Being an immigrant has its own challenges, and I was curious to know from other immigrants how they were dealing with their finances. I wanted to find out the unique challenges they were facing and how they dealt with them.
I am excited to present the 5th guest of the interview series, the blogger behind Financial Freedom Countdown. He runs a blog that is dedicated to helping you think differently about your financial challenges and how to live your best life.
I hope you enjoy this interview as much as I did.
1. Can you tell us about yourself? Please include any details you feel comfortable sharing about how long you’ve been in the US, what you do for a living and your income range.
I’ve been in the US for the last 13 years. Came here 12 years ago with only $1000. Did not have any other assets except my education and leveraged my Human Capital to achieve Financial Freedom. I work in the technology sector and highly recommend it as a career. Even if you never work in Tier 1 companies; you will still have plenty of career options in either engineering, management or support and can achieve Financial Freedom comfortably.
2. What was your relationship with money during the early days of your life? How did it influence your finances?
Growing up in a 3rd world country; we did not have much money but my parents were very conservative wrt spending. They only spent what they earned and saved the difference. Investing was never on the radar and that meant a higher percentage needed to be saved. Grew up in a cash-based society and I never even knew credit cards existed till I came to the US and found out how they worked. Since I was the only one from my family here; I had to learn everything about credit cards, investing, retirement accounts, buying a house, etc on my own. I would read a lot and internet search was my best friend. It helps that I do love to read. I have to give credit to my parents for ensuring that I always lived within my means even after my salary and investments grew exponentially.
3. Do you discuss money with your friends, family or colleagues? How do they react when you bring up the topic of money? Is this a taboo subject?
I do discuss finances openly with my family. Money was never a taboo subject growing up and that is something which surprised me about the US.
4. What are some money mistakes you have committed? What lessons did you learn from it?
So many mistakes. Some due to my ignorance and others due to my own foolishness. As I mentioned when I came to the US I started working for a global consulting firm. They had a 401(K) with a very generous match but not knowing how it worked I never contributed to it for 4 years. I also started reading about stocks and watching CNBC so bought individual stocks many of which went to zero eventually. Also, dabbled in options trading and triple leveraged commodity ETFs. The losses I suffered in the early part of my life were more than 50% of my net worth but from a total $$ perspective they were recoverable and did not derail my Countdown to Financial Freedom. I still do invest in alternative assets but it is less than 30% of my total investable assets.
In terms of lessons I would say:
- Have an open mind to learn and experiment.
- Make small bets until you understand the risk/reward and then scale up.
- Protect your capital and always have a backup plan in case you lose all your capital
5. What is your view on debt? Do you carry any form of debt? Has it ever been a source of stress in your life?
My current debt is only my mortgage and I have it due to a very low fixed interest rate. I bought a new car with a loan but paid it off in 6 months. Debt has never been a source of stress and I believe one can use debt strategically to leverage as long as one is financially savvy.
6. How is your money invested? Does being an immigrant have any influence on your investment decisions?
70% of my investments are in the traditional index and asset-backed securities. The other 30% is spread across everything from cryptocurrencies to mining stocks to crowdfunded real estate. Being an immigrant I would consider capital preservation to be the highest priority at this stage and invest more conservatively than I would have if I was not an immigrant.
7. Do you have any specific money situation as an immigrant (e.g. supporting an aging parent or family overseas) that influences your finances?
I do have older parents and my finances are geared towards supporting them. I have not yet made concrete plans at this stage wrt the amount and the nature of the support.
8. Are you aware of the FI or FIRE movement? If yes, where did you hear about it? Are you pursuing (or have you reached) financial independence?
Although from an early age I was great at saving money; I never knew about FIRE until very recently. I heard about FIRE on a podcast and then got the book. Read it and decided that the lifestyle was too extreme. Someone suggested MMM and even that was extreme since I could not envision the low cost of living and riding a bike or buying a used car. I never had a budget and still, do not have an exact one for my spending. But I could now see how all the money I saved could be used. I also came across the 5 regrets of the dying and that had a larger impact on my life.
9. What are some of the apps or tools you use to manage your finances?
I do have a large number (compared to the average personal finance community) of credit cards. I use Mint to check activity once a week.
10. Are there any specific books, blogs or podcasts on personal finance that you’d recommend to others?
I align most with the philosophy of Paula Pant “You can afford anything but not everything” and recommend her podcast. I gravitate towards blogs written by locals
http://fifighter.com/ who is not in love with any particular asset class and is not afraid to highlight his investment mistakes. A word of caution that this blog may be difficult for new readers to follow.
Harry Sit from http://thefinancebuff.com is also a Bay Area local and produces content only when there is something of value to be conveyed.
11. What money advice do you have for new immigrants who arrive in the US?
This is a marathon and not a sprint. Follow other immigrant blogs and my goal by the end of 2019 is to have a comprehensive primer for not only immigrants but also others to follow influenced by my own trials and tribulations.
12. How can people connect with you on social media?
Are you a first-generation immigrant in the US? If yes, would you like to be part of this interview series? This series will focus on personal finance for first-generation immigrants and the unique challenges they face.
You can check out my page Immigrant Finances – Interview Series for more details on how to participate in this series.