A Rising Chinese-American Investment Manager Shares the Top Financial Tips She’d Give Her Working-Class Parents
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- Mindy Yu grew up in Queens, New York, in a working-class household that survived from one paycheck to the next.
- Currently, she works as an investment manager and mentors individuals on expanding their riches.
- If she had the chance to travel back in time, Yu would advise her parents to concentrate on saving for their retirement, set aside funds for unexpected expenses, and put any additional money into investments.
As the head of investment strategies at Betterment Mindy Yu assists numerous individuals in making astute investments in the market and increasing their wealth. However, Yu has risen from modest origins herself.
She was raised in Queens, New York, within a Chinese immigrant household that barely made ends meet with each paycheck. Her dad operated independently as a fix-it man, whereas her mom stitched away at garment shops in Manhattan’s Chinatown. Eventually, her mother left her job because Yu and her two brothers required greater assistance once schooling began.
They certainly weren’t your typical desk jobs with consistent salaries,” Yu explains to Business Insider. “I have a brother and an older sister, so we witnessed firsthand the challenges faced by my mother and father as they worked tirelessly to support our family.
Once it was time for Yu to attend college, she began investigating various sectors such as fashion merchandising prior to venturing into a career in finance. She shares, “It took realizing the impact of investments and grasping how the finance sector assists individuals with planning, saving, and contemplating their monetary future for me to have my epiphany.”
She says, "My personal experiences have significantly altered my perspective on providing guidance to clients. It’s crucial to ensure they avoid falling prey to similar fears and missteps in their investments. This drives me to constantly learn from my own errors so we can prevent our clients from repeating these mistakes."
If she could go back in time, Yu stated that she would offer her parents this trio of financial recommendations.
1. Concentrate on planning for your retirement
Yu states, "They were so preoccupied with assisting the three children navigate their way through college that they didn't concentrate on preparing for their personal retirement They shouldn't rely solely on Social Security benefits.
Although her parents didn't necessarily have access to conventional retirement savings such as a 401(k) or Roth IRA Yu regrets not discussing retirement plans with her parents sooner in her life.
She says, "Actually, it’s not too late to begin these discussions with your parents right away. There won’t be an option for you to secure a loan down the road to cover both your cost of living and healthcare expenses. These costs will keep increasing each year, which could become quite burdensome."
2. Initiate an emergency savings account
An emergency fund should be at least three to six months’ worth of living costs, usually maintained as an emergency fund. high-yield savings account , ensuring quick accessibility during emergencies.
Yu acknowledges that her parents aspired to establish an emergency fund, yet faced significant challenges due to their circumstances. She explains, “Arriving in this country without knowing English poses substantial difficulties when attempting to earn a livelihood. It’s akin to finding yourself stranded in an unfamiliar place without the ability to communicate—something essential for survival and financial stability.”
Yu recalls that during her childhood, her family owned an old vehicle which occasionally malfunctioned right in the middle of the highway. If she had the chance to travel back in time, Yu would advise her parents about setting aside money specifically for emergencies like these instances when their car stopped working on the road.
3. Put any additional money saved into investment.
Yu wishes her parents had begun putting money into the stock market earlier.
She states, "While my parents were attempting to save and adjust to life in the U.S., they had very limited funds, and financial planning services were quite costly. Nobody would offer them advice unless they came with a substantial sum to invest."
The language gap also posed challenges for Yu's parents when trying to acquire fundamental financial management abilities, such as investment strategies and retirement planning, which could have significantly improved their family’s circumstances.
Yu points out that members of older generations within Asian American communities often lean towards being more conservative investors. She explains, “The emphasis in the community tends to be on saving money bit by bit rather than considering how that same amount could grow through investments. The older generation simply lacks both the understanding and incentive needed to pursue this path.”
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The initial publication of this article took place in May 2022.
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