Asian Immigrants and Financial Literacy October 3, 2011 University of Maryland Jinhee Kim

Asian Americans Asian descents (immigrants, refugees, and native born) 5.6% of population about 17.3 million (2010 Census). One of the fastest growing minority groups. 67% were foreign born (about half them came after 1990) while a third were native born Distinctive culture and language Highly concentrated: Half of Asians lived in three states: California, New York, and Texas (Asians accounted for 43% in its population in Hawaii and 12% in California)

Asian Immigrants East, Southeast, South Asia Varying ethnic differences: Cultural heritages, economic conditions, political systems, religious practices, and languages Country of Origin (Eight-tenths of Asian) Chinese-Americans (3.8 million) Filipinos (3.2 million) Asian Indians (2.8 million) Vietnamese (1.7 million) Koreans (1.6 million) and Japanese (1.3 million). (Source: 2009 American Community Survey) Other ethnic groups include: Bangladesh, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Nepal, Pakistan, Thailand, and others.

Asian Immigrants Stereotype of “model minority” due to higher socioeconomic status compared to other minority groups Relatively higher education and income on average Ethnic differences (refugees vs. immigrants) High average and large dispersion (polarization) Higher median income with higher poverty rate than non-Hispanic white

Education

U.S. Census 2009 American Community Survey

Median Household Income

Median Income per Capita

Poverty Rate U.S. Census (2007) The American Community

Employment Asia n (%) Asian Indian (%) Chinese (%) Filipino (%) Japanes e (%) Korean (%) Vietna mese (%) Private workers Govn’t workers Self- employed U.S. Census 2009 American Community Survey

Home Ownership U.S. Census 2009 American Community Survey

Home Ownership Total Asian Asian Indian ChineseFilipino Japanes e Korean Vietna mese Monthl y cost/inc ome 37.6%41.2%46.3%48.1%39.4%57.5%56.2% Median House values ($) 357,100360,900428,600328,700408,500387,300258,100 U.S. Census 2009 American Community Survey

Length of Stay U.S. Census 2009 American Community Survey

Speak English Less Than “very well” U.S. Census 2009 American Community Survey

Bank Account Ownership Rhine and Greene (2006) used Survey of Income and Program Participation Bank account ownership of U.S. immigrants Income, net worth, education, family size, length of stay for Asian’s bank account ownership Overall, Asians seem to integrate into the financial market in terms of bank account ownership

Credit Avery, Brevoort, and Canner (2009) Federal Reserve Board Recent immigrants had somewhat lower credit scores than would be implied by their performance. The loan performance of Asians better than the performance predicted by their credit scores. Asians paid interest rates that, on average, were typically lower than, or about the same as, those paid by non-Hispanic whites across all loan.

Asset Ownership Kim, Chatterjee, & Cho (2011) studied home, business, financial asset ownerships with New Immigrant Survey Differences in asset ownership by ethnic groups Significantly different by – Socioeconomic variables: Income and education – Acculturation: Length of stay and English fluency – Country of origin: Asian Indian, Korean, Chinese, Vietnamese, and Philippines – Demographics: Age, marital status, family size

Financial Literacy Education Resources for Asians FDIC Money Smart: The Money Smart for Adults instructor-led curriculum consists of eleven training modules that cover basic financial topics. The instructor-led version is available in Chinese, Hmong, Korean, and Vietnamese

CreditSmart Asian CreditSmart Asian is a three-part series of multilingual guidebooks focused on helping Asian Americans become more informed consumers. Available in Chinese, Korean, Vietnamese and English, the guidebooks provide valuable and culturally relevant information on establishing and maintaining good credit, the steps to homeownership, and the benefits and responsibilities of owning a home. CreditSmart Freddie Mac asian.html asian.html

Visa Asia Pacific MyMoneySkills Introduced in 2002, this online program offers six modular topics that cover the most relevant information needed to meet the daily financial needs of people of all ages. This online resource is available in English, Korean, Thai, Japanese, Bahasa Indonesia, Malay, Hindi, and Chinese.

Planning for Prosperity: A Financial Guide for New Asian Americans The National Coalition of Asian Pacific American Community Development (National CAPACD) and NEFE To help Asian immigrants learn how to benefit from the financial institutions and services in the United States. Its featured information is available in Cambodian, Chinese, English, Filipino, Hindi, Hmong, Korean, Samoan, Thai, Urdu and Vietnamese.

Summary Asians are not the same. Many different ethnic groups. “Model community?” Higher socioeconomic status on average with high dispersion. Over two thirds are foreign born while half came since New immigrants face challenges in integration into U.S. financial market. Very limited data and research on financial literacy and financial management of Asian immigrants. Some financial literacy education programs translated into Asian languages are available while a few local communities provide financial counseling and education programs for Asians. Overall, limited resources for financial literacy education. High average may mask the needs for financial education of many Asians.

References Chatterjee, S. & Kim, J. (2011). Asset ownership of recent immigrants: An examination of nativity and socioeconomic factors. Migration Letters, 8(2), Rhine, S. L. W. & Greene, W. H. (2006). The determinants of being unbanked for U.S. immigrants. Journal of Consumer Affairs, 40(1), U.S. Census Bureau (2007). The American Community-Asians: American Community Survey Reports. U.S. Department of Commerce, Economics and Statistics Administration, U.S. Census Bureau (2010) American Community Survey 1-year estimates [Data summary file]. Retrieved from ed_States U.S. Department of Commerce, Economics and Statistics Administration, U.S. Census Bureau (2011) Survey of Business Owners. Retrieved from filter=SEX;in;001|RACE_GROUP;in;60,61,62,63,64,65,66,67&-geo_id=D&- ds_name=SB0700CSA01&-_lang=en&-fds_name=EC0700A1

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