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<p>Immigrating to the U.S. comes with its share of challenges. From understanding the credit system and taxes to sending money back home, you’re bound to face many financial barriers along the way.</p>



<p>Trying to navigate these financial barriers on your own can be stressful and needlessly complicated. It can also slow down the transition to a new country, making it difficult to start your life abroad or enjoy all your new home has to offer.</p>



<p>The good news is that you don’t have to do everything alone. With a little financial planning and the right resources, you’ll be able to navigate these challenges and live the life you want abroad.</p>



<p>If you’re thinking about moving to the U.S., here are some of the biggest financial barriers you’re likely to face and how to overcome them.</p>



<h2 class="wp-block-heading">Building Credit From Scratch</h2>



<p>Having credit is vital if you ever plan to apply for credit cards or use a loan — such as to buy a house or car. You might also&nbsp;<a href="https://www.consumerfinance.gov/ask-cfpb/what-is-a-credit-score-en-315/">need credit</a>&nbsp;to get an apartment with a lower deposit. Some utility and insurance companies also check your credit when you apply.</p>



<p>But even if you’ve already established credit in your home country, chances are it won’t matter much once you move to the U.S. That’s because your credit score generally won’t be applicable in the new country. You’ll have to start all over again.</p>



<p>Building credit might seem one of many financial barriers, but it’s possible. Here are some ways to get started:</p>



<ul class="wp-block-list">
<li>Apply for a&nbsp;<a href="https://files.consumerfinance.gov/f/documents/201612_cfpb_credit_invisible_checklist.PDF"><strong>secured credit card</strong></a><strong>.</strong>&nbsp;This is a type of reverse credit card that’s designed to help you build credit. Unlike with regular credit cards, you deposit a set amount of money into an account. That amount then acts as your credit line. You can use the card and make payments on it like you would a normal credit card. As long as you don’t miss any payments, you&#8217;ll start building credit over time.</li>



<li>Apply for a credit-builder loan.&nbsp;With this type of loan, the lender sets aside a set amount of money into a secured account that you must then pay for in monthly installments. Once you pay off the full amount or the loan term ends, you receive the full balance — sometimes with interest. As you go, the lender will report your payments to the credit bureaus so you can build credit.</li>



<li>Use a store credit card.&nbsp;Store credit cards are usually easy to get, though you might need a Social Security number (SSN). As with any credit card, making on-time payments or keeping your balance at zero can help you build credit.</li>



<li>Get an SSN or an Individual Taxpayer Identification Number (ITIN).&nbsp;While most credit card and loan companies don’t require an SSN or ITIN, having one could be useful if you’re trying to establish credit. You may be able to apply for an SSN as a noncitizen if you work for the&nbsp;<a href="https://www.ssa.gov/pubs/EN-05-10096.pdf">Department of Homeland Security (DHS)</a>. Alternatively, you can apply for an ITIN through the&nbsp;<a href="https://www.irs.gov/individuals/how-do-i-apply-for-an-itin">IRS</a>.</li>



<li>Ask to become an authorized user.&nbsp;If you have a friend or family member in the U.S., see if they’d be willing to add you to their credit card account as an authorized user. You’ll have access to that account, but you don’t have to use it. As long as the account is in good standing — no late or missed payments — you can build credit.</li>



<li>Take a financial literacy course.&nbsp;There are financial literacy programs for immigrants that can teach you more about credit and other aspects of personal finance. Many of these courses are free.</li>
</ul>



<h2 class="wp-block-heading">Financial Language Barriers</h2>



<p>According to the&nbsp;<a href="https://data.census.gov/table/ACSST1Y2019.S1602?q=language%20spoken%20at%20home">U.S. Census</a>, around 26 million households&nbsp;in the country have limited English proficiency. This isn’t just a problem for daily living; it can also prove challenging when it comes to understanding finances and getting access to the services you need abroad.</p>



<p>In particular, language barriers can make it harder to:</p>



<ul class="wp-block-list">
<li>Find the right bank.</li>



<li>Choose the best credit card or loan option for you.</li>



<li>Understand loan terms, rates, and costs.</li>



<li>Negotiate with lenders, utility companies, insurance companies, and even rental companies for the best rates, premiums, or terms.</li>



<li>Determine whether you’re dealing with a real company or a scam</li>
</ul>



<p>If English isn’t your first language and you’re going it alone, overcoming this particular challenge can be tricky, but you have a few options:</p>



<ul class="wp-block-list">
<li>Take a free financial literacy course to get a basis of what to expect as you go. Some courses are online.</li>



<li>Connect with local or online immigrant organizations to help you get established.</li>



<li>Take advantage of the interpretation services many financial companies offer to help you with things like opening a bank account or getting a credit card.</li>



<li>Choose a financial company or service that specializes in helping immigrants like you navigate some of these trickier financial aspects of life abroad.</li>
</ul>



<h2 class="wp-block-heading">Vulnerability to Financial Predators</h2>



<p>Another one of financial barriers many immigrants face is the existence of <a href="https://www.consumerfinance.gov/about-us/blog/identifying-and-addressing-the-financial-needs-of-immigrants/">financial predators</a> — that is, scammers and companies that try to get more money out of you.</p>



<p>Many of these financial predators charge extremely high fees on things like loans or credit cards but don&#8217;t disclose this information to you until it’s too late to back out. Some will use creative language or try to pressure you into signing up for something that ends up costing you money later.</p>



<p>Anyone can end up in such a situation, but it’s more prevalent among immigrants for a few reasons. For one, many immigrants have trouble accessing mainstream financial services, so promises of “convenience” or “quick access” can be all too appealing. For another, newcomers to the U.S. aren’t always as familiar with the language, cultural norms, or laws.</p>



<p>Here are just a couple examples of predatory financial practices:</p>



<ul class="wp-block-list">
<li>Expensive auto loans with unfavorable terms geared toward low- or moderate-income immigrant families</li>



<li><a href="https://www.consumerfinance.gov/ask-cfpb/what-is-a-payday-loan-en-1567/">Payday loans</a> that are easy to qualify for but come with short repayment terms and exorbitant fees — the average APR is around 400%. These rarely help you build credit and can quickly turn into a vicious cycle of debt.</li>



<li>“No credit check required” loan products or credit cards</li>
</ul>



<p>Before signing up for anything or sharing your personal information with a company, verify that they’re legitimate. You can do this through sites like the <a href="http://bbb.org">Better Business Bureau</a>&nbsp;(BBB) or Trustpilot. Also, be wary of anything that seems too good to be true.</p>



<p>Know that you have rights, too. Under the&nbsp;<a href="https://www.consumerfinance.gov/ask-cfpb/what-is-a-truth-in-lending-disclosure-for-an-auto-loan-en-787/">Truth in Lending Act</a>, companies must disclose the terms, rates, and conditions of any loans or credit cards to you. They’re also&nbsp;<a href="https://www.consumerfinance.gov/about-us/blog/protecting-immigrant-access-to-fair-credit-opportunities/">not allowed to discriminate</a>&nbsp;against you just because you’re an immigrant.</p>



<h2 class="wp-block-heading">Getting Access to Health Care</h2>



<p>When you first arrive in the U.S., one of the most important things is figuring out your health care. After all, you’ll want to find a good health care provider and insurance plan just in case something happens to you or a family member.</p>



<p>But gaining access to health care is a major challenge for many newcomers. Finding a high-quality provider is even harder in some cases.</p>



<p>The&nbsp;<a href="https://www.kff.org/report-section/understanding-the-u-s-immigrant-experience-the-2023-kff-la-times-survey-of-immigrants-findings/">Kaiser Family Foundation</a>&nbsp;(KFF) recently reported that around 25% of immigrants are treated differently or unfairly by their health care provider. This is often due to their accent or language barriers, but it’s also commonly because of their financial status or lack of insurance.</p>



<p>In terms of health insurance, there is good news. You can typically qualify for a plan via&nbsp;<a href="https://www.healthcare.gov/immigrants/lawfully-present-immigrants/">HealthCare.gov</a>&nbsp;if you meet certain criteria — such as being a “qualified non-citizen” or having a valid non-immigrant visa. You could even qualify for lower premiums or other savings.</p>



<p>If you don’t qualify for a Healthcare Marketplace plan, look into private health insurance options. Some companies specialize in working with immigrants so you can get the coverage you need and resolve additional financial barriers.</p>



<h2 class="wp-block-heading">Paying for Basic Necessities</h2>



<p>The cost of living in the U.S. is high. Depending on where you’re moving from and your financial situation, this can be a pretty major shock.</p>



<p>If you’re moving to the country for a job — or if you work remotely and can bring your job with you — that can certainly help. But if not, you might have difficulty handling daily living expenses.</p>



<p>Fortunately, there are federal safety net programs available to people who need them. This includes:</p>



<ul class="wp-block-list">
<li>Affordable health care like Medicaid and the Children’s Health Insurance Program (CHIP)</li>



<li>The Low-Income Home Energy Assistance Program (LIHEAP) to assist with utility payments</li>



<li>Temporary Assistance for Needy Families (TANF) to help with things like childcare and other short-term financial needs</li>



<li>Supplemental Nutrition Assistance Program (SNAP) to supplement food costs</li>



<li>Emergency rental assistance programs or Section 8 vouchers</li>
</ul>



<p>You can check your eligibility for these types of programs — and more — through sites like <a href="https://www.hud.gov/program_offices/public_indian_housing/pha/contacts">Hud.gov</a>&nbsp;and&nbsp;<a href="https://www.benefits.gov/">Benefits.gov</a>. If you don’t qualify, check into local programs or charitable organizations in your area.</p>



<h2 class="wp-block-heading">Understanding Taxes</h2>



<p>Moving to the U.S. also means dealing with taxes. Depending on which city and state you move to, you could have to pay sales tax and local taxes. If you buy a home, you’ll also need to pay property taxes. And if you earn money, you’ll need to pay federal — and possibly state — taxes on your earnings.</p>



<p>Make sure you consider your tax obligations before moving abroad. You can learn more about how taxes work in the U.S. and how your residency status affects your taxation on the <a href="https://www.irs.gov/individuals/international-taxpayers/tax-information-and-responsibilities-for-new-immigrants-to-the-united-states">IRS website</a>.</p>



<h2 class="wp-block-heading">Preparing for Other Upfront Costs</h2>



<p>There’s a lot to think about when planning a move abroad, not least of which is your budget. Unless you plan to stay with someone you know until you get on your feet, you’re likely going to need to pay for quite a few things up front.</p>



<p>This isn’t just the initial moving costs — though those are important, too. Part of financial planning for immigrants includes considering other common expenses, such as:</p>



<ul class="wp-block-list">
<li>Short-term accommodations:&nbsp;Consider where you plan to stay in the short- and long-term. Will you be at a hotel for a few nights or weeks or are you going straight to your new apartment? Make sure you have enough money to cover any short-term stays.</li>



<li>Deposits:&nbsp;Most apartments in the U.S. require a security deposit. If you don’t have a credit score yet, you might need to pay a larger deposit — sometimes an entire month’s rent — up front.</li>



<li>Utilities:&nbsp;When you move, you’ll typically need to set up utilities like water, electricity, gas, trash, cable, phone, and internet. Some companies will require an initial deposit, while others will only charge you on a monthly basis.</li>



<li>Application fees:&nbsp;There are many fees involved with moving abroad — like applying for an apartment or getting a background or credit check. You may also have to pay for immigration applications or visa fees.</li>



<li>Insurance:&nbsp;Besides health insurance, other common types of insurance include auto insurance and renters insurance. Depending on your vehicle or apartment type, you may need to pay more for your policy.</li>
</ul>



<p>You might be able to get financial assistance as an immigrant, but having a financial buffer can also make it easier for you to start your life abroad.</p>



<h2 class="wp-block-heading">Setting Up Banking Services</h2>



<p>When you first move to the U.S., chances are you won’t have a bank account. While this might not seem like a big deal at first, it can quickly become problematic.</p>



<p>Having access to a bank account makes it easier to pay bills, get paid via direct deposit, and transfer money — abroad and domestically. A checking or savings account can also be a great way to store your money securely.</p>



<p>Unfortunately, around&nbsp;<a href="https://www.migrationpolicy.org/sites/default/files/publications/mpi_low-income-immigrants-factsheet_final.pdf">7% of all immigrants are unbanked</a>. This means that nobody in the household has a bank account of any kind. Lower-income immigrant households are even less likely to have a bank account.</p>



<p>The problem with not having a bank account is that you’re more likely to rely on more expensive options like cashier’s checks and money orders for financial transactions. These options can also be inconvenient if you need to send money quickly.</p>



<p>If you plan to live in the U.S. for the long haul, prioritize opening a bank account. You’ll need some things to do this — like a passport or ITIN and proof of address. You might also need documents related to your citizenship or residency status.</p>



<h2 class="wp-block-heading">Sending Money Abroad</h2>



<p>Many immigrants want to financially support their families back home. But figuring out how to do this is one of the biggest challenges immigrants in the U.S. face. After all, sending money overseas can be expensive or exceedingly slow without a bank account.</p>



<p>Fortunately, there’s been an increase in the&nbsp;<a href="https://www.riamoneytransfer.com/en/blog/remittances-growth-in-the-face-of-global-challenges/">popularity of global remittances</a>. International money transfer services like Ria now exist to make it easier for immigrants to send and receive money overseas, pay bills, and more — all without a bank account. The process is fast, secure, and easy.</p>



<p>Even if you have a bank account in the U.S., it doesn’t hurt to have a second reliable method to send or receive money. Creating an account doesn’t cost anything and is hassle-free. Check out Ria today or&nbsp;<a href="https://www.riamoneytransfer.com/en/blog/how-migrants-can-send-money-home-with-ria/">learn more about how it works</a>.</p>



<h2 class="wp-block-heading">Overcoming the Many Challenges Immigrants Face</h2>



<p>As you plan your move to the U.S., you don&#8217;t have to let financial barriers like building credit, opening a bank account, or dealing with language differences hold you back. <a href="https://www.riamoneytransfer.com/en/blog/international-migration-overcoming-adversity-2022/">Overcoming adversity</a> can be tough, but these barriers shouldn’t keep you from pursuing your dreams.</p>



<p>Remember, there’s a multitude of financial resources for immigrants, including financial literacy programs, local and federal immigrant financial assistance programs, and interpretive services. And if you want to cut out some of the stress of getting settled in a new country, set up a way to&nbsp;<a href="https://www.riamoneytransfer.com/en-us/">send or receive money internationally with Ria</a>. It’s quick and easy and, best of all, you can do it at any time — before or after you reach the U.S. </p>


Woman overwhelmed at financial documents.

9 Financial Barriers Many US Immigrants Face (And How to Overcome Them)

About the author

Gabriela Solis

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