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'Education is the most important thing'

According to loan officer Niki Wong, Asian-American families view education as a key investment.

Tess Vigeland: And now let's turn to Niki Wong. She's a loan officer at a credit union in San Jose. She's very familiar with the way people in the Asian American community handle their money both personally and professionally. Niki, welcome to the show!

Niki Wong: Thank you.

Vigeland: Let's just start with a mass generalization, which perhaps is not fair, but at least it lets us start somewhere: How different, if at all, are an Asian American's financial priorities compared with other ethnic American groups?

Wong: I think in general they're very debt-averse, they like to have a lot of liquid assets. For example, if you had a dollar, they probably put away half of that for savings.

Vigeland: Wow.

Wong: And probably use the other 50 percent to make things work.

Vigeland: What do they do with those liquid assets?

Wong: I think honestly, they older generation, it goes under a mattress, still to this day. I think they just feel like that's the safest way to have money under the mattress. Or a lot of them still invest in gold.

Vigeland: Ah!

Wong: They need to that tangible asset. They need to feel, touch and see it.

Vigeland: What do they spend their money on?

Wong: They do spend a lot of their money on... If you look at a higher ticket items, they do go out and save and they do buy homes. Then they'll buy obviously the nice cars. But they do spend a lot on education for their children. That to them is a priority. You do see a lot of the parents will go out and invest in a home in a very good area that has a great school district, and they will pay the extra money, because they know they'll get a great education for their children and they're willing to pay that extra cost on that piece of real estate.

Vigeland: Where does this savings culture come from?

Wong: You know, I don't know whether it's just traditionally the culture or it just comes from the parents. I know that for myself, my mom would always ask me, "Are you saving any money?" or she'll ask my sisters, "Are you putting money away?" And to her, she always tells us, "At the end of the day, you need to make sure you have that rainy day supply." So I'm not sure, again, if it comes from the culture itself. Back then, when your basically what you generate and what you saved up is what you can use, because there isn't this thing called "credit," where you can go out and borrow. So I think that's the mentality -- you, yourself is the source of your funds.

Vigeland: So do they use credit as a general rule?

Wong: To this day, my parents don't use credit. I mean, if they want to purchase something, they pay with cash.

Vigeland: And how about you?

Wong: I will use credit for obviously a home mortgage because it's a large sum. But for the most part, credit card debts, I don't have any. Everything's paid off monthly.

Vigeland: Good for you! Pat on the back. We spent some time with this professor, Gene Cooper, from USC down in Chinatown this week. And I was actually struck -- and I actually said to him -- by what seems like an obsession with money. I mean, you have all these symbols that all they're about is money and prosperity and making sure you have all the luck you possibly can when it comes to money. How do you square the circle?

Wong: You know, if you have money, it equates to authority. And so wealth and authority are synonymous. So therefore, they feel if they have money, they're able to go out and be able to not worry about what someone is gonna tell them they can or cannot do.

Vigeland: Are there any generational divides that you're seeing particularly as a banker? As families come to the U.S., are children a little less apt to adopt that saver culture?

Wong: I think, you know, as more families are becoming second, third generation, if that family unit doesn't have a lot of influential measures, then I think that part of it kinda goes away, you lose some of that culture. But I think if the unit is strong and that gets instilled and then that gets adopted and then that gets, obviously, followed and exercised and it'll be passed onto their children and children's children, and so on.

Vigeland: I know you have children, so those lessons being passed onto them, presumably?

Wong: Exactly. So right now, as you know it's Chinese New Year and they get lucky money. So, my children, I, at the end of that period, collect their New Year red envelope, I would actually take the amount and they have their own savings account.

Vigeland: Oh that's great. And do they find that interesting and fun?

Wong: They find it fun, because now as they're older, they want to keep their money, because they want to go out and buy their toys. And of course, as a parent, you try to teach them value. Then of course, my little one, who's almost six, every time he has money, he wants to go out and buy this new Lego. And I tell him that we have enough and I try to explain to him the reason why we just can't go out and buy a toy every time as there are children out there who don't have money for food or for clothing. And I do ask him, "Do you want a child to not have clothing or food and buy a toy?" And I ask him a choice and he tells me he'd rather have a child with food and clothing.

Vigeland: Good for him. So you said you are doing the red envelopes. Have you burned money with your kids?

Wong: That is a tradition. I know that my mom does that. We do have our ritual where we pray and then they do an offering of whether it's money or gold or whatever that they think they need in the underworld.

Vigeland: All right, Niki Wong, thank you so much for joining us.

Wong: You're welcome. Thank you for having me.

Vigeland: And Happy New Year.

Wong: And you too. Bye bye.

About the author

Tess Vigeland is the host of Marketplace Money, where she takes a deep dive into why we do what we do with our money.
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We need to teach every American that saving money is critical to their financial future. Knowing the difference between wants and needs can help students and young adults get a handle on their spending. Managing money means making choices. There is never enough money for all your needs and wants, but the Asian Americans in your story know this, the rest of us do not. Simple changes to behaviors can make a huge different. Saving Money is a habit – It does not relate to how much your make.

I once met a couple with an income of $220,000 and they were broke, no savings, no emergency fund, no retirement, I met another couple whose income was about $37,000 per year and they had $380,000 saved.

Small changes can had a big effect, one $3.00 late a day over 20 years = $15,600. At 8% Compound Interest that = $42,384.48 ($15 a week every week).

It is critically important that we teach people how to save money.

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