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Asian Americans and Financial Services - US - December 2010

SCOPE AND THEMES
What you need to know
Definition
Sources
Consumer survey data
Consumer Expenditure Survey
Advertising
Abbreviations and terms
Abbreviations
Terms
Generations
EXECUTIVE SUMMARY
Despite recession, Asian buying power remains very strong
Asian respondents, still working; optimistic about their financial well-being
More than three quarters of Asians surveyed trust financial institutions
Asian Americans consider themselves independent when forming financial goals
Asians more likely to own mortgage loans, credit cards
Affluent Asian households utilizing long-term savings vehicles
Asian respondents rely on family and friends for financial advice
Nearly three quarters of Asians bank online
Social networking trend is real
Asians using investment product to achieve financial goals
Credit has hit new lows as banks, consumers cut back
Most Asians are not overwhelmed by debt
Asians most likely to own health or life insurance
Asian respondents most likely to purchase health insurance independently
Asian Americans, like other respondents, prefer term life policies
Asians most likely to own 401(k) accounts and brokerage accounts
U.S. Asian population fast growing, well-educated, diverse
INSIGHTS AND OPPORTUNITIES
Embrace social media, target Asian consumers online
Asian retirees a candidate for 401(k) rollovers
INSPIRE INSIGHTS
Trend: “Rebuilding Trust”
ASIAN AMERICAN HOUSEHOLD INCOME AND BUYING POWER
Key points
More than one third of Asian American households earn more than $100K
Figure 1: Household income distribution, by race and Hispanic origin, 2009
Income
Figure 2: Household income distribution for all households and Asian households, 2009
Asian affluence, by nationality/ancestral group
Figure 3: Median household income, by top 10 Asian nationality/ancestral groups, 2000
Purchasing power
Figure 4: Purchasing power, by race/Hispanic origin, 2010
Asian cities and metropolitan areas
Figure 5: Top 10 metropolitan areas with the largest number of Asian residents, 2005-07
Figure 6: Percentage of Asian nationality/ancestral group, by city, 2000
ECONOMIC OUTLOOK
Key points
Asian respondents optimistic about their financial well-being
Figure 7: Economic outlook compared to 12 months ago, by race/Hispanic origin, April 2009-June 2010
Impact of the recession on Asian Americans
A small but concentrated number of less affluent Asians struggling economically
Figure 8: Economic outlook compared to 12 months ago, by household income, September 2010
Older Asians feel worse off, concerned about retirement
Figure 9: Economic outlook compared to 12 months ago, by age, September 2010
THE CONSUMER AND FINANCIAL INSTITUTIONS
Key points
Trust in financial institutions
More than three quarters of Asians surveyed are trusting of financial institutions
Figure 10: Trust in financial institutions, by household income, September 2010
Types of accounts held at financial institutions
More affluent Asians using wide variety of financial products
Figure 11: Types of accounts held at financial institutions, by household income, September 2010
English-speaking Asians show widespread use of financial products
Figure 12: Types of accounts held at financial institutions, by language spoken in the home, September 2010
ATTITUDES TOWARD FINANCES AND FINANCIAL GOALS
Key points
More affluent Asians should be targeted by banks
Saving for an education or a home is a priority
Figure 13: Attitudes toward saving money, by household income, September 2010
Asian Americans likely to help community members in need
Figure 14: Attitudes toward friends and family help with finances, by household income, September 2010
Debt an ongoing challenge for less affluent Asians
Figure 15: Attitudes toward debt, by household income, September 2010
Affluent Asians use financial products to meet variety of goals
Figure 16: Other attitudes toward finances, by household income, September 2010
Less acculturated Asians more likely to be saving for education
Figure 17: Attitudes toward saving money, by level of association with Asian culture, September 2010
Less acculturated are more likely to receive money from family/friends
Figure 18: Attitudes toward friends and family help with finances, by level of association with Asian culture, September 2010
Acculturation has little impact on debt
Figure 19: Attitudes toward debt, by level of association with Asian culture, September 2010
Asians who prize culture steer financial goals toward family
Figure 20: Other attitudes toward finances, by level of association with Asian culture, September 2010
Financial goals
Home buying a priority for young Asians, retirement a goal for elders
Figure 21: Financial goals, by age and gender, September 2010
Asians who prize Asian culture likely to have goal of starting business
Figure 22: Financial goals, by level of association with Asian culture, September 2010
ACQUIRED LOANS AND DEBTS
Key points
Asian respondents most likely to own home mortgage loan
Figure 23: Loan ownership, by race/Hispanic origin, April 2009-June 2010
Types of debts owned
More affluent Asians surveyed using home mortgages, credit cards
Figure 24: Types of debts owned by Asian American households, by household income, September 2010
U.S.-born Asians using variety of financial products
Figure 25: Types of debts owned by Asian American households, by place of birth, September 2010
TYPE OF FINANCIAL PRODUCTS OWNED BY ASIAN AMERICANS
Key points
Affluent Asian households utilizing long-term savings vehicles
Figure 26: Types of financial products owned by Asian American households, by household income, September 2010
Young Asians, using credit-monitoring services, anticipate future loan use
Figure 27: Types of financial products owned by Asian American households, by age and gender, September 2010
FINANCIAL ADVICE
Key points
Resources used
Asians rely on family and friends for financial advice
Figure 28: Resources used for financial advice, by household income, September 2010
Asians with association to Asian culture use friends and family as resource
Figure 29: Resources used for financial advice, by level of association with Asian culture, September 2010
Young Asians use family and the internet as their financial resource
Figure 30: Resources used for financial advice, by age, September 2010
FINANCIAL SERVICES AND TECHNOLOGY
Key points
Nearly three quarters of Asians bank online
Figure 31: Methods used for paying bills, by race/Hispanic origin, April 2009-June 2010
Online influencers on financial services
Social media has impact on young Asians
Figure 32: Influence and use of social media regarding financial services, by age, September 2010
Figure 33: Impact of selected influencers on choice of financial services, by age, September 2010
Affluent Asians consider social media, though pressed for time
Figure 34: Influence and use of social media regarding financial services, by household income, September 2010
Figure 35: Impact of selected influencers on choice of financial services, by household income, September 2010
Mobile technology and financial services
Male Asians excited for mobile technology, females concerned about safety
Figure 36: Interest in use of cell phone for various financial services applications, by age and gender, September 2010
Mobile technology use increases with household income
Figure 37: Interest in use of cell phone for various financial services applications, by household income, September 2010
BANKING AND INVESTMENT SERVICES OWNED
Key points
Banking products owned
Asians most likely group to own savings accounts
Figure 38: Banking/investment services owned, by race/Hispanic origin, April 2009-June 2010
Asian female financial responsibilities evolve with age
Figure 39: Banking/investment services owned by Asian Americans, by age and gender, April 2009-June 2010
Affluent Asians favor savings accounts over CDs
Figure 40: Banking/investment services owned by Asian Americans, by household income, April 2009-June 2010
Investment products owned
More than half of Asian respondents own investment products
Figure 41: Investment products owned, by race/Hispanic origin, April 2009-June 2010
Affluent Asians supplement savings with other investment vehicles
Figure 42: Investment ownership by Asian American adults, by gender and household income, April 2009-June 2010
CARD OWNERSHIP AND USAGE
Key points
Debit and credit card ownership
Asians surveyed likely to own both debit and credit cards
Figure 43: Credit card and ATM/debit card ownership, by race/Hispanic origin, April 2009-June 2010
Credit card ownership increases with age…
Figure 44: Credit card and ATM/debit card ownership, by age and gender, April 2009-June 2010
…and also with household income
Figure 45: Credit card and ATM/debit card ownership, by household income, April 2009-June 2010
Credit hits new lows as banks, consumers cut back
Figure 46: Consumer credit outstanding, percentage change, 2005-09
Large portion of Asian respondents not overwhelmed by debt
Figure 47: Level of household credit card debt, by household income, September 2010
Debt has greatest effect on the middle-aged
Figure 48: Level of household credit card debt, by age, September 2010
INSURANCE PRODUCTS OVERVIEW
Key points
Ownership of insurance products
Asians most likely to own health or life insurance
Figure 49: Ownership of health/hospital/life insurance, by race/Hispanic origin, April 2009-June 2010
Surprisingly, only half of Asian respondents own life insurance
Figure 50: Type of insurance owned, ry race/Hispanic origin, April 2009-June 2010
Insurance products owned by Asian Americans
Young female Asians present opportunity for insurers
Figure 51: Insurance products owned by Asian households, by age and gender, September 2010
Asians who prize Asian culture three times as likely to own life insurance
Figure 52: Insurance products owned by Asian households, by level of association with Asian culture, September 2010
HEALTH INSURANCE
Key points
Asian respondents most likely to purchase health insurance independently
Figure 53: Means of obtaining health insurance, by race/Hispanic origin, April 2009-June 2010
Less affluent purchase health insurance independently, more affluent insured by employer
Figure 54: Ownership of health insurance (employer provided and private), by household income, April 2009-June 2010
Health insurance source varies by age, gender
Figure 55: Ownership of health insurance (employer provided and private), by age and gender, April 2009-June 2010
Asians purchasing health insurance independently not using brokers
Figure 56: How individual health insurance was purchased, by gender, April 2009-June 2010
OTHER INSURANCE
Key points
Life insurance
Asian respondents, like other race groups, prefer term life policies
Figure 57: Ownership of life insurance, by race/Hispanic origin, April 2009-June 2010
Males over-index in term policies, females over-index in whole/universal policies
Figure 58: Ownership of life insurance by Asian American households, by gender, April 2009-June 2010
Property and/or auto insurance
Three quarters of Asians surveyed own property and/or auto insurance.
Figure 59: Ownership of property/auto insurance, by race/Hispanic origin, April 2009-June 2010
Property and/or auto insurance ownership increases with household income
Figure 60: Ownership of auto insurance by household income, April 2009-June 2010
RETIREMENT PLANNING
Key points
Attitude toward retirement planning
Figure 61: Attitudes toward individual’s responsibility for retirement planning, by race/Hispanic origin, April 2009-June 2010
Middle-income Asian respondents believe retirement is an individual’s responsibility
Figure 62: Attitudes toward individual’s responsibility for retirement planning, by household income, April 2009-June 2010
Middle-aged Asian Americans also stress individual responsibility for retirement
Figure 63: Asian American Attitudes toward an individual’s responsibility for retirement planning, by age, April 2009-June 2010
Retirement savings
Nearly one third of Asians surveyed own 401(k) account
Figure 64: Ownership and value of 401(k) accounts, by race/Hispanic origin, April 2009-June 2010
Ownership of 401(k) accounts increases with household income
Figure 65: Ownership and value of 401(k) accounts by Asian adults, by household income, April 2009-June 2010
Ownership of a mutual fund/brokerage account by race/Hispanic origin
One quarter of Asians own brokerage accounts; over-index in nonretirement accounts
Figure 66: Ownership of a mutual fund/brokerage account, and retirement vs. nonretirement, by race/Hispanic origin, April 2009-June 2010
Asian males more likely to own mutual fund/brokerage account
Figure 67: Ownership of a mutual fund/brokerage account, and retirement vs. nonretirement, by gender, April 2009-June 2010
CLUSTER ANALYSIS
Financially Fatigued
Demographics
Characteristics
Opportunities
Debt-averse
Demographics
Characteristics
Opportunities
Manageable, Multi-accounts
Demographics
Characteristics
Opportunities
Cluster characteristic tables
Figure 68: Asian American clusters, September 2010
Figure 69: Type of accounts owned, by Asian American clusters, September 2010
Figure 70: Attitudes toward saving money, by Asian American clusters, September 2010
Figure 71: Attitudes toward friends and family help with finances, by Asian American clusters, September 2010
Figure 72: Attitudes toward debt, by Asian American clusters, September 2010
Figure 73: Other attitudes toward finances, by Asian American clusters, September 2010
Figure 74: Attitudes toward financial institutions by Asian American clusters, September 2010
Figure 75: Economic outlook compared to 12 months ago, by Asian American clusters, September 2010
Figure 76: Level of household hold credit card debt by Asian American clusters, September 2010
Figure 77: Level of association with Asian culture by Asian American clusters, September 2010
Cluster demographic tables
Figure 78: Asian American clusters, by gender, September 2010
Figure 79: Asian American clusters, by age, September 2010
Figure 80: Asian American clusters, by household income, September 2010
Figure 81: Asian American clusters, by country of birth, September 2010
Cluster methodology
MARKETING STRATEGIES
Key points
 TELEVISION COMMERCIALS
Bank of American highlights Asian employee giving back to community
Figure 82: Bank of America, TV ad, September, 2010
Bank of America demonstrates online home loan guide
Figure 83: Bank of America, TV ad, June, 2010
Wells Fargo opens with Asian employee in pitch for bank’s services
Figure 84: Wells Fargo, TV ad, April, 2010
 ONLINE INITIATIVES
U.S. ASIAN AMERICAN POPULATION
Key points
 ASIAN DEMOGRAPHICS
U.S. population diversity
Figure 85: Population, by race/Hispanic origin, 1970-2020
Figure 86: Asian, Black, and Hispanic populations, 1970-2020
Figure 87: Population by race and Hispanic origin, 2005-15
U.S. Asian population
Asian population by age
Figure 88: U.S. Asian population by age, 2005-15
Figure 89: Total U.S. population, by age, 2005-15
Figure 90: Generations, by race/Hispanic origin, 2009
Identifying Asian Americans
U.S. Asian geographic concentration
Figure 91: Asian geographic concentration, by region, 2008
Figure 92: Top 10 states, by total Asian population and percentage of state total population, 2008
 ASIAN PURCHASING POWER
Figure 93: Median household income, by race and Hispanic origin, 2009
Asian buying power by state
Figure 94: Top 10 states, by Asian buying power, 2009
Generational insights among Asian consumers
 THE ASIAN HOUSEHOLD
Average household size
Figure 95: Average household size, by Hispanic origin/race of householder, 2001 and 2008
Average Asian household size by nationality/ancestral group
Figure 96: Average Asian family and household size, by nationality/ancestral group, 2000
Marital status of Asians
Figure 97: Marital status of Asians, by age, 2008
Figure 98: U.S. population marital status, by age, 2008
Top ethnicities
Figure 99: U.S. Asian population, by nationality/ancestral group, 2008
Asian cities and metropolitan areas
Figure 100: Top 10 metropolitan areas with the largest number of Asian residents, 2005-07
Figure 101: Percentage of Asian nationality/ancestral group, by city, 2000
 ASIAN AMERICANS AND EDUCATION
Asians’ educational attainment
Figure 102: Educational attainment of Asians, 2004
Asians’ educational attainment by nationality
Figure 103: Educational attainment of Asians, by detailed nationality/ancestral group, 2000
APPENDIX: ADDITIONAL TABLES
Trust in Financial Institutions by Association with Asian culture
Figure 104: Trust in financial institutions, by association with Asian culture, September 2010
Figure 105: Influence and use of social media regarding financial services, by language spoken in the home, September 2010
Figure 106: Impact of selected influencers on choice of financial services, by language spoken in the home, September 2010
Figure 107: Influence and use of social media regarding financial services, by level of association with Asian culture, September 2010
Figure 108: Impact of selected influencers on choice of financial services, by level of association with Asian culture, September 2010
APPENDIX: TRADE ASSOCIATIONS

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