrote something similar about a year ago:

Diversified Portfolio of Identities [The Way of Work]
I come at it from a little different angle, less about ancestry, more about where we place value in ourselves. For me, it was all about work, which left me in fragile ground after I reached independence. I tracked my career mode portfolio, through a career break, then guessing at future me (a good exercise).

As I wrote:

What fragile beings we are, with so much stock in one thing. We monitor our identity intensely like the daily ups-and-downs of the market. Everyday needing the value to go up, never able to withstand even the slightest, momentary dip.

Because without this identity, who are we?

Thanks for what you do,
Rick

April
April
4 days ago

Great post! I am a first generation Chinese American immigrant. The sentiment is generally yeah we need the Asians to do the actual work, but wait, they better be quiet not ask for anything because they look so different and are never quite “America”. At the same time, there are a lot of communities that Asians thrive. We are all fellow humans and share more similarities than we believe. The love and respect could be extended to people with different opinions. We could agree to disagree and still live in harmony.

Liam
Liam
4 days ago

Sam,

I’m not going to even dip a toe into this as I am 100% Euro (although I can at least claim that all my grandparents were immigrants), however since you mention Hawai’i:

Polynesians had (and many still have) a deep connection to the sky because it wasn’t just pretty to look at, but necessary knowledge for survival. As a result, their view of the Moon (for example) was very different. We have four/five names for Moon phases. Hawai’ians had a phase name for each day. Check out the video “Mele Helu Pō (Hawaiian Moon Phase Song & Handgame)” for a great example that kids will enjoy. I’m happy to see their language come back in school as my own ancestral language is now spoken by less than a third of the people back in the Old Country.

Jean
Jean
4 days ago

Seriously, I realize this blog is about financial planning. But what is happening right now in the U.S. which is a bunch of social class walls and divides, plus gross misperceptions about one another left vs. right, lack of understanding what dictatorship govn’t movement even looks like (some of us have family members who immigrated from military dictator countries), WILL and is already having an impact on some economy and daily living.

Then Trump of course trying to restrict U.S. companies to hire foreign talent for various reasons. I get it since the talent should exist in U.S. if the stellar candidates will apply AND relocate thousands of miles to another state.

There are exceptions since Canadian nurses from southern Ontario around Windsor, cross daily to work in U.S. hospitals.

Just saying we have a historic, major changes going right now in U.S. that is causing increased confusion….ie.delay of U.S. employment rate info. that is useful to the business world, health of U.S. firms …and for investor confidence. Investor confidence predicated on a stable, U.S. govn’t. which right now is increasingly to foreign investors (like me), looks cloudy and ready to fragment.

That believes in diversification and leveraging the best U.S. talent by using DEI is 1 of the tools. It is not the only tool.

Jamie
Jamie
5 days ago

Let’s see. Have I ever been held back because of my identity? I don’t think so. At least not that I was aware of. However, there were several times in my life when I was discriminated against and teased because I looked different. And that felt absolutely terrible.

Do I support learning about our own heritage and family history? Yes. Do I support being inclusive and diverse? Yes. And I also fully support merit. I also like “blind auditions” where people are not judged based on how they look. The modern day example is Love is Blind where relationships are built without seeing each other. When I grew up it was symphony auditions behind a screen where you were only identified by a number and how well you performed.

While situations like that certainly can’t be applied to everything in life, it’s something to keep an open mind about. Nice food for thought in this article. We certainly live in a complex world.

Zamahundo
Zamahundo
5 days ago

Great concept! And makes a ton of sense to diverse yourself to better blend in and grow with the changing times.

I’m frankly shocked there’s not outrage to what Senator Warren did to help boost her identity.

It’s like, let my people kill your people and take your land, and now that I’m in a position of power, to claim your ethnicity and heritage to help me get ahead as my people make reparations through granting higher college admissions, jobs, and power through DEI initiatives.

But Warren is smart. She used the reverse one drop rule to help her get ahead. And she probably knew few would challenge her, given the historical precedence.

Tyler
Tyler
5 days ago

Sam, at risk of being politically incorrect (not that this really matters), I’d like to offer a solution to this problem. We need to all, as a society, stop caring so much about our “identities.”
Teddy Roosevelt gave a speech about 100 years ago in which he said “There is no room in this country for hyphenated Americanism.” He meant that there is only one kind of “American” – not German-American, Mexican-American, or Asian-American.
My ancestors are mostly British and German. We don’t speak any German anymore. We are what you would call “fully Americanized.” We used to call the USA a “melting pot.” Now we talk about “multiculturalism” – why? We have one culture – American culture. When we, as people, immigrate to America, we adopt American values, beliefs, and practices – that’s what it means to be an American. This idea of giving people special treatment for being different is anathema to everything it means to be American – that is – unamerican. Should we start seeking special treatment and spaces for German-American, Italian-American, Spanish-American, French-American, etc.?
Rants aside, and I know this will spark some backlash, this is also good for meritocracy. Why and how do you promote one group over another? How do you determine who is oppressed and who is oppressor? With demographics constantly changing, how do you measure “equity?” These terms are nebulous and ineffective. They distract from work, productivity, and the mission of virtually all productive endeavors – even charitable work, which should be for the good of all people, not just select groups, races, sexual orientations, you name it.
We seem to have gone full circle on this issue since the mid-20th century. I hope we can come back to a more equal understanding of what it means to live in a free society – one without DEI, without labels, and without giving special treatment to some groups while alienating and suppressing others. Otherwise, we are likely to return to a much more primitive time and lose all of the things that once made us great.

Christine
Christine
5 days ago
Reply to  Tyler

SOOOO true Tyler! Great points for sure.

Kyurem
Kyurem
5 days ago
Reply to  Christine

Hi Christine – May I ask if you are a white American who doesn’t speak their ancestral language? Thank you

Christine
Christine
5 days ago
Reply to  Kyurem

I am a white American that does not speak my ancestral language. I like his idea of being American- refreshing.

Tyler
Tyler
2 days ago

There is no “box” for that. The box just says “white.”

Jean
Jean
5 days ago
Reply to  Tyler

I didn’t read anything in Sam’s article on “different” treatment for hypentated Americans.

I am a Canadian-born Chinese and lived my whole life in Canada. I will die in Canada. I have no interest migrating to another country for retirement.

Our work force in decision-making roles in North America, will not change until those in power who walk around oblivious of their privilege.

I have only privilege because I have command of the English language on all fronts..it is the world’s power language in business. My other privilege which I earned so hard as a low-income child of immigrant parents is my university Canadian education. It is a degree that employers understood its value to match against their job ad qualifications.

Otherwise if you saw me on the street as a stranger, I could have be a mainland Chinese immigrant, right folks?????? THis is life for non-whites in North America. In some ethnicities we do NOT have too many immigrants. Some are 2nd, 3rd and 4th generation brown citizens in our biggest cities.

Maybe some folks should interracial marry and live for years.

Diversification of identities allows this: knowing and speaking more than 1 language well. That can open doors your markets in business relations. It is walking into a room, and knowing instinctively how to switch your behaviour to the room’s team culture.

BECOME proud to diversify with your skill set, knowledge of more than 1 culture (because your family was born into it) in your business and personal relations…for life.

A person becomes better and advocates for those who are treated unfairly. ie. what is going on with ICE deportations in U.S. which has included by U.S. citizens. Come on, folks!!! A Canadian should not have to point out this out to you.

Kyurem
Kyurem
5 days ago
Reply to  Tyler

I’ve noticed the white Americans generally think this way, because they are the majority and have the luxury to have their race set as standard, so far when people refer to someone as American. But hopefully, that’s changing with more diversity.

Could you also be a white American? I’m just curious as this view of taking away the hyphen is generally what I’ve observed mostly from white Americans.

The more removed you are from your cultural heritage, the less proud you are of it. But being American itself is also great. I just think it’s good to remember your ancestors.

Christine
Christine
5 days ago
Reply to  Kyurem

I would agree…I am 3rd generation polish so it’s getting watered down for sure sadly. I am sad for our future grandchildren that will be watered down even further. My husband’s family struggled in Armenian & barely made it to the US in 1917 so I understand his proudness as well as others who’ve struggled like so many do.

Tyler
Tyler
2 days ago
Reply to  Kyurem

Calling someone “white” is like calling someone “brown.” It erases their “diverse identity.” So if we care about identity politics, it should be “all” or “none.” We are either German-American, Italian-American, Portuguese-American, French-American, Spanish-American, Swiss-American, and on and on… Or nothing. This unequal suppression and mistreatment of some for others (what some call “reverse” racism) is causing an extreme amount of resentment, especially in the younger generations. They are acutely aware of what is happening.

Tyler
Tyler
2 days ago
Reply to  Kyurem

Part of the reason “white” Americans want the hyphen “taken away” is because theirs was already taken away. That’s what I explained in my original comment – going back 100 years ago, when our ancestors were immigrants from European countries, they were told to stop dividing each other and to embrace one, unified, American culture. This is a historical fact and Teddy Roosevelt’s speech is only one well-documented example of this fact. I do not see this as a privilege in 2025, because you are actually rewarded for the opposite.

April
April
4 days ago
Reply to  Tyler

America has the resources to help the bottom 50% with basic life needs without taxing the top 45% working ones. The polarizations among average people, white, blue, yellow, brown, pink whatever, are driven by the billionaires and people in power. When the bottom is fighting against each other, the top is safe and the power stays because the mob fear and rage could be exploited to gain more power and wealth.