💳 How to Manage Money in the U.S.: Budgeting, Banking, and Credit Basics for Immigrant Youth

Managing money well is a very useful skill. Knowing how to handle your finances helps you stay independent, avoid unnecessary stress, and unlock opportunities for your future. And learning how to manage your money now will help you create good financial habits that set you up for long-term success! 

This guide is about real financial topics that affect your day-to-day life and long-term stability. Continue reading for information about: 

• ✏️ What is a budget and how do I create one? 
• 🏦 What do I need to know about opening a bank account? 
• 💳 What is the difference between a debit and credit card?  
• 📈 What is credit and why is it important? 
• 🥷🏽 How do I stay safe from financial fraud and scams? 
   

1. ✏️ What is a budget and how do I create one? 

What is a budget? 

A budget is a plan for how you’ll use your money over a period of time. It helps you make sure your income (the amount of money that you make/receive) covers your needs, and it gives you control over where your money goes. It also helps you avoid the stress of having to scramble to pay bills that you didn’t expect or don’t have the money for. 

How do I create a budget? 

To build a budget, start by figuring out how much money you expect to bring in, then list out your regular expenses. A budget usually covers a set period of time, like a month. The goal is to make sure your spending isn't higher than your income, and that you’re setting aside something—no matter how small—for savings or emergencies. 

Here’s how to build a basic budget: 

1. Add up your monthly income. Include paychecks, side gigs, support from family, or any other money you regularly receive 
2. List your fixed expenses. These are costs that stay the same each month, like rent, phone bills, or subscriptions. 
3. Estimate your variable expenses. These are costs that change from month to month, like groceries, transportation, or personal spending. 
4. Set a savings goal. Even $10 to $20 a month adds up over time! 
5. Adjust as needed. If your expenses are higher than your income, look for areas to cut back or ways to increase earnings. 

You can create a budget with a simple chart on a piece of paper. Or there are many free and simple apps that can help keep track of your finances. 

Budgeting is more challenging if your income is unpredictable or inconsistent. Here are some tips for budgeting if you’re income changes week to week or month to month: 

• Base your budget on your lowest expected monthly income, not your average. That way, you’re covered even in slow months. 
• Prioritize fixed costs first (like rent and phone bills), then flexible ones (like food and personal spending). 
• Create a buffer fund: Set aside a small amount each time you get paid—$20, $50, whatever you can. This helps cover gaps when income drops. 
• Use a weekly budget if monthly feels too unpredictable. Break your spending into smaller chunks so you can adjust more easily. 
• Track your actual income and expenses for a few months to spot patterns. You might notice that you earn more in certain weeks or seasons, and you can use that info to plan ahead. 
   

2. 🏦 What do I need to know about getting a bank account? 

Why should I open a bank account? 

A bank account gives you access to the financial system. It’s not just about storing money, it’s also about: 

• 💵 Getting paid: Most jobs use direct deposit. 
• 💡 Paying bills: Rent, phone, utilities, etc. Often require electronic payment. 
• ⚠️ Avoiding fees: Check-cashing services and payday lenders charge high fees. 
• 🛡️ Keeping money safe: Bank accounts are insured up to $250,000. 
• 💳 Building financial history: Having a bank account is often the first step toward building credit. 

What kinds of banks exist in the U.S.? 

There are three main types of banks in the U.S. There are national banks, local banks, and credit unions. Here are some things to keep in mind about each type of bank when you choose where to open an account: 

Type of Bank	National Banks:  These are large, well-known banks with branches across the country (e.g., Chase, Bank of America, Wells Fargo).	Local/Regional Banks:  Smaller banks that operate in specific cities or states.	Credit Unions:  Non-profit financial institutions owned by their members (e.g., Self-Help Federal Credit Union, Alliant Credit Union).
✅ Pros:	Wide availability of branches and ATMs Strong mobile apps and online banking tools  Offer full services: checking, savings, credit cards, loans  Often accept ITINs and foreign IDs for account opening	More personalized customer service  May be more flexible with documentation  Often support local communities and small businesses	Lower fees and better interest rates  More likely to work with immigrants and underserved communities  Often accept alternative forms of ID and ITINs  Strong community focus
❌ Cons:	Higher fees and minimum balance requirements  Less personalized service  May be harder to navigate for non-English speakers	Fewer branches and ATMs  Mobile apps may be less advanced  May not offer as many financial products	Membership may be limited to certain groups or regions  Fewer branches and ATMs  May have fewer credit card or loan options

How do I choose the bank that’s right for me? 

When deciding where to open an account, consider: 

• 🗣️ Language support: Does the bank offer services in your preferred language? 
• 🫰🏽 Fees: Are there monthly fees or minimum balance requirements? 
• 📍 Accessibility: Are there branches or ATMs near you? 
• 🪪 Documentation: Will they accept your ID and immigration status? 

What type of account should I open? 

Once you decide which bank to work with, you’ll need to decide on what type of account to open. The two main types of accounts that most people start with are checking accounts and saving accounts. There are pros and cons to each type of account: 

Type of Account	Checking account:  a good option for everyday spending	Savings account:   a good option for storing money more long-term
✅ Pros:	Easy access and features like bill pay and a linked debit card	Your money will earn interest, which helps you build savings
❌ Cons:	May have fees or minimum balance rules   (note: minimum balance rules mean that you must keep a minimum amount of money in your account at all times to avoid being charged a fee)	Limited withdrawals, may not have features like a debit card

📌 Tip: Many people start with a checking account and add a savings account when they’re ready to build an emergency fund or save for goals. 
 

3. 💳 Debit Cards vs. Credit Cards: What’s the difference? 

When you open a bank account, you’ll likely get a debit card. As you build financial history, you may also consider getting a credit card. Both are useful, but they work very differently. 

Type of Card	A debit card: pulls money directly from your checking account. You can use it to pay for things, withdraw cash, or pay bills.	A credit card: lets you borrow money from a bank or lender to make purchases. You pay it back later—ideally in full each month.
✅ Pros:	Easy to use and widely accepted  No interest charges  Helps you avoid spending money you don’t have	Builds your credit score when used responsibly  Offers fraud protection and purchase insurance  Can be used for emergencies or large purchases
❌ Cons:	Doesn’t build credit history  If your account is low, transactions may be declined or trigger overdraft fees  Less protection against fraud compared to credit cards	Interest charges if you don’t pay the full balance  Easy to overspend if you’re not careful  Late payments hurt your credit score

📌 Key Difference: Debit cards use your own money. Credit cards use borrowed money that you have to repay. 

In the next section, we’ll break down how credit works, why it matters, and how to start building it.
 

4. 📈 What is credit and why is it important? 

What is credit?

Credit is your financial reputation. It shows how trustworthy you are when it comes to borrowing money and paying it back. In the U.S., credit is tracked through a credit score, which is based on your payment history, debt levels, and how long you've had credit. 

Why is credit important? 

Even if you’re not planning to borrow money right now, your credit score can affect your ability to: 

• 🏠 Rent an apartment – landlords often check credit 
• 📱 Get a phone plan or other utilities – some companies require a credit check 
• 🚘 Buy a car or get a loan – better credit means lower interest rates 
• 🧑🏽‍🏭 Future job applications – some employers check credit for certain roles 

What habits help build good credit? 

• 🕔 Paying bills on time 
• 💳 Using a credit card responsibly 
• ⚠️ Keeping balances due low 
• ❌ Avoiding too many new accounts 

If you’ve never had a credit card, loan, or bill in your name, you probably don’t have a credit history yet. That’s normal, and there are ways to start building credit from scratch, even if you’re not a U.S. citizen or don’t have a Social Security Number. Building credit early—and managing it well—can open up more options and save you money in the long run. 
 

5. 🥷🏽 How do I stay safe from financial fraud and scams? 

Scams are everywhere! Staying alert and knowing what to watch for can protect your money and your personal information. 

Common scams to watch out for: 

• Fake job offers that ask for money upfront or personal info 
• “Fast cash” loans with extremely high interest rates 
• Phishing emails or texts pretending to be from banks or government agencies 
• Check fraud or scams involving mobile payment apps 

Tips to Stay Safe: 

• ❌ Don’t share your Social Security Number, ITIN, or bank info unless you’re sure who you’re dealing with. 
• ❌ Avoid giving out personal info over text, email, or social media. 
• ✅ Use official websites ending in .gov or .org for financial or immigration services. 

For information about fraud related to immigration, check out our article How to Avoid Immigration Fraud and Scams. 
 

6. ℹ️ Helpful resources: 

If you want to keep building your financial knowledge, here are a few reliable resources designed for youth and newcomers to the U.S.: 

• Hands on Banking for Youth --> Free online courses that teach financial basics for different age groups. Available in English and Spanish, the courses cover topics like how banks work, how to build credit, how to create a savings plan, and how student loans function. 
• CILA Academy Guide: Be Smart with Your Money --> A youth-friendly infographic available in English and Spanish. It explains how to create a budget, what credit is, and how to avoid financial scams 
• Switchboard Financial Resources --> A collection of articles, infographics, and educational tools focused on financial empowerment for refugees and immigrant youth. Many resources are available in multiple languages, including Spanish. 
• Wise → A safe and affordable option for sending money internationally. Wise (formerly TransferWise) allows you to transfer funds to bank accounts in other countries with low fees and transparent exchange rates. It’s a great tool for immigrants who need to support family abroad or manage finances across borders. 

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Key Takeaways: What You Should Know About Managing Money in the U.S.  ⭐ Budgeting helps you stay in control, even if your income changes week to week. Start with a simple plan and adjust as needed.  ⭐ Bank accounts are essential for getting paid, paying bills, and keeping your money safe. You don’t need to be a U.S. citizen to open one.  ⭐ Debit cards use your own money; credit cards use borrowed money. Each has pros and cons—know the difference before you choose.  ⭐ Credit matters for housing, jobs, and future financial options. You can start building it by practicing good financial habits like paying bills on time.  ⭐ Stay alert for scams. Don’t share personal info unless you’re sure who you’re dealing with, and use official sources for financial and immigration help.  ⭐ Free resources are available to help you learn more and make informed decisions.

 

Last Updated October 2025 

ImportaMí is a project dedicated to providing reliable, accessible, and relevant information to unaccompanied children and their sponsors in the United States. ImportaMí is part of Signpost, an initiative of the International Rescue Committee in collaboration with other agencies that creates digital help centers to empower people impacted by conflict, disasters, poverty, and violence. 

 

Sources: 

Children’s Immigration Law Academy. (2025, July 30). Be Smart With Your Money: Financial Tips for Unaccompanied Youth. https://cilacademy.org/2025/07/30/new-resource-be-smart-with-your-money-financial-tips-for-unaccompanied-youth/ 

Hands on Banking. (2025). Youth Home – Financial Education for Students. https://youth.handsonbanking.org/ 

Switchboard. (2024, February 20). Resource Collection: Financial Empowerment for Refugees and Newcomers. https://www.switchboardta.org/resource-collection-financial-empowerment-for-refugees-and-newcomers/ 

Annuity.org. (2025, May 20). Financial Literacy: A Guide for Immigrants & First-Gen Americans. https://www.annuity.org/financial-literacy/first-generation-americans/ 

Consumer Financial Protection Bureau. (2023, August 8). Financial education programs serving immigrant populations. https://www.consumerfinance.gov/data-research/research-reports/financial-education-programs-serving-immigrant-populations/ 

USCIS. (2023, February 21). Common Scams. https://www.uscis.gov/scams-fraud-and-misconduct/avoid-scams/common-scams