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5WPR, Courtesy of Sid Pailla, V2 Communications, Small Girls PR.
- Insider asked four CEOs of fintech companies for advice they'd give immigrants who are new to the US.
- Every CEO emphasized the importance of building credit as early as possible.
- Make a plan for emergency remittances, which is money you send home to family members.
The United States has more international migrants than any other country, according to Pew Research Center.
Compared to someone born and raised in the US, immigrants face unique challenges when meeting financial goals.
Insider spoke with four CEOs in the fintech industry who are immigrants or children of immigrants. Here are their five tips for immigrants trying to gain financial footing in the US.
1. Establish your credit as soon as possible
Each CEO stressed the importance of building credit as soon as possible.
When immigrants move to the US, their credit reports don't transfer. Compared to someone who was born and raised in the US, it's harder for immigrants to establish their credit history.
Lily Liu, founder and CEO of rent reporting app Piñata and a first-generation Chinese-American, says your credit score "really is your passport to the modern economy," even if you may not think about it day-to-day.
Liu suggests starting with reporting rent payments. Historically, credit reports only capture on-time mortgage payments, making it harder for renters to build credit. Rent reporting makes it easier for immigrants to build credit without opening a credit card.
Once your rent payments help you establish credit, Liu says you can begin taking out safer lines of credit. Liu says one option is using a credit card to pay for recurring expenses, like utility bills, then paying the balance off in full each month.
Liu says good credit can help you access future rentals, car loans, mortgages, and even job opportunities from employers who pull your credit report as part of the application process.
2. Get free financial advice from your local credit union
Sid Pailla, CEO of the app Sunny Day Fund, which helps companies contribute to their employees' emergency savings fund as a workplace benefit, encourages immigrants to get financial advice from their local credit union.
Pailla, whose family came to the US from India when he was 10 years old, says credit unions will work with you to help you "create a budget and plan for you to achieve your next immediate goal."
He also suggests working with a credit union to set up multiple accounts — for example, a checking account for everyday expenses, a savings account for future goals, and another savings account for your emergency savings fund.
While getting an account at a bank or credit union can be challenging for immigrants in many cases, some credit unions make it easy for immigrants to apply by allowing you to use a permanent resident card, foreign passport, or Matricula Consular instead of a social security number.
3. Plan for emergency remittances ahead of time
A remittance is a type of money transfer, typically used by immigrants to send money to their family members who live in a different country.
In 2022, immigrants in the US sent $72.7 billion in remittances to their home country, according to the World Bank Group's Migration and Development Brief.
Pailla says about remittances, "That's just a part of the sense of duty that we feel as immigrants. We need to make sure we budget for them upfront and save up for that along the way."
Pailla adds that family members overseas are more likely to ask for additional support three times per year: on religious holidays like Easter or Ramadan, at the beginning of a new year, and when their children's school starts.
Pailla adds that family members in their home country often can't afford these recurring expenses because their monthly budgets are stretched thin.
To the stateside immigrants who often need to foot the bill for their loved ones overseas, Pailla says, "These are fairly predictable cash outflows, so we can plan ahead for that."
He also recommends saving that money in a high-yield savings account instead of sending it all at once or ahead of time so that money can accrue interest until your loved one needs it.
4. Ask your peers for advice
"People move to the US typically for one of three reasons: education, work, or love," says Misha Esipov, cofounder and CEO of Nova Credit, a company that helps US banks and lenders access immigrants' financial records from their home country, providing immigrants access to credit, loans, and mortgages without having to build their credit from scratch.
"I would encourage people to talk to their peers, whoever is a year or two ahead of you," says Esipov, who emigrated from Russia with his parents when he was a kid.
He adds, "Understand the journey they went on, and get their advice for understanding where the best products are."
5. Don't be afraid to take risks
"The advice I would give is to persevere against all odds," says Wemimo Abbey, cofounder and CEO of Esusu, a rent reporting platform that provided 0% interest rent relief loans to their users in 2020 and 2021.
Abbey and his mother immigrated to the US after his father's death. When he decided to start Esusu in 2016, he left a high-paying job in finance.
"At that time, I paid my mother's rent. My mother was emotional and said, 'I thought we made it.' This woman sacrificed everything she had for me to go to one of the best schools. We're in corporate America, and that's the ticket to a stable life," Abbey tells Insider.
However, Abbey says it's important to take risks, especially if your corporate job makes you feel like you aren't reaching your full potential.
Abbey adds, "As an immigrant or a person of color, you cannot accept the status quo. You cannot accept mediocrity."