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Yahoo
31-07-2025
- Business
- Yahoo
6 Unique Money Challenges First-Generation Americans Face — and How To Overcome Them
Being a first-generation American often comes with unique financial challenges. From setting goals and building credit to planning for retirement, the journey can feel overwhelming without inherited financial knowledge or support. For You: Check Out: GOBankingRates spoke with financial experts who shared six key considerations to help first-generation Americans navigate and thrive in the U.S. financial system. 1. Navigating Unfamiliar Financial Systems One of the first challenges is learning how to navigate a completely new financial system. Without parent guidance, even basic tasks like opening a bank account or understanding interest rates can feel intimidating or overwhelming. Start by searching for free online resources and looking into local community programs or nonprofits that offer financial literacy workshops. Many cities have support centers that provide tools for budgeting, building credit and planning for the future. 2. Building Credit From Scratch Andrew Lokenauth, money expert and founder of Be Fluent in Finance, said his parents arrived in the U.S. from Guyana with just $20 in their pockets. Their experience taught him some unique lessons about building wealth from scratch. Lokenauth said starting his credit journey was rough. His parents never had credit cards — they operated strictly in cash. 'I remember getting rejected for my first card application and feeling completely lost,' Lokenauth said. 'Started with a secured card with a tiny $300 limit. It took me about two years of careful management to build up to a 750+ score. Now I help other first-gen folks navigate this process.' Explore More: 3. Balancing Personal Financial Goals With Family Obligations Lokenauth said he understands the emotional and financial pressure of supporting family back home while also trying to balance your own personal financial goals. 'Every month, I'd send about 15% of my income to help relatives overseas,' he said. 'I found a balance by setting up a separate 'family support' account and being upfront about what I could realistically give. I had to learn to say no sometimes — something many first-gen Americans struggle with.' 4. Understanding Tax Implications U.S. tax rules are notoriously complex, especially if you're managing international remittances or trying to claim dependents abroad. 'The U.S. tax system might as well be rocket science when your parents can't help,' Lokenauth said. 'I made some expensive mistakes early on. Now I understand how to maximize deductions for sending money overseas and when it's possible to claim foreign relatives as dependents.' It's a good idea to work with a tax professional familiar with international tax issues, especially if you support family members abroad or receive gifts from foreign relatives. 5. Building Generational Wealth When it comes to building generational wealth, passing along knowledge is just as important as any investment you can make. 'Being first-gen means we can blend the best of our parents' financial wisdom, like living below our means, with modern wealth-building strategies,' Lokenauth said. 'We're creating our own playbook that honors our roots while building a stronger financial future.' 6. Planning for Retirement Without Inherited Financial Knowledge or Support Many first-gen Americans didn't grow up hearing about 401(k)s, pensions or retirement savings. That makes the idea of planning for retirement even more daunting. 'Get as close as you can to maxing out your employer retirement plan, especially if it offers automatic enrollment,' said Dennis Shirshikov, head of growth and engineering at and an adjunct finance professor at CUNY. 'Increase your contributions by 1% each year until you get to 15%.' He also recommends exploring tools that make retirement planning more accessible. 'One nontraditional tool is a subscription-based financial coaching app that connects you to a certified coach for a flat monthly fee, making personalized retirement planning accessible to those who might not otherwise be able to afford professional advice,' Shirshikov said. Bottom Line First-generation Americans face distinct financial hurdles, but with the right knowledge and a little planning, those challenges can become building blocks for long-term success. Staying informed, setting clear goals and boundaries, and taking steady steps forward can help create lasting financial security — for you and future From GOBankingRates 5 Steps to Take if You Want To Create Generational Wealth I'm a Financial Advisor: My Clients Who Retire Early All Do These 3 Things 4 Things You Should Do if You Want To Retire Early Dave Ramsey: The 3 Worst Mistakes People Make When Trying To Build Wealth This article originally appeared on 6 Unique Money Challenges First-Generation Americans Face — and How To Overcome Them Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
23-07-2025
- Business
- Yahoo
Expert: 4 Types of Investments To Avoid While Trump Is in Office
One strategy for investing involves the President of the United States. Investors and analysts try to predict which companies and sectors will benefit the most from the anticipated policies of the Commander-in-Chief. Trending Now: Consider This: At the same time, some investors find value in trying to avoid investments that may not pay off with a certain person in the White House. 'I've managed portfolios through multiple presidencies, and I'm seeing a lot of investors make the same mistakes they made during Trump's first term,' said Andrew Lokenauth, a money expert from Be Fluent in Finance. 'Based on my experience, here are the key investments to avoid.' Sector-Specific ETFs According to Lokenauth, sector-specific ETFs based on campaign promises are a huge trap. 'During Trump's first term, I watched countless investors pile into energy ETFs thinking his pro-drilling stance would send oil stocks soaring,' Lokenauth said. 'Boy were they wrong — energy stocks stayed flat despite all the 'drill, baby, drill' rhetoric.' For You: Defense Stocks Defense stocks are another one on the list of those to avoid for Lokenauth. 'Sure, Trump talks tough on military spending, but I've noticed these stocks tend to perform better under Democratic presidents — counterintuitive, right? Plus, the massive defense budget is already priced in,' Lokenauth said. Chinese Stocks Per Lokenauth, Chinese tech stocks are particularly risky right now. 'From my portfolio experience, the trade war rhetoric plus tech restrictions create too much uncertainty,' he said. 'I lost about 15% on some Chinese holdings during Trump's first term before I wisened up and sold.' Environmental, Social and Governmental (ESG) Funds 'Environmental, Social and Governmental (ESG) funds are also problematic,' according to Lokenauth. 'While I personally support sustainable investing, Trump's anti-regulatory stance could gut environmental protections and create headwinds for clean energy companies. The sector dropped roughly 20% in his first year last time.' While Lokenauth said there are some types of investments to avoid while Trump is in office, he added a warning about making big investment shifts. 'And here's something most advisors won't tell you: Avoid making any major portfolio shifts based on presidential policies,' Lokenauth said. 'I've learned this lesson the hard way. The market cares way more about interest rates and corporate earnings than whoever's in the White House.' Editor's note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on More From GOBankingRates Mark Cuban Warns of 'Red Rural Recession' -- 4 States That Could Get Hit Hard Clever Ways To Save Money That Actually Work in 2025 Mark Cuban Tells Americans To Stock Up on Consumables as Trump's Tariffs Hit -- Here's What To Buy This article originally appeared on Expert: 4 Types of Investments To Avoid While Trump Is in Office
Yahoo
22-07-2025
- Business
- Yahoo
I'm a Self-Made Millionaire, but I Could Have Been Richer: My 3 Biggest Regrets
Every self-made millionaire has a different story of how they attained their wealth. While there are countless ways to build up your bank account, each approach requires focus, goals, commitment, a little luck and smart moves. Learn More: Check Out: For Andrew Lokenauth, a finance expert who leverages his Wall Street background to educate his millions of followers seeking investing and personal finance advice through his newsletter, Be Fluent in Finance, he found a strategy that got him to the top. Today, he's a successful entrepreneur who helps others increase their net worth, but he also lost a significant amount of money to financial mistakes that he estimates cost him a staggering $5 million in wealth. 'The worst part is that most were completely avoidable,' he said. Lokenauth has impressively achieved multimillionaire status, but his path wasn't easy — is it ever? He still has regrets, but reveals how he overcame his financial blunders and how others can avoid them in a candid interview with GOBankingRates. Regret #1: Not Maxing Out My 401(k) For employees with access to a 401(k), Lokenauth advises taking advantage of it and maxing it out. 'My biggest regret was not maxing out my 401(k) in my early 20s,' he said. 'I was making good money — about $100,000 to $300,000 — but I only contributed enough to get the company match. I thought I was being smart by keeping cash for opportunities.' The 'rookie' mistake cost him $1 million to $1.5 million in compound growth, he estimates. Explore More: Regret #2: Pulling Out of Investments Too Soon Lokenauth used timing to work in his favor early on, but timing wasn't on his side later when he misread the market and pulled out a large portion of his portfolio during a downturn — his second major regret. 'It was my failed attempt at timing the market,' he said. 'I was thinking I could outsmart everyone else and missed the recovery completely. The thing is, I was convinced I had special insight into market patterns.' That move cost him around $400,000 in lost gains. Regret #3: Letting Great Real Estate Deals Slip By Lokenauth's third regret is not buying certain properties when he had the chance because he thought the asking price was too high. 'That same property's worth four times more now,' he said. 'Sometimes I drive by it just to torture myself.' Despite these costly missteps, Lokenauth made some other smart moves that paid off in a big way. Timing Is Key When Building Wealth In 2008, the U.S. was in the midst of the Great Recession — the economic downturn triggered by a housing crash. The following year, Lokenauth graduated. And while many would have considered that bad timing, he didn't. 'While everyone was panicking, I was buying,' he said. 'Properties in NYC were practically on sale — and looking back, those real estate investments were game-changers. Same with the stock market.' How You Spend Your Salary Matters Besides turning a bad economy into an opportunity, Lokenauth's finance degree opened doors to high-paying jobs in the $100,000 to 300,000 range. But his paycheck didn't make him rich — it was how he invested his money. 'I lived well below my means and invested aggressively,' he said. 'We're talking 50% to 70% of my income going straight into investments — S&P index funds and tech stocks.' Boring Investments Work Best The real wealth builder for Lokenauth was what he invested in. He called it a 'boring-but-effective investment strategy.' 'I dumped money consistently into S&P 500 index funds and some tech stocks,' he said. 'Nothing fancy — just steady contributions month after month. And man, those early tech investments, particularly in companies everyone uses daily, really paid off. I also got into Bitcoin relatively early.' Lessons From Financial Mistakes Lokenauth may have lost a lot of money along the way, but he also learned valuable lessons that helped him become a multimillionaire. Understand how to pay taxes. 'I structured my business completely wrong in the beginning, paying way too much in self-employment taxes,' he said. 'A good CPA would've saved me at least $100,000 over those first few years.' Now he has a full team of tax professionals — expensive but 'worth every penny.' Don't wait for the perfect real estate deal. 'I missed countless good opportunities,' he said. 'My philosophy now is simple: If the numbers make sense and the location's solid, pull the trigger.' Don't overcomplicate investments. 'I spent way too much time chasing complex investment strategies when simple index funds would've done better,' he said. 'All those hours researching individual stocks, options trading, and hot tips from investment groups… Meanwhile, my boring index fund portfolio has consistently outperformed my active trading.' How To Avoid These Wealth-Building Mistakes Lokenauth not only advises his clients, but regularly shares tips through his newsletter and social channels on how to sidestep investing pitfalls. Here are five methods he recommends: Have a tax strategy from day one. Lokenauth says he saves 35% more on taxes annually just by structuring his finances correctly. 'That's money that goes straight into investments instead of to Uncle Sam,' he said. Assemble your wealth-building team early. Hiring professionals like tax strategists, financial planners and attorneys is essential. 'Sure, it costs $50,000+ annually now, but they've helped me structure deals that returned multiples of their fees,' Lokenauth explained. The power of boring investments can't be overstated. There's nothing wrong with basic index funds, and they require minimal effort. 'These days I put 80% of new money into index funds and only play with 20% in more speculative investments,' Lokenauth said. Timing matters — but don't wait forever. Don't hold out for the picture-perfect deal in real estate. 'I could've doubled my returns by starting five years earlier — just make sure you understand the risks, because overleveraging can wreck you fast,' he explained. Protect your assets. Lokenauth said he lost $200,000 in a lawsuit because his LLC structure wasn't set up correctly. 'Now everything's properly separated and insured — this seems obvious, but many skip this step until it's too late,' he said. Becoming a self-made multimillionaire doesn't happen overnight. For Lokenauth, the first million came after five years of savings and investing his salary. But the real wealth? That took a decade. 'That's when compound interest and appreciation started doing the heavy lifting,' he said. 'My early real estate investments doubled — then doubled again.' In addition, his index funds grew steadily, and his early tech and Bitcoin investments paid off. For Lokenauth, the first million was the hardest to achieve — but after that, his money started working for him. 'My investment income eventually surpassed my salary — that's when things got interesting,' he said. The road to millions was bumpy for Lokenauth, but small habits, like saving an extra $1,000 a month, made a huge difference over time thanks to compound interest. 'The core approach was pretty straightforward: Earn, save, invest, repeat,' he said. More From GOBankingRates 5 Steps to Take if You Want To Create Generational Wealth I'm a Financial Advisor: My Clients Who Retire Early All Do These 3 Things 4 Things You Should Do if You Want To Retire Early Dave Ramsey: The 3 Worst Mistakes People Make When Trying To Build Wealth This article originally appeared on I'm a Self-Made Millionaire, but I Could Have Been Richer: My 3 Biggest Regrets Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
18-07-2025
- Business
- Yahoo
Should You Use Crypto To Purchase a Home? 4 Methods and Their Risks
If you're a fan of crypto, perhaps you've been thinking about the various ways to incorporate it into your financial life. Perhaps you've seen headlines claiming crypto mortgages are on the rise as the new way to buy some homes. Learn More: Read Next: However, before you set out to grab your next house with crypto, there are some precautions to keep in mind. Here's what financial experts told GOBankingRates about certain methods and their risks when using crypto to purchase a home. Convert-To-Cash Method Andrew Lokenauth, a money expert from Be Fluent in Finance, said the most straightforward method he's used with clients is converting crypto to cash first. 'I just helped a client last March sell $600,000 in bitcoin for their dream house in the suburbs,' he said. 'The thing is, most sellers still want good old-fashioned dollars, and this approach causes the least headaches with lenders.' Trending Now: Crypto-Backed Loans 'Let me tell you about a client who tried using a crypto-backed loan,' Lokenauth said. 'The market tanked right before closing, and they got hit with a massive margin call — lost about $75,000 in collateral. Not fun explaining that one to their partner.' Smart-Contract Escrows You may also want to take a look at escrow and mortgage opportunities that use crypto in the purchase of a home, but may offer some risk protection. 'It's possible to leverage your crypto for real estate purchases by using smart-contract escrows or stablecoin-pegged mortgages, which automate payments and reduce counterparty risk,' according to Chad Willardson, founder and president of Pacific Capital and City Treasurer of Corona, California. 'Tokenized property platforms allow fractional ownership, softening volatility by spreading exposure across multiple investors.' However, per Willardson, crypto's price swings remain a major risk — buyers should hedge with stablecoins or convert to fiat at closing. Blended Financing According to Willardson, regulatory ambiguity can slow or derail transactions, so work with title companies experienced in digital assets. 'As an alternative, consider blended financing: part traditional mortgage and part crypto loan to balance innovation with stability,' Willardson said. More From GOBankingRates 3 Luxury SUVs That Will Have Massive Price Drops in Summer 2025 The 10 Most Reliable SUVs of 2025 The New Retirement Problem Boomers Are Facing This article originally appeared on Should You Use Crypto To Purchase a Home? 4 Methods and Their Risks Sign in to access your portfolio
Yahoo
18-07-2025
- Business
- Yahoo
Should You Use Crypto To Purchase a Home? 4 Methods and Their Risks
If you're a fan of crypto, perhaps you've been thinking about the various ways to incorporate it into your financial life. Perhaps you've seen headlines claiming crypto mortgages are on the rise as the new way to buy some homes. Learn More: Read Next: However, before you set out to grab your next house with crypto, there are some precautions to keep in mind. Here's what financial experts told GOBankingRates about certain methods and their risks when using crypto to purchase a home. Convert-To-Cash Method Andrew Lokenauth, a money expert from Be Fluent in Finance, said the most straightforward method he's used with clients is converting crypto to cash first. 'I just helped a client last March sell $600,000 in bitcoin for their dream house in the suburbs,' he said. 'The thing is, most sellers still want good old-fashioned dollars, and this approach causes the least headaches with lenders.' Trending Now: Crypto-Backed Loans 'Let me tell you about a client who tried using a crypto-backed loan,' Lokenauth said. 'The market tanked right before closing, and they got hit with a massive margin call — lost about $75,000 in collateral. Not fun explaining that one to their partner.' Smart-Contract Escrows You may also want to take a look at escrow and mortgage opportunities that use crypto in the purchase of a home, but may offer some risk protection. 'It's possible to leverage your crypto for real estate purchases by using smart-contract escrows or stablecoin-pegged mortgages, which automate payments and reduce counterparty risk,' according to Chad Willardson, founder and president of Pacific Capital and City Treasurer of Corona, California. 'Tokenized property platforms allow fractional ownership, softening volatility by spreading exposure across multiple investors.' However, per Willardson, crypto's price swings remain a major risk — buyers should hedge with stablecoins or convert to fiat at closing. Blended Financing According to Willardson, regulatory ambiguity can slow or derail transactions, so work with title companies experienced in digital assets. 'As an alternative, consider blended financing: part traditional mortgage and part crypto loan to balance innovation with stability,' Willardson said. More From GOBankingRates 3 Luxury SUVs That Will Have Massive Price Drops in Summer 2025 7 Tax Loopholes the Rich Use To Pay Less and Build More Wealth How Much Money Is Needed To Be Considered Middle Class in Your State? This article originally appeared on Should You Use Crypto To Purchase a Home? 4 Methods and Their Risks
