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Newly arrived and in need of help navigating our financial system

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Newcomers_Dubis_blog When I came to United States from Colombia in September 1992, I didn’t speak any English. I can still remember the face of the airport employee who kept telling me where my luggage was, but I couldn’t understand anything he was saying. He saw confusion on my face, and with his hands – a little bit irritated – showed me four fingers to indicate that my baggage was at claim number FOUR.

Fortunately, my sister was here and she was very supportive. Even though she wasn’t financially sophisticated, she had a savings account at an institution close to her apartment in Queens, New York. She was paid weekly and went every Friday to deposit her paycheck.

I enrolled in college right away and worked as a waitress on the weekends. One day my sister took me to the bank where she had an account, so I could open my own savings account. Even though she didn’t know much about financial decisions, she knew one important thing: the value of saving, even little by little. My motivation was to be able to go back to Colombia every summer and I did it many times with my own money. Her guidance was the best thing I could have.

Unfortunately, not everyone has a sister like mine.

To help, we developed the Newcomer’s Guides to Managing Money, an unbiased resource for recent immigrants. Take a look and see ways to pay bills, receive money, open a bank account, and compare financial products.

The newcomer’s guides to managing money

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Beneficiary. Collateral. Debit. Fair market value. These terms might look familiar, but what do they really mean? Now imagine how confusing financial language might sound if you didn’t grow up speaking English. According to recent studies, people with limited English proficiency may be more likely to fall prey to frauds and schemes, and it can be harder to manage money on a day-to-day basis. That’s why we’ve developed the Newcomer’s Guides to Managing Money to provide recent immigrants with straightforward information about basic money decisions.

Each guide features short tips to help new immigrants, and people who may be new to the U.S. banking system, avoid financial pitfalls. The guides also include information on how to submit a complaint if you’re having a problem with a financial product or service.

You can download, post, and share the Web-ready versions of the guides in English and Spanish (more languages coming) or order printed copies.

Ways to receive your money

Have you received a paycheck but aren’t sure whether to cash it or put it into a bank account? This guide provides information about receiving wages or payments. You can use this guide to compare the benefits and risks of getting paid in cash, with a check, by direct deposit, or on a card. [English | Español]

Checklist for opening an account

If you’re interested in opening a bank or credit union account, you can use this guide and checklist to make sure you have the required paperwork before opening your account. [English | Español]

Ways to pay your bills

Are you trying to decide whether to pay your rent by check or credit card? Take a look at this guide to compare the benefits and risks of paying regular and one-time bills by check or money order, by direct debit, online, or in cash. [English | Español]

Selecting financial products and services

If you’re trying to decide which financial services are right for you, this guide provides information about common transactions, including ATM cash withdrawals and debit card purchases.
[English | Español]

These guides are part of our commitment to provide people who may be new to the U.S. banking system, including people with limited English proficiency, the information they need to make the best financial decisions for themselves and their families.

We’re also connecting with consumers who use a language other than English by explaining consumer protections and introducing them to our complaint system. Check out more materials available in other languages as well as our website in Spanish.

Here’s why childhood is an important time to learn about money

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Last summer, we learned that U.S. teenagers are in the middle of the pack when it comes to financial literacy, compared to other nations. Preparing young people for a solid financial future is an important job. And much work remains.

Some recent research looks at how young people build financial skills, habits, and attitudes. The research also emphasizes how parents can model and teach helpful financial habits to their children at an early age.

If you have kids, it might surprise you to know that children as young as five years old can be ready to learn about saving and spending. From early childhood to young adulthood, you can build the foundation to enable them to manage their finances as adults.

Here are some key takeaways from researchers that you can put into practice:

Children as young as five can learn about saving

Research suggests that children are “developmentally capable” of saving by age five. A piggy bank or savings account gives them a hands-on way to build a savings mindset. And parents take note: your child may acquire a taste for financial planning that lasts well into adulthood. The same research shows that children who grew up with a savings account were more likely to hold “diverse asset portfolios and to accumulate more savings as young adults.” That’s a powerful piggy bank!

An allowance isn’t just about money, it’s about guiding your child

Access to money from gifts or from a steady allowance, by itself, may not help your child build habits he or she will need as an adult. Research observed that giving an allowance on its own was an ineffective way to build a child’s financial skills—the benefits came when the child also got guidance on saving and budgeting along with the allowance. According to the research, “parental oversight as to how the money is spent, and parental teaching about budgeting and the necessity of saving, was found to be most effective.” So when you provide opportunities for saving and spending, talk to your children about their decisions.

Young people learn from hands-on experiences

Teenagers can practice financial skills and decision-making. As they manage their first paychecks, and the spending and saving choices that go along with them, parents are still a sounding board. Listening and providing guidance to your teenager can provide a safety net, so that he or she can learn from experiences and mistakes (let’s be honest, there are bound to be a few).

Young adults learn financial skills more and benefit when they have opportunities to make their own financial decisions, while still receiving guidance and feedback. For example, a program that included connecting economically disadvantaged youth to a job and savings account, and providing just-in-time financial education, showed promising results. Youth experienced “both an increase in knowledge and an increase in the application of that knowledge.”

For more ideas on teaching your kids about money, check out our resources for parents.

We are also working to help schools or communities provide youth with more access to hands-on learning around financial education. If this interests you, feel free to share our K-12 financial education guide with your local school. Financial educators can also check out the resources available as they serve the community.

The launch of the CFPB financial coaching initiative

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Today, we launched our financial coaching initiative. The launch featured remarks from Director Richard Cordray and Secretary of Labor Thomas Perez, as well as other key program participants.

The live event has now ended, but we’ll have a recording available here soon.

Our financial coaching initiative

Whether you’re a veteran who has recently transitioned to life in the civilian world, or a consumer facing economic challenges, having a trusted, well-informed advisor can increase your odds of success. Our financial coaching initiative will provide guidance to recently-transitioned veterans and vulnerable families in places where they’re already going for help. We’ve joined forces with the DOL and more than two dozen non-profit social-services providers to place 60 certified coaches in DOL American Job Centers and community-centered non-profits across the country. These professionals will provide one-on-one free coaching to help these consumers craft a personalized plan for financial success.

You can download a printer friendly list of financial coaching delivery sites.

Updated on May 26, 2015 to include the financial coaching delivery sites.

Save the date: Join us for a Credit Union Advisory Council meeting in Washington, DC

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Join us for a Credit Union Advisory Council meeting with Director Cordray on Thursday, March 12 from 3 to 5 p.m. EST. During this meeting we will discuss the role of credit unions in cultivating consumer financial education and financial capability.

Consumer Financial Protection Bureau
Auditorium
1275 First Street NE
Washington, D.C. 2002 Washington, DC

This event requires an RSVP. All of our Advisory Board and Council meetings are open to the public.

Please send us an email to RSVP.

You can check out the meeting agenda and event flyer. See you there!

You’ve got goals for your life—and some of them take money to achieve

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America Saves Week infographic

When you look ahead to your future, what kind of changes do you see?

You might envision major changes, like moving to a new city for a new job, starting a family, or helping your kids move out and live on their own.

You might anticipate smaller changes too, like starting a hobby or exercise program, upgrading your home appliances or technology, spending more time with friends or family, or volunteering more. Maybe you want to reduce your debt, or save up for a purchase instead of charging it.

Goals, whether long term or short term, usually cost money to accomplish. That means when you have a life goal, you probably have a financial goal, too.

Life goals—and financial goals—can be small or large, short-term or long-term. Helping consumers reach their own goals is an important part of our mission. Whatever your goals are, here are a few steps that can help you reach them:

  • Set a financial goal. Let’s say you want to go on a vacation next year, and you set a goal of saving $1,000.
  • Break it down into specific steps. You could decide to save $1,000, for example, by bringing lunch from home instead of buying it for $5 a day. Or you could set aside $20 from your pay every week for 50 weeks. Or you could find additional income from an extra shift or side job.
  • Set up the system you need to make it work. Sometimes we forget the small things that can get in our way—like making sure you have the right kitchen supplies and groceries to make lunch every day, or opening a savings account to keep your vacation fund separate. Set up what you need in your life, so that you don’t have excuses to miss your goals.
  • Get help sticking to your plan. You can set up automatic transfers at your bank, moving funds automatically from checking to savings. You can set a weekly alarm on your phone. You can ask a friend to remind you—or join you and save along with you.

America Saves Week can help you get started—and stay on track

Taking place from February 23-28 this year, America Saves Week gives you an annual chance to get started on saving. If your own goals include saving for the future, take the America Saves pledge today, and you’ll stay motivated all year with tips and reminders.

Now is the time to think about how to achieve the changes you envision for yourself. Know what motivates you, then take action. By meeting your financial goals, you’ll make a start on following your life goals.

When thinking about setting financial goals, consider what financial well-being means to you. Learn more about what consumers across the country told us about their financial lives and views of financial well-being.