Having arrived in America at the age of four as the child of immigrants, I’ve been able to observe the adjustment to American life of hundreds of immigrants just like my family.
Most fascinating to me is that immigrants arrive poor, not knowing the language or culture, have little skills, and on top of that, have multiple children to feed and take care of.
Yet despite all that, within 10-15 years, these same immigrants will have landed fairly comfortably in America’s middle class. They’ll be homeowners, have several cars, have a decent job, and their children will go on to have even better lives financially. For immigrants the American dream of prosperity seems alive and well.
Economic research confirms my observations. Immigrants initially experience high rates of poverty, but this declines rapidly with each additional year they spend in the US.
Other research finds that children of immigrants are far more upwardly mobile than children of American natives. This means children of immigrants end up with incomes similar to children of much wealthier and better educated native parents.
How do they do it?
This article compiles my observations on how immigrants are able to boost themselves out of poverty in a relatively short time.
1. Frugal with Money
Immigrants do not waste a single dollar. Growing up, waking up early on Saturday mornings to check out yard sales for good deals was routine. I don’t think I got my first new pair of shoes until I was in 5th grade, and then only because it was required to join the basketball team.
Restaurants were seen as a waste of money, home cooking is much cheaper (and healthier). On road trips, we would pack our own food and drinks. How about fast food? Nope, we didn’t have that either – too expensive. Gas stations were for gas only.
Much of the immigrants’ focus is on not wasting money and getting the most for each dollar spent. Once in the mindset of saving money, there are many ways to cut down on lifestyle expenses. Is it ideal? Maybe not, but it’s a highly effective strategy if you’re trying to escape poverty.
Where is that saved money placed? Most commonly, into saving up for a house. Or obtaining a better, more reliable car. Expenses on consumables are minimized and instead put into at a minimum, durables (like cars), and even better into financial investments (homes and businesses).
2. Leverage Your Network to Find Jobs and Opportunities
Because of their shared experience as immigrants, the network, usually facilitated through the local church, is very tightknit.
The firm someone works for is hiring? They’ll be sure to share that here. You want to find out the hours of the local food banks and which one has the best food? You can find that out here too. Is there a farmer that’s done mechanical harvesting and allowing people to pick up the left-over crop for free? Yup, you’ll hear about this here too.
This network is an immensely valuable asset to the immigrant. More than bits of information and deals, industry specific know-how is also passed on. Information on navigating the home construction process with the local government, which careers are worth pursuing, and so on are all shared here.
If an area of the US is doing particularly well economically, immigrants are often the first to know through this network, which spans the US.
3. Move to Opportunity
Immigrants’ willingness to move to where the jobs are is one of the biggest reasons for their economic mobility, according to research. This is one of the nice things of being new to America, you aren’t really tied down to any one area. So, if your cousin tells you North Carolina is the land of milk and honey, it’s that much more likely you’ll take advantage of this valuable information and move there.
If the town they’re living in is dying, immigrants will bite the bullet and head out, something natives are often unwilling to do. Geographical mobility of workers is healthy for the US economy and is actually one of its strengths relative to other countries. Immigrants contribute to this in great part, as does America’s history of being a nation of immigrants.
4. Get an Education in Something Practical
Immigrants do not go to school unless they know that it will pay off, period. There is no family expectation that they will get a college degree, in fact, they’re probably the first in their family to be attending college and their parents probably don’t know what they’re studying. So, if you see an immigrant in college, they’re probably not studying library sciences, anthropology, or history.
You’ll find them in STEM fields like engineering, computer science, nursing, medicine, and so on. Education is a very purposeful undertaking, and the purpose is to enable you to get a better-paying job after graduating. Few immigrants go to college to discover or (merely to) enrich themselves. This is a luxury they do not have.
Many will go into the trades, which require a short period of training, yet pay well and are in high demand. These include electricians, maintenance technicians of all kinds, CDLs for trucking, or job-specific training required to work for a local mega-firm (think assembling planes for Boeing).
5. Start Your Own Business
How does someone become wealthy in America? It doesn’t require too much thinking to realize that it’s primarily through being a business owner. Recognizing this, many immigrants pile into business ownership.
Within the business sphere, their language limitations and lack of cultural knowledge matter less. They are able to work with other immigrants and speak their own language throughout the day. They find their customers appreciate their work, both for its quality and affordability.
Even if they do not rely on a business as their primary source of income, many will have side business ventures to supplement their income stream. Fixing cars on the weekend, doing side construction jobs, or even building their own home as a way of quickly building equity, are all common.
6. Be Financially Strategic
Immigrants are financially strategic with everything they do. Before going to college, they know what degree they’re going to get, what their job prospects are with it, and how much it is likely to pay off.
Before buying a used car, they will know what the rough price of the car is, and what a good deal is. If it’s a bad deal they won’t buy it. This goes back to making every dollar spent count.
This goes even more for major decisions like buying a home. They will make really sure the home they are buying is a good deal before buying it.
This comes down to doing your due diligence. It’s common sense but often isn’t done. Immigrants do it because they can’t afford not to.
7. Become a Homeowner as Soon as You Can
For the immigrant, renting seems to be a process in which one throws their money away month after month. Thus, the main financial goal for most immigrants is to get into a house as soon as possible.
By owning a home, they pay roughly the same amount for living as they did while renting, while recouping much of that payment by paying off the mortgage. Additionally, for every year lived in that house it grows in market value.
Given that the home was purchased after doing due diligence and ensuring it was a good deal (if they didn’t just build it themselves), this simple move into homeownership pays off handsomely.
8. Work Hard
Immigrants are legendary for their work ethic, and I must say that the legends are generally true. One illustrative example is that of my father, who upon arriving in the US at age 30 with three kids, worked full time in the evenings as a janitor and attended the community college full time during the day to get a technical degree and learn English. Stories like this are common.
It is unheard of for the child of immigrants to live in his parent’s basement and play video games. Immigrants who are able to work, generally work.
There you have it, how immigrants escape poverty hopefully a bit demystified. I’d love to hear your thoughts below.
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