Hispanos, celebramos su valor para la economía de USA
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In 1968, President Lyndon Johnson declared the commemoration of Hispanics Heritage in the USA, later President Ronald Regan established that it would last one month, starting on September 15 until October 15.
In this article we pay tribute to the effort and contribution that Hispanics have made to the development of the American economy.
In addition to pointing out those aspects in which we still need to continue working to improve personal and family finances.
We are going to rely on two publications by Unidos.org and a recent McKinsey study, entitled “The Economic Status of Latinos in America”
Hispanics represent 18% of the American population
Did you know that Hispanics represent more than 18% of the American population, with more than 62 million people?
This makes us the largest ethnic group in the United States and it is expected that by the year 2060, for every 3 Americans, one will be of Hispanic origin.
Between 2010 and 2020, the number of Hispanics increased by more than 23%, a significant number compared to the average growth of the general population in the USA, which was 7.4% (Source: New American Economy Research Fund) .
Hispanics an engine for the American economy
Consolidated Latino households produce more than 1.2 billion dollars and in 2019 they paid more than 309 billion dollars in taxes.
Regarding the workforce, Hispanics cover more than 17% of workers in the US, and it is estimated that by 2030 this number will be more than 22%.
In the construction and agriculture sectors, Latino participation is fundamental: For every 10 workers, 3 are Latino, and for every 6 construction companies, one belongs to Hispanics.
Hispanics not only participate in the US workforce, we also have a great entrepreneurial spirit and that is why by 2019 there were more than 2.5 million entrepreneurs.
An interesting fact is that Latinos are one of the ethnic groups that start more businesses per capita in this country.
It has been proven that Hispanic immigrants in the United States have a higher educational level than those who arrived in previous years, before 13% of them had an educational level and now that number has risen to almost 22%.
There’s still a long way to go on equal terms
The difference between the income of an average American or “White American”, compared to what a Latino earns is substantial; since, for every dollar that an American earns, the Latino earns 73 cents on the dollar. These disparities are even greater when analyzed from the point of view of men and women, since the income received by them is much lower.
In other words, while the average annual income in the USA is higher than $52,900, a Latino who was not born in this country earns an average of $31,700 and a Latino born in the USA earns $38,848.
According to McKinsey, if a Hispanic were paid closer to the average amount, collectively this amount would add up to approximately $288 billion dollars, which would be a new catalyst for the country’s economy.
We have a lot of work to do in optimizing family wealth
In the area of family finances is where we have the greatest challenge:
The median wealth of a Latino family is $36,000; while, for the “White American” his wealth is $182,000, that is, it barely reaches a fifth.
On the other hand, 16% of American families have assets greater than a million dollars; however, in the case of Hispanics this number barely reaches 3%.
When we analyze the causes we have many reasons:
Hispanics started from scratch:
• We started without a base, there are many first generation immigrants, which has caused us to start from scratch or at least with very little. 34% of Latino families have assets below $10,000.
• The study carried out by Dave Ramsey indicates that a large part of the country’s millionaires have achieved their fortune from scratch. But, we must take into account the language barriers and the other challenges of being an immigrant, not taking it as an excuse, but adding the degree of difficulty.
Lower educational level:
The number of Latinos in senior executive positions has been rising exponentially; but, the educational level of the large number of immigrants who arrive in the country must still be improved, which is why we clearly see that those Hispanics who are born in the United States and achieve a better education obtain better income than their relatives.
We must highlight with great joy that day by day the professionals who exceed high educational levels in their families are growing, being the first to graduate from a University.
Low knowledge of financial education
I recently heard that about 15 years ago most of the Latinos who came to the country did not even have a bank account and did all their operations in cash, their bank being the mattress of their homes.
Arriving in a country with a totally different system, where you must think in the long term and not fall into the temptation of consumption and the use of cards, are fundamental habits that you must achieve in order to achieve financial independence.
We do not have the custom in our homes of hearing the importance of having a retirement account, therefore the acronyms of 401K or an IRA do not make sense, when rather they are the most used way by the American to grow their wealth in the time with tax benefits.
One of the things that we should pay special attention to from the McKinsey report is that Latinos do not seek financial advice. Rather, they consult on these issues with friends or family, who may have the best will, but perhaps not the knowledge.
Let’s look at Dan Sullivan’s book, which teaches us that “it’s not about how, it’s about who”, which is why professional support is essential.
Founder & CEO Advise Financial
Alonso is a “CERTIFIED FINANCIAL PLANNER™” who is dedicated to increasing the Financial Well-being of nurses, physicians and successful immigrants in Florida and Texas. With more than 20 years of experience in the world of finance, always working for the best interest of his clients, under fiduciary criteria.
