AAPI Financial Resources and Support

As such a diverse group, the Asian American and Pacific Islander community encompasses many different nationalities and cultures. It’s no different when finances come into play. The community can be seen at both ends of the economic spectrum, earning more and less than other demographics.

The wealth gap among Asian Americans and Pacific Islanders shows “Asians in the top 10% of the income distribution earned 10.7 times as much as Asians in the bottom 10%,” according to Pew Research Center. Yet, this community still faces financial disparities in building wealth. Some Asian Americans and Pacific Islanders may have recently immigrated to the U.S., while others are second- or third-generation.

A few obstacles, such as high cost of living, education and income, may contribute to this divided wealth gap. It then creates further challenges Asian Americans and Pacific Islanders have to overcome, which they can. First, by addressing the challenges and then making moves to be more knowledgeable about money.

Asian Americans are a very diverse population and one of the fastest-growing racial categories in America. According to the U.S. Census Bureau, in 2017, 22.2 million of the U.S. population was of Asian descent. The National Resource Reinvestment Coalition also estimates that by 2065, the Asian population could reach 14% of the entire U.S. population. The Asian American population can also include those who immigrated and those whose families lived in the U.S. for generations.

The term “Asian Americans” could include descendants of China, India, Korea, Japan, Pakistan, Thailand, Vietnam, Hawaii, Burma, Samoa and the Philippines, among other nations. Asia is the largest continent in size and population with 48 countries.

Although the movie “Crazy Rich Asians” portrays a charming and wealthy Asian lifestyle, Asian Americans have become the most economically divided racial group in the U.S.

According to Pew Research Center, the Asian American and Pacific Islander community has the most significant income inequality, with the top 10% of Asian American earners making almost 11 times more than the bottom 10% of earners in a 2016 study.

Pew Research Center also showed a similar pattern in 1970. The top 10% of Asian Americans were earning about six times as much as those in the bottom 10%. It reports that from 1970–2016, there was a 77% increase in this wealth gap. Comparing the wealth gap among Asian Americans to other racial demographics, this is “a far greater increase than among whites (24%), Hispanics (15%) or blacks (7%)” from 1970–2016.

Even with 46 years between these two studies, those at the top continued to get wealthier, while those at the bottom experienced less growth. The income inequality among Asian Americans may keep getting wider over time.

Four factors — immigration, education, income and cost of living — may influence this income inequality.

While the income inequality is significant, Asian Americans still face a few money challenges — such as caregiving for multigenerational households, lack of opportunities for leadership roles and student loan debt. Addressing these challenges could help you develop a better plan to budget, save and invest your money.

A 2018 Prudential research study reports that Asian Americans, both foreign-born and U.S.-born, are caregivers and provide financial support to another person in the household, such as a spouse, parent, child or another family member. Their financial goals consist of providing care to their family, leaving a significant inheritance to their family, purchasing a home, and helping their children or future children with college tuition and a down payment on a house. With these goals, some Asian Americans would need to work and earn more.

Some Asian Americans can afford a home or more properties. For others, it may require more planning to build enough money for a down payment. Although the median household income for Asian Americans is higher than 39% of the national average, most of the population lives in costly urban cities — and for some, it will be in addition to taking care of another family member. Because of this, their income may not bring in a sufficient cash flow when they are ready to buy a house.

With labels such as the “model minority," Asian Americans may not be present in the glass ceiling conversation for management or executive roles. However, a Harvard article discovered that Asian Americans were less likely to be promoted into Silicon Valley’s senior positions, but they were very likely to get hired in technical roles.

Although Asian men and women hold qualified credentials, they are highly underrepresented in executive roles. This invisible barrier is termed the "bamboo ceiling" and can be an additional challenge connected to the wealth gap among Asian Americans as they work to increase their income.

A 2018 Prudential study found Asian Americans who are foreign-born, on average, are saving and investing about 47% of their monthly income. For U.S.-born Asian Americans who have higher median incomes, they are contributing 36% of their monthly income into investment and retirement plans. Comparing this to the general population, most people are allotting 10%. The study also shows that Asian Americans are more “comfortable managing their own investment portfolio” than the general population.

With employers providing 401k and retirement plans, the study discovered that foreign-born Asian Americans are more likely to use these options than U.S.-born Asian Americans and the general population. The research also notes a higher percentage of U.S.-born Asian Americans are more likely to own a business or work as independent contractors than foreign-born Asian Americans. A high percentage of foreign-born Asian Americans are working in full-time positions.

In a 2018 Center for Law and Social Policy (CLASP) study, about 3 in 4 students have unmet financial need and aid when it comes to higher education. For Asian Americans, they “have the greatest amount of unmet need, regardless of the institution they attend.” Asian Americans also have the highest dollar amount needed to attend college compared to other demographics. For a four-year public institution, its study shows 79% as unmet financial needs for Asian American students, which is closer to the average of all students at 75%.

The income inequality among the Asian American population could be a contributing factor to the unmet financial needs. The cost and location of the institution and the international students from Asia could also be factors.

Many useful resources and tools are available to help you thrive financially, whether you have immigrated to the U.S., have a low income or are looking for ways to continue growing your money. You can find several financial services and programs, advocacy organizations, community support groups and housing assistance resources below.

• Asian American Organizations You Need to Know: Diversity Best Practices published a list of 20 professional Asian American organizations you can join. You can find organizations for advertising, engineering, journalism, legal rights and healthcare, and organizations for Asian American subgroups, such as the Japanese American Citizens League (JACL) and Korean American Coalition (KAC).
• Asian Pacific American Chamber of Commerce (APACC): The Asian Pacific American Chamber of Commerce’s mission focuses on business relationships for Asian- and U.S.-based companies. It also provides resources to Asian Pacific Americans through mentorships, information to help make strategic business decisions and a support network to build successful businesses.The U.S. Pan Asian American Chamber of Commerce is a nonprofit organization. It represents Asian- and non-Asian-American businesses and professionals, focusing on business, sciences, the arts, sports, education, entertainment, community and public service. USPAACC provides education, advocacy support and networking opportunities.
• Asian American Business Development Center: AABDC helps Asian-American businesses succeed in a mainstream, competitive marketplace by expanding opportunities and promoting their contributions. It also strives to encourage Asian-American companies to take an active role in policies to help minority businesses.

• The Asian Community Fund at the Boston Foundation: This organization is a permanent endowment that increases awareness of the Asian American community. It provides helpful resources and grants to nonprofit organizations serving Asian Americans who have a low income and are economically disadvantaged and/or immigrants.
• OCA - Asian Pacific American Advocates: OCA is a national nonprofit organization. It has several programs to help the Asian American and Pacific Islander community to foster development, leadership and engagement. Its members advocate for the well-being of Asian Pacific Americans in social, political and economic-related conversations and policies.
• National Coalition for Asian Pacific American Community Development (CAPACD): CAPACD is a coalition of local organizations working to help Asian Americans with a low income. It consists of over 100 organizations that assist Asian American and Pacific Islander communities and neighborhoods. It offers data and research, policy and advocacy and programs to empower Asian Americans and other communities of color. CAPACD’s programs focus on housing counseling, small business, creative placemaking and financial capability.
• Asian American Advocacy Fund: Located in Georgia, the Asian American Advocacy Fund strives to include Asian Americans, Native Hawaiians, Pacific Islanders and other immigrant populations in policy conversations at the federal, state and local levels. Its mission is to improve the lives in these communities through equality, fair treatment and self-determination.

• Pacific Asian Consortium in Employment (PACE): PACE supports about 40,000 low-income and underserved Pacific Asian and other diverse communities in the Los Angeles area. Its mission is to solve challenges and increase opportunities in employment, education, housing, environment and business.
• Asian Americans for Community Involvement (AACI): AACI works with marginalized and vulnerable ethnic communities in Santa Clara County. It is a large community-based organization that helps its community members improve their well-being, including physical and mental health.
• Asian Pacific Community in Action (APCA): Located in Arizona, this nonprofit organization helps local Asian American, Native Hawaiian and Pacific Islander communities. It focuses on health equity, access to healthcare and defending community rights.
• Asian Pacific Islander Community Leadership Foundation (ACLF): Its mission is to help Asian Pacific Islanders develop leadership skills and encourage civic engagement. ACLF offers training and support to those dedicated to public service, community empowerment and social justice. Over 150 participants in its Community Leaders Program (CLP) have advanced in leadership positions related to social justice.

• East Bay Asian Local Development Corporation (EBALDC): EBALDC serves the Oakland and East Bay communities. Its mission is to help low-income residents live in affordable homes and stay in healthy, vibrant and safe neighborhoods. The nonprofit organization also provides social and financial services to support the Asian and Pacific Islander communities and other diverse populations.
• Asian Americans for Equality (AAFE): AAFE works with Asian Americans and other disadvantaged communities in the Manhattan and Queens areas. It has created over 1,000 affordable rental units and helped first-time homebuyers finance their mortgage payments.
• National Asian American Coalition (NAAC): The NAAC’s Homeownership Center offers down payment assistance and counseling for the homebuying process, understanding mortgages and developing a credit profile needed to buy a home. The coalition works with Framework to educate homebuyers and provide them with the information they need to buy their home through an online course, which costs $75.
  
  

Roselle Caballes is a Filipino-American millennial. She works at a fin-tech company as a sales enablement specialist and an online marketing and visibility coach. One of her passions is raising awareness on the challenges affecting the Asian American population.