Workshop on Financial Literacy for Migrants in the United States

By Nancy Castillo
June 14, 2010

Improving financial education and access for migrants can help them build assets and better manage their money, experts said June 14th. “The majority of migrants manage to save money informally, also known as under the mattress, but their assets are still low. Strong financial education and financial access for migrants could transform their behavior and help them build assets,” said Manuel Orozco, Director of Remittances and Development at the Inter-American Dialogue, which hosted a lunch workshop on financial literacy for migrants in the United States.

Participants from non-profits, the private sector, government, international organizations and philanthropic foundations came together to discuss the importance of financial literacy for migrants and efforts to expand this type of education in migrant communities. The meeting focused on a new financial literacy model developed by the Dialogue and plans to strengthen and expand the initiative. The Dialogue initiative, born in 2001 with the support of the Annie E. Casey Foundation, aims to help migrants—often characterized as one of the most vulnerable minorities of society—build assets and have access to the financial system. The idea expanded to include family members of migrants that receive remittances.

The strategy has seen success in both the United States and in six countries where the Dialogue has worked with nearly 50,000 remittance recipients in partnership with financial institutions. Maria Jaramillo of Microfinance Opportunities said sharing lessons learned is something practitioners should consider in order to develop best practices to measure the effectiveness of financial literacy programs. Around the table, participants agreed that financial education is a lifelong process, so follow up is also a major factor for success, especially in budget and credit matters.

Participants discussed the importance of tailoring quality financial education to fit the different needs of migrants. They agreed that accompanying conventional content with migrant-specific financial literacy, such as advice on filing and receiving tax returns and information on the costs of certain services, would help migrants better manage their lives. Irene Lee of the Annie E. Casey Foundation stressed the importance of financially preparing for various aspects of immigration, such as citizenship and legalization fees or even deportation.

When discussing opportunities to expand sustainable financial education services, participants stressed the importance of being creative with limited funding and creating partnerships. Orozco presented the low-cost idea of partnering with universities in order to create internship programs where students of economics and/or international affairs interested in migration would serve as educators. Other low-cost and sustainable ideas included ensuring college students train the next rounds of educators, training migrant community leaders to provide financial education, doing workshops instead of classes, being able to provide personalized referrals of local resources to migrants, and using local media as a way to shed more light on the issue. 

Deyanira Del Rio of NEDAP noted that becoming a financial educator requires significant training. “Not anyone can do financial education; people need to be prepared in order to become part of it,” she said, adding that proper training and sharing of best practices is important for the future of the field.

Orozco called for a greater public policy focus on financial education, citing the need to go beyond current FDIC efforts. He said it would be useful to engage in efforts that work with transnational families on both sides, as well as initiatives for other migrants communities and underserved populations such as African Americans.