Practical Financial Tips: Building Wealth, Paso a Paso

As Latinos, we value family, hard work, and community. But when it comes to growing personal wealth, many of us face challenges—whether it is navigating the financial system or just finding the right resources. If you are trying to generate wealth and strengthen your financial health, here are some practical tips to help you on your journey.

By Alfredo Cantu , COO & Co-Founder, IM Financial

The First Step to Financial Fitness - “You can’t lose weight without stepping on the scale.”

Just like you cannot lose weight without stepping on the scale, you need to track your spending to take control of your finances. The first step is understanding where your money is going—rent, groceries, bills, and even entertainment. Apps like Mint (which offers free options) make it easy to see the big picture. Once you know where your money goes, you can start making adjustments, cutting unnecessary expenses, and redirecting more toward savings and investments.

Build Your “Colchoncito” - “If you need money fast, you’ll end up with expensive money.”

Life is unpredictable—whether it’s a medical expense or your car breaking down. Building a “colchoncito” (a little cushion) is key to avoiding debt and reducing stress on your finances. Start by setting aside a small amount each month, working toward a savings goal of three months of living expenses. Even small amounts will add up over time, giving you peace of mind when life throws an unexpected curveball.

Just Like in Love, Simple and Selective: Too Many Cards, Bills, and Subscriptions Won’t Let You Grow - “Establish order, and habit will take care of maintaining it.”

Building credit takes discipline, but that doesn’t mean signing up for every card or loan that comes your way. Keep it simple. With so many companies competing for your money, be selective about where you establish financial relationships. Having eight credit cards or multiple loans only increases your chances of missing a payment, which can hurt your credit. Instead, focus on a few essential cards, pay them off consistently, and watch your credit improve. For more: www.zillow.com/learn/mortgage-credit-scores

Learn About Rates: Avoid Predatory Loans - “Fast money can trap you in long-term debt.”

Payday loans, cash advances, or “quick cash” options often seem tempting, but they can come with interest rates as high as 300-400% APR. These predatory loans are designed to keep you trapped in debt. A simple rule to follow: avoid any loan with an APR above 36%. Look for better rates at credit unions or community banks, which often offer more affordable loan terms.

Out of Sight, Out of Mind: Invest Your Money - “Out of Sight, Out of Mind”

If you’re the type to snack on chips just because the bag is open, you know the power of temptation. The same goes for your money—if it’s easily accessible, you’ll spend it. Put your money somewhere you can’t touch it, like an investment or high-yield savings account, and let it grow without the temptation to spend. Out of sight, out of mind means your money is working for you. Resources: www.nerdwallet.com/best/banking/high-yield-online-savings-accounts

Keep Learning: Financial Education is All Around You - “Growing wealth is like growing a plant—it takes time, care, and attention.”

Just like a plant needs regular watering to thrive, your financial knowledge needs consistent nurturing. There are tons of free resources—from podcasts to blogs—that can help you stay informed. Find what works best for you, and make learning about money a regular habit. The more you invest time, your primary resource, in your financial education, the more you’ll shift your mindset, helping you make smarter choices and grow your wealth.

No Estás Solo: Use Community Resources - “You’re not in this alone.”

Remember, there are many community programs, non-profits, and financial advisors dedicated to helping Latinos achieve financial success. Whether it's financial literacy workshops, free consultations, or support networks, these resources are designed to guide you on your journey. Don’t hesitate to reach out and take advantage of what’s available—there’s always someone ready to help you take the next step toward financial stability and growth. For example, check out the Hispanic Wealth Project at hispanicwealthproject.org.

EXTRA: What About Homeownership? - “This might feel stressful, but it’s one of the best ways to build wealth.”

Homeownership can seem overwhelming, but it’s a critical step toward building long-term wealth and should be on everyone’s mind. While it might feel like a big goal, the first 7 steps we’ve discussed lay the groundwork for achieving it. We’ll save the deep dive on homeownership for another time—pa' la próxima—but know that the financial habits you build now will pave the way for this important milestone.

About Alfredo Cantu is an accomplished entrepreneur and business leader with over 15 years of experience in finance, product development, and strategic operations. As the co-founder and COO of IM Financial, a fintech focused on improving access to financial services for the Latino community, Alfredo leverages his expertise in wealth management, fintech innovation, and market expansion. His entrepreneurial journey includes founding startups in consumer goods, fintech, and venture consulting. Alfredo is passionate about driving financial inclusion and helping others build long-term wealth.

Disclosure: Please note that the information provided in this article is for educational and informational purposes only and should not be construed as financial advice