Understanding Financial Literacy in Immigrants and Non-English Speakers in the United States

The financial landscape is becoming increasingly complex, with the rise of diverse financial products, technologies, and new investment options, making financial knowledge more crucial than ever. However, immigrants and non-English speakers in the United States face significant obstacles in acquiring the financial literacy essential to their economic security. This paper examines the relationship between financial knowledge, immigration, time spent living in the U.S., and English language proficiency. Drawing on data from two national data sets, the research reveals that non-native English speakers demonstrate lower financial literacy in the United States, proportionate to their English proficiency. New immigrants also exhibit poor financial sophistication, which improves the longer they reside in the U.S. While financial education courses positively affect financial literacy, their impact varies across demographic groups. This paper concludes by underscoring the critical need for financial literacy initiatives tailored to immigrants and non English speakers, to increase familiarity and remove barriers to the U.S. financial system. Expanding access to financial education and banking services is essential for integrating these populations, ultimately enhancing their economic security.