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Are Asian American savers too focused on accumulation?

Financial professionals should understand how many Asian Americans approach retirement planning

It’s a study in contrasts: While Asian Americans are the wealthiest population group in the United States1, they tend to be the least content with their current financial circumstances and less hopeful about reaching their financial goals.2

“A lot of Asian Americans have no idea they actually have enough money for retirement. They are focused solely on accumulation and have the mindset that they will work until they die.”

This disparity can partially be explained by the fact that the Asian American community is among the most economically divided in the United States.3 But that’s not the only reason. According to Pei Yin Ng, a recent Chinese-Malaysian immigrant to the U.S. and a senior advanced markets analyst at Global Atlantic, many Asian Americans, especially first generation, can be overly focused on accumulation rather than their retirement lifestyle or how they will spend their money in retirement.

Currently, 75% of Asian American workers are foreign-born.4 Many are working or have worked long hours to provide for their children and may have built wealth through owning a small business or saving enough to invest in real estate. Ng says, “A lot of Asian Americans have no idea they actually have enough money for retirement. They are focused solely on accumulation and have the mindset that they will work until they die.”

As the fastest-growing population group in the U.S. – one that is expected to double over the next 40 years5 – there is a huge opportunity for financial planning advice to help fill in the gap between expectation and reality.

Longevity, legacy and filial piety


Several studies have found that Asian Americans live longer than other ethnic groups, meaning they must plan for more years in retirement.6 This statistic reaffirms the importance of planning for retirement lifestyle beyond just working indefinitely.


Meanwhile, some older Asian Americans may be focused solely on leaving a legacy (helping children and grandchildren with education, for example) and not thinking about their own retirement. They may need to be educated on how they can put their money to work for them to achieve their desired outcome. Financial professionals working with Asian Americans, whether older or younger, should recognize this desire to take care of the generations above and below.

Filial piety

Some older Asian Americans, particularly those who are first generation, assume their children will take care of them in old age, whether or not they have money saved for retirement. This is due in large part to the concept of filial piety, an important value in many Asian cultures that teaches young people to respect, obey, and care for their elders. As a result, many younger Asian Americans may feel like they must save three “pools” of money – for themselves, their children, and their parents. And that’s not counting the money they may be sending back to family in their country of origin, leaving less for their own future.

In keeping with the notion of filial piety, Ng says many children don’t know how to have a conversation with their parents about finances since it can be seen as a challenge to their elders’ authority and wisdom. A financial professional can help facilitate an open conversation between adult children and their parents about planning for the future.

Starting the conversation

For all of these reasons, financial planning needs of Asian Americans may be more complex and perhaps different than for other groups. This article on how annuities may be especially attractive for some in the Asian American community may be a great place to start and outlines how annuities can provide the protection, legacy, and accumulation many Asian Americans may be seeking.

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