The United States sometimes considers Asian people and Indian people as one population. Asians—people from China, Japan, Vietnam, Korea, Cambodia, and Thailand—are quite different from each other, as are people from India and Pakistan. Culture, religion, history, and economics—among many factors—contribute to differences. Acculturation, moreover—whether a person is a recent immigrant or a second- or third-generation resident—is a key differentiator. In 2013, The Pew Research Center updated its 2010 Asian Americans study The Rise of Asian Americans), which provides useful background and general information. This Segment Summary, however, treats the two groups as a single population. Including the Asian-Indian oversample, the 2014–15 MacroMonitor represents roughly 7.3 million Asian households (4.6 million non-Indian-Asians and 2.7 million Asian-Indians)—that provides a reliable sample to help explain these economic households fully.

Demographics

In comparison with non-Asian households, Asian household heads:

• Are younger: Their mean age is 44 versus 52; 41% are Millennials, compared to 25% of non-Asian households
• Are twice as likely to have a four-year college degree or higher (61% versus 31%)
• Are more likely to be employed (81% versus 63%)
• Are more likely to support dependent children (44% versus 32%)
• Are more likely to be renters (42% versus 33%) and to live in a major city (24% versus 15%) or a suburb of a large city (34% versus 26%)
• Have a mean HHI of $92K versus $71K.

Financials

Asian households are particularly attractive to financial-services providers because they have higher total assets ($561K, in comparison with $469K for non-Asian households) and a higher mean net worth ($443K versus $384K).

• Asian households also have somewhat higher total liabilities than non-Asian households ($118K versus $85K).
• Asian households are more likely than non-Asian households to own education savings accounts, 529 savings plans, stock or bond mutual funds, publicly traded stocks, and nontraded stocks and to have above-average mean amounts in retirement savings; savings accounts; education savings accounts; 529 plans; 401(k), 403(b), or 457 plans; and Keogh accounts.
• Among Asian households that own a single-family home, condo, co-op, townhouse, or row home, mean amounts owed on first mortgages ($224K) and junior mortgages ($104K) are much higher than mean amounts owed by non-Asian households ($142K and $54K, respectively).
• Asian households are more likely than non-Asian households to use full-service stockbrokerages, discount stockbrokerages, and mutual fund companies.
• Asian households are less likely than non-Asian households to agree that financial institutions have their best interests in mind when offering products and services or that, upon death, a life-insurance agent will act in the best interests of their beneficiaries.
• They are less concerned than are non-Asian households about doing business with a financial institution that has been implicated in a scandal.

Financial Attitudes and Interesting Tidbits

The majority of Asian households are interested in financial matters. They plan ahead for needs such as education funding, retirement, and medical expenses. As a result of judicious planning, saving, and investing, Asian households are much less likely than non-Asian households to agree they will rely on Social Security for retirement income or on Medicare for the majority of their health-care needs.

• Possibly because many do not plan to depend on Social Security and Medicare in the future, Asian households want to minimize taxes today.
• Asian households have more disposable income remaining at the end of a typical month than do non-Asian households ($1,300 versus $900); 47% versus 59% have $500 or less in disposable income per month.
• In addition to having savings and investing goals for education, Asian households have higher goals than do non-Asian households for buying a vehicle, taking a vacation, and providing for heirs.
• Asian households are less likely than non-Asian households to agree they would never get an adjustable-rate mortgage or auto loan or would continue to make monthly mortgage-loan payments if they owe more on their house than it is worth.
• Many Asian households use credit liberally. They are less likely than non-Asian households to agree that they are careful not to use more credit than they should, that to buy anything other than a house or car on credit is unwise, or that they would never borrow against the equity in their home.
• Comfortable doing financial business on the internet, Asian households are more likely than non-Asian households to use an app to access their financial institution.
• Asian households are more likely than non-Asian households to want to learn more about how to research and choose investments, how to minimize income taxes, and how to extract income from retirement assets.

Implications

Highly educated and employed, the majority of Asian households represent a number of opportunities for financial-services providers (see Indus American Bank). Many have yet to reach peak-earning years or life stages when financial needs will increase. Credit needs are high, but many Asian households are already saving and investing for retirement. The fact that Asian communities are tightly connected means that gaining their trust will be challenging. However, targeting these households while they are relatively young will generate future rewards.

Learn more: MacroMonitor subscribers and nonsubscribers may contact us to learn more about the Asian-Indian oversample. Subscribers may request an on-site presentation of these findings along with a Q&A session for a small additional fee.