16 Factors That Affect The Finances of New Immigrants in the United States

Do you know the factors that affect your financial future as newcomers to America?

Welcome to the United States, new immigrant!

Some of you may have done your research from way back in the land of origin (land of birth) and found out that it is not easy (or cheap) to live in the US. But that knowledge did not stop you from envisioning your new life in this land of plenty.

Nope. It did not deter us, either.

Like us, you may have tried to pick the city you want, the size of the house, the price of the house and the amenities thereof.

You may have thought out your housewares and wardrobe and type of car you will drive and the places you want to visit.

As if it was that easy . We should have known better.

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THIS POST BELOW IS ABOUT FACTORS THAT AFFECT FINANCES OF NEW IMMIGRANTS IN THE USA.

WARNING: Read the START HERE page to understand the audience we aim for this post. This post is NOT for the moneyed immigrants who have money to burn, and also NOT for the employer-sponsored ones who are assured of their living conditions by virtue of their specialized and lucrative jobs.

IMMIGRANTS' INEQUALITY OF FINANCIAL RESOURCES

Yes, it is easier for some people to come to the US and start their immigrant lives.

Some of those people have EB visas (Employment Based Immigration Visa).

Some have the non-immigrant H-1B visas (Specialty Occupations, DOD Cooperative Research and Development Project Workers, and Fashion Models).

If you came (or will be coming) stateside on an employer-sponsored visa, which is common among nurses or computer engineer immigrants, then you have a better chance to jumpstart your finances.

Unlike the rest of us.

If you are an EB visa holder, your employer has done the bulk of the immigration processing work and spent money on you to bring you over here. Not only do you have a secured employment with them, but they may also help you find your initial residence here.

Your salary with them has almost guaranteed that you will have a good life moving forward based on how easy you have jumpstarted your life here in this adopted country compared to other immigrants.

You are very fortunate. You have skipped a lot of steps and evaded many heartaches that most of us had gone through.

The average new immigrant, like many of us, do not have a ready employer who will take care of us during the initial stages of our stay. We are on our own, sink or swim.

It is like BYOBm – bring your own bulk of money, which many of us do not have.

We still must look for a place to stay and most times it means rooming family and friends. We still must go through the process of looking for jobs. We may have to take out a loan from family and friends to finance our living conditions as we wait for good fortune to come our way.

From our personal experience, observation and research, we have come up with these lists of factors that can directly affect the financial trajectory of new immigrants in the United States.

WARNING: We repeat. This post may not be applicable to you.

FACTOR AFFECTING FINANCES: Probability of getting a job fast.

As soon as you set foot in the US, you need a source of income, fast. Getting a job is the quickest way to start earning money.

Life still goes on whether you have a job or not – you need to eat, drink, sleep, and wear clothes. You still must travel to work and/or school. Sickness and accidents can happen at any time.

The longer it takes for you to find a job, the faster the bills pile up, unpaid. With unpaid bills, penalties can happen, and your budding credit score may take a huge hit.

If you have a job, you can start saving for things to further yourself and your family – a better place to live, nicer clothes, or saving for education.

The faster you can get a job, the faster you can create income. Your workplace makes it easier for you to create and build connections and networks with others.

Therefore, it is your assignment, dear immigrant, to increase your probability of finding employment FAST!

So, even before you migrate, review your skills and competencies. Check your credentials against the prevailing job market in the US.

FACTOR AFFECTING FINANCES: Sufficiency of the take home pay

When you migrate and you are fortunate to get a job right away, that is a great blessing. Congratulations!

Now, let us talk about the take-home pay.

Take-home pay is the money that gets to you after your employer has deducted fees and withholding taxes.

That take-home pay must be able to cover all your essential expenses – rent, food, utilities, travel expenses, etc.

Of course, it is better if your take-home pay is not just sufficient but there could be some extra left to build an emergency fund and savings.

If some bills are unpaid, penalties can happen and will snowball into higher expenses. And then there’s the matter with the credit score being hit.

When the take-home pay from one job is not enough to cover all bills, that’s when a second (or even a third) job is needed.

- - Do you really need another job?
  - Or do you need a better paying job?
  - Are you in the right career path?

FACTOR AFFECTING FINANCES: Family fund contributors and contributions

How many are you in the family and how many are working? How many are lifting their own weight? How many are freeloaders?

There is strength in numbers, as the saying goes, but it does not always translate to reality.

For example, in a family of 5 where 3 are small kids, only 2 people are tasked to bring home the income.

Or, in a family of the same number (5), even if all are adults and of employable age, if only the head of the household works, the finances will be tight.

MORE CONTRIBUTORS TO THE COLLECTIVE INCOME, THE BETTER.

A two-income family is better than a one-income family – usually these are the adults in the home, the parents. If you and your spouse, for example, are both working – that is better than only one of you is employed.

If your children are also legally employable and have work, then they can contribute to your family expense fund.

If so, the family fund will be more substantial. You can now have quality living conditions – you can afford a bigger place, in a safer but pricier neighborhood or city and have nice things, too.

HIGHER SALARY AND TAKE-HOME PAY, THE BETTER.

Unless you are a miser, it is expected that a bigger take home pay affords better things for you and your family.

You eat better and healthier food items. You can afford better and bigger living spaces. You can opt to have nicer clothes and things.

HIGHER PERCENTAGE OF CONTRIBUTION, THE BETTER.

Let us say that there are four of you in the family who have jobs and each of you brings in $1000 every payday (2 weeks’ pay).

The illustration below shows that if everyone participates and gives more, the fund gets bigger.

Only if everyone participates and gives substantial contribution will the STRENGTH IN NUMBER adage, works.

FACTOR AFFECTING FINANCES: Disability, illness and disorders

If you have family members who need care, attention and medical support, your family is hindered to a great degree from reaching your fullest financial capacity in the shortest possible time. And that’s a fact.

LESSer number of family members with disability, the better

For example, diabetes runs in the family, and you have five in yours who are afflicted with the disease. There is also another immigrant family with just one diabetic member. Your family would be spending more on insulin and related medications compared to the family with lesser number of diabetics.

LESS SEVERE THE ILLNESS OR DISABILITY, THE BETTER

The more severe the disability or disorder of a family member, the more hands and money are needed to support that person.

This means that some of you may have to work part-time or not at all because of the severity of the illness of a family member. This also means that some family members may have to work twice or thrice as much and as hard to cover up for the lost earnings of the caregiver.

FACTOR AFFECTING FINANCES: Avarice, vices and addictions

Unlike DISEASES AND DISORDERS, vices, avarice, and addictions are CHOICES. Your lifestyle choices can be the boon or bane of your existence in the US. Here, there are so many opportunities for accessing the many varieties of these things.

LESSER NUMBER WITH THESE AFFLICTIONS, THE BETTER

It is self-explanatory that if one family has three drug addicts and one alcoholic while another family has ZERO members who has vices – that the latter family has more upward financial potential than the former.

LESS SEVERE THE AFFLICTION, THE BETTER

Vices, addictions, and avarice also have levels of severity.

If the drug addict needs repeated intervention and rehab stays, more money is needed to help him/her out compared to someone who is just starting to dabble into it.

Take Note

Addictions take on many forms. For example, shopping and collecting things can be addictions, too.

A hoarder started as an impulsive shopper and compulsive collector of things. A severe shopping habit may escalate to include excessive credit card debt.

FACTOR AFFECTING FINANCES: Financial obligations related to migration.

Many new immigrants take out loans from family, friends, and financial agencies to afford the expenses and make migration possible.

Therefore, if you took out a loan to afford your migration journey, you are already at a negative financial starting point.

These huge financial obligations must be paid. The debtors not only require to be paid in full but also at the soonest time possible.

You are in an adverse financial condition compared to someone who has no debt to start with. You are working so hard to reach the dream of financial freedom, but the repayment of the loans come first before your hard-earned money can have a chance to get into your savings account.

FACTOR AFFECTING FINANCES: Financial obligations related to family.

Many immigrants, especially those who are from developing countries, are obligated and/or expected to send money and goods to their family back in the old country.

Oftentimes, on a regular basis, too.

Unlike the financial obligations owed to financial institutions and people, this type of financial responsibility – the sending of money to the family – seemingly has no end in sight.

If you are one of these immigrants, you know this unwritten rule: That you will be the source of financial aid for the family (and extended family) in good times or bad.

This means that you will be the de facto financier of weddings, town fiesta, hospitalization, and funerals. You, THE IMMIGRANT, are expected to be always ready and always willing to help.

Whether you are operating out of obligation, or by sincere generosity, one thing is certain: This custom of “remittance” is a hindrance to the faster financial advancement of immigrants, most especially the new ones like you.

Sometimes, you may need to work multiple jobs and long hours just to have enough for yourself PLUS the budget for the ones in need back in the old country.

Nugget of Momsense

The practice of sending money and goods back home, while viewed as an act of generosity on the part of the immigrant, is (for the most part) a practice driven by filial duty and reinforced by guilt:

That the immigrant must share the good life he/she is having.

However, this practice, if not regulated and given boundaries, can be abused and can be a form of enabling.

Some members of the family may rely on the immigrant for everything financial rather than strike and take risks on their own. And, unless given a cap, it would go on for years.

Many of these family members do not even know the blood, sweat and tears that the immigrant went through before that $$ can be had.

FACTOR AFFECTING FINANCES: Location of residence and its applicable laws.

The location in which you choose to take up residence – state, county, city, neighborhood, zip code – can either help you or break you financially.

For example, let’s take California and Missouri as contrasting examples of location and applicable laws.

California has the biggest economy in the US that, if it were a country in 2021, it would be the 5th biggest country in the world – bigger than India and the UK.

California has milder weather all-year-round and is considered ideal by many people. It has an abundance of jobs in varied fields – from tech jobs to farm jobs.

This desirability to live in California has at least two disadvantages:

- - The housing shortage causes high rent and high prices of houses for sale.
  - The sales tax is between 7.25-10.25%, driving the cost of living to one of the country’s highest.

California is an expensive state to live in. According to MYLIFEELSEWHERE.COM Missouri is 20.5% cheaper than California.

In contrast, Missouri has one of the country’s lowest taxes, both income tax and sales tax are at an average of 4.25%, The house rental rates are also very affordable because there is no shortage of them. However, Missouri winters are harsh compared to sunny California and the cold is a deterrent for many people, not just immigrants.

Therefore, as these simple comparisons show, your financial situation can be influenced by, among other laws, the tax and real estate regulations in the place you choose to live.

Nugget of Momsense

There are many factors, not just the taxes, climate and regulations mentioned here. Be sure to do your own due diligence.

FACTOR AFFECTING FINANCES: Location of residence, its crime rate and quality of schools

Your financial situation can be influenced by your location’s predominant social and environmental conditions.

LOW HOUSE RENTAL VS. PEACE OF MIND AND SAFETY

For example, a neighborhood that has high crime rate may boast of low rental property rates. Tempting right? But whatever savings you can have will only be used to make your doors and locks stronger. Worse, someone may break in and rob you or hurt you despite the extra security gadgets and amenities you spent on having.

Furthermore, if the neighborhood has high crime rate, peace of mind is in short supply. In the long run, this may necessitate medical or psychological health intervention for the members of your family.

LOW HOUSE RENTAL VS. QUALITY OF EDUCATION

There are documented links between crime rates and education, meaning the high crime rate neighborhoods have schools with low graduation rates.

If your immigrant child grows up in this type of location and in this quality of schools, you have to consider the possibility of the child being inspired by the prevalent lifestyle in the area.

For many parents, immigrant or not, the highest aspirations for the children and the next generation include better neighborhood, superior schools and better friends and positive influences for them.

Nugget of Momsense

The popular African proverb “It takes a village to raise a child.” brings to mind that what surrounds the child shapes the child.

And remember that the child will grow up and will have children of his/her own, too.

As an immigrant parent hoping to reach financial freedom and create generational wealth for your children (and descendants) – ARE YOU RAISING YOUR CHILDREN IN THE CONFINES OF THE RIGHT VILLAGE?

FACTOR AFFECTING FINANCES: Presence of supportive family and community

The presence of social relations in the US can help you so much.

Social connections can be in the form of:

- - immediate family
  - extended family (clan or group of families)
  - friends from native country
  - church community
  - national heritage group
  - alumni association from native country
  - co-workers and friendships created and formed here in the US

These people can help you find a job or a house or give advice on many things, big or small.

This is not to say that immigrants who come without family, friends, and no immediate community to connect with will not succeed in the US.

We are saying that you can multiply your chances of financial success and possibly shorten your trial-and-error stage if you have these social connections. The collective wisdom, moral, and networking support from them are priceless.

Personal Experiences

Here are a few of our experiences on how family and friends have been helpful with our migration journey:

One of our nephews was able to refer three of his cousins (new immigrants) to the same company he was employed in.
One nephew and my sister-in-law served as co-signors on the contract of our very first apartment. Story here.
We are beneficiaries, several times over, of tickets to concerts and hotel stays from our friends at church.
Group chat between family and friends about current deals and on-going sale on food and other items has helped us save a lot over the years.

FACTOR AFFECTING FINANCES: Openness and tolerance to new ideas and differing opinions

The American society offers so many differing topics, opinions, methods, political views, social norms, and views on civics and the spiritual.

And there is no escaping them, too. The media, movies, schools, and even your next-door neighbor has an opinion on everything.

If you are a new immigrant who is coming from a society where any or all these views, issues and topics are contrary to you and your belief system – you will have a hard time adapting to the American way of life.

And your views, if not managed, may affect the financial aspect, too. Here are three sample scenarios:

SCENARIO 1: You came from a society where women were not allowed to seek employment. If you persist on this belief here in the US, you may run the risk of diminishing your family’s earning potential by not letting the women in your family work and earn.

SCENARIO 2: You worked as a bookkeeper in the old country and your methods were old-school and manual entry – BY HAND into a physical paper spreadsheet. If you refuse to learn computer skills and make the spreadsheet using software, you are saying NO to lucrative bookkeeping employments.

SCENARIO 3: You refuse a job because it is way below your station.

Being open to new ideas can be doors to unheard of financial bonanza for you and your family.

Direct Quote

CALBIZJOURNAL.COM: So How Much Does It Cost To Sue Someone?

It’s difficult to come up with an average number for how much suing someone costs, but you should expect to pay somewhere around $10,000 for a simple lawsuit. If your lawsuit is complicated and requires a lot of expert witnesses, the cost will be much, much higher.

FACTOR AFFECTING FINANCES: Mindful of wellness, safety and security

When you came over to the United States, you did not change, you are still human and mortal.

You must anticipate any possible situation to prevent accidents and illnesses before they happen. Even how small. For example, even a small knife cut may cause a bigger problem if you are diabetic.

With the times we are in, sickness is around every corner. COVID-19 and its variants are not yet vanquished. There is the new threat of monkey pox and new diseases. There is the resurgence of old diseases.

As new immigrants, you cannot afford to be sick and have a medical event. Especially if you do not have a medical insurance yet.

A hospital stay or even an Emergency Room visit will make a huge dent on your finances.

You must take care of all the aspects of your being. You and your whole family, too. In every aspect:

- - - body
    - mind
    - soul
    - spirit

Safety while at home must be taken seriously, too, to avoid possible disastrous situations that may endanger life and property.

Events like fire, flooding, carbon monoxide poisoning and break-ins and home invasion can be prevented with proper safety precautions.

It takes just one of these disasters and you will be down financially, bigtime. That’s why you must be vigilant.

This vigilance also extends to when you are on the road and driving or even at work. One car accident will impact your insurance score and would stay in your records (for 3-10 years in California as per DMV) which spikes up your insurance payment.

If you crash your car to someone else’s car, you have to shell out for repairs for yourself and the other party. Worse, you might get sued, too.

FACTOR AFFECTING FINANCES: Ample contingency plans in place

INVESTOPEDIA defines contingency as

… a potential occurrence of a negative event in the future, such as an economic recession, natural disaster, fraudulent activity, terrorist attack, or a pandemic.

Treat your family unit like a country or a corporation. What would be your plans to protect yourselves from possible financial downturn (accidents, illness, loss of income)?

Your contingency plans should include most, if not all of the following:***

- - Dental insurance
  - Optical insurance
  - Medical insurance
  - Life insurance
  - Critical Illness insurance
  - Pet insurance (if applicable)
  - Renter’s insurance (if applicable)
  - Home insurance (if applicable)
  - Vehicle insurance (if applicable)

Let’s take dental insurance for example. According to DELTADENTAL.COM a family of 4 will spend $1,400 more on preventative dental care alone when they are without insurance.

Without insurances to buffer you, it will be very costly to live in the United States. Better have them in advance before the undesirable event strikes.

***This is not an exhaustive list. You may add more. For example, the emergency family fund is one form of contingency plan.

Direct Quote

LAWGUIDELINE.ORG: Average ER visit without insurance in the US is $2,200.

Other approximate costs: Chest pain $1000, Broken bones requiring surgery is $10,000, Stitches for an accident $500, Sore throat $620, Removal of sutures is $343…

NEWMOUTH.COM: The average price of a simple extraction without insurance ranges from $75 to $250 per tooth.

Surgical extractions, such as wisdom teeth extraction, can cost $300 or more.

Extractions of impacted teeth, which are stuck below the gums’ surface, are more expensive. They can cost anywhere between $350 to $550.

FACTOR AFFECTING FINANCES: Awareness saves money

Sir Francis Bacon said, knowledge itself is power. Having it in advance and adhering to its given information, knowledge, apparently, saves money too!

You are no longer in your own native country where you must have known what is legal and what’s punishable by law.

As new immigrants, you are stepping into a different location – all 50 states of it. In this new country, you must familiarize yourself with the existing federal, state, and local laws and regulations.

Or be ready to pay dearly.

Here are a few examples:

- - Parking tickets in San Francisco CA costs at least $60.
  - San Diego CA, homeowners who have Christmas lights on their houses past February 2 may be subject to a fine of up to $250.
  - In South Berwick, Maine, it is illegal to park in front of Dunkin’ Donuts on Main Street. The penalty is a fine of up to $175 and/or jail time of up to 30 days.
  - In Rockville, Maryland, it is illegal to cuss within earshot of others in public. The penalty is a fine up to $100 and/or jail time up to 90 days.

Know the rules and save serious money and avoid jail time, too.

FACTOR AFFECTING FINANCES: Entrepreneurial mindset and strong desire for financial freedom

Entrepreneurial mindset and the desire to escape poverty are the decisive elements that overpower all the other hindering components in your financial journey as a new immigrant in the US.

You may be a woman from a society where your gender was not given importance and you were not able to discover your potentials.

Here in this country, you have a chance to prove that you can be a vital member of society.

Here you can achieve your dreams of financial freedom, amongst the many freedoms you desire.

You may have a disability that prevents you from having a “normal” job but if you really desire to be employed, there are ways and there are agencies who are willing to assist you.

You may be in the worst situations – speaking of family, crime ridden location, limited education, etc. – and yet you have a strong desire to break free from poverty, you can still come up on top and win.

You must harness all strengths and every little potential you have. You got to market your products, skills, creativity and ideas and monetize them all.

Conclusion

There was so much information given above to consolidate it into a short summary.

So, how about this: You know more about your family and yourself. Compare, contrast, and evaluate the above factors and weigh them against your family’s dynamics.

Consider your present social and financial condition, your family members’ addictions and illnesses, if any, and all other things that you think can affect your financial journey here in the US.

HOW MUCH HAVE YOU SPENT ALREADY?

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With the information given on this post, we hope that it inspired you: That you will come up with inventive and inspired ideas that will work for you. And that you will reach your financial goals on your own unique cocktail of talent and grit that will defy whatever hindrances you will face in this new country.

Do you have anything to add to this list? Let us know.

Please do share this article to a fellow immigrant. Thank you!

MOMSENSE Maria

Maria is just a chatterbox (on a mission.😋)

NO ONE AUTHORIZED her to spew all this MOMSENSE, but she is a complicated cat and so she feels that she must. Be advised and take a spoonful of salt for every opinionated post you read here. And please, please consult a professional for individualized advice on life-altering decisions.

MOMSENSE Maria

Maria is just a chatterbox (on a mission.😋) NO ONE AUTHORIZED her to spew all this MOMSENSE, but she is a complicated cat and so she feels that she must. Be advised and take a spoonful of salt for every opinionated post you read here. And please, please consult a professional for individualized advice on life-altering decisions.

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