Young People Should Take 2 Steps If They Want to Buy a House Without Generational Wealth, Says Financial Educator Who Paid Off $50,000 Debt in 2.5 Years Giovanna Gonzalez, The First Gen Mentor and author of 'Cultura and Cash,' reveals how to improve net worth despite a "different starting line."
By Amanda Breen Edited by Jessica Thomas
Like many first-generation Americans and college students, Giovanna Gonzalez, the daughter of Mexican immigrants who came to California in the 1990s, thought she'd "done everything right" by attending college, choosing a practical degree in economics and settling into an office job. She was earning more money than her parents ever had, but without any of the necessary tools to manage it, her twenties were "chaotic," a cycle of "bad roommates" and "toxic workplaces" she couldn't escape as she lived paycheck to paycheck.
Image Credit: Courtesy of The First Gen Mentor
Amid the turmoil, Gonzalez had an epiphany: I can keep living like this, but this isn't what my parents want for me. They want better. So she began to teach herself financial literacy, reading more than 50 personal finance books and listening to countless podcasts until she gained confidence in her ability to create a financial plan that would help her pay off $50,000 in debt from her student and car loans and begin building up her savings.
"There was definitely a fire inside me that was like, This is so unfair that I didn't have access to this information sooner because I could have done things differently," Gonzalez recalls. "So I thought, How can I share this information with other women?"
"I focus a lot on bringing awareness that our starting line is different from our peers.'"
Gonzalez started teaching financial literacy through a volunteer program with The Young Women's Christian Association (YWCA), and in March 2021, shared some of her tips on TikTok, all while continuing to work her 9-5 job in investment management. Ultimately, Gonzalez's social media presence "took on a life of its own" and helped establish her brand: The First Gen Mentor. Her book, Cultura and Cash: Lessons from the First Gen Mentor for Managing Finances and Cultural Expectations, was published earlier this year.
Image Credit: Courtesy of The First Gen Mentor
"I focus a lot on bringing awareness that our starting line is different from our peers,'" Gonzalez says. Even though she was "scraping by" with an entry-level position herself, Gonzalez says family members would often depend on her for extra cash in case of emergencies; meanwhile, many of her contemporaries had received help with college tuition and so had little or no student debt, and some of them had also been given down payments for a home.
Related: These Are the 5 Most Unaffordable U.S. States to Buy a House, According to a New Report
Home prices across the U.S. increased by 43% between 2019 and 2022, while income rose just 7% in the same period, per a Harvard University report. What's more, 38% percent of homebuyers under age 30 used either a cash gift from a family member or an inheritance in order to afford their down payment, with 23% using the former and 21% using the latter, according to a survey of recent movers commissioned by Redfin last spring.
"A lot of people are sold this lie that your primary home is an investment."
Many young people are convinced that buying a home is a solid financial move, but Gonzalez warns that's not always the case. "A lot of people are sold this lie that your primary home is an investment, and that's not true," she says. "I take the time to educate my community online and my readers that your primary home is not an investment. It's a liability because you owe a mortgage on it. Once you pay off that mortgage, then you have an asset you can sell."
After Gonzalez paid off her debt and saved $20,000 within three years of getting strategic with her personal finances, she could have used that money for a down payment on a home in Phoenix, Arizona, she says — but that wasn't a priority for she and her husband, who are child-free and enjoy having the flexibility to relocate to a new city every couple of years.
Whether young people are eyeing homeownership or another major financial goal, Gonzalez says that two moves are key. First, you have to be "intentional" with your money; it's not enough to just pay the bills on time and keep a roof over your head — a mindset trap Gonzalez admits she fell into as a recent college graduate. Instead, you have to prioritize a financial plan, creating a budget and investment strategy that will actually help build your net worth over time.
Next, you have to be "aggressive" when it comes to tackling your financial goals — and that might mean making some sacrifices. In 2019, Gonzalez left most of her friends and family in San Diego to move to Phoenix, where her money would go further. "I got a new job in Phoenix," she says, "and because the cost of living was much lower, it finally gave me this space to be able to be aggressive with paying off my debt, aggressive with building up savings, aggressive with long-term investing."
"[I can become] that person that they already know, like and trust."
Now, Gonzalez looks forward to taking the next step in her personal finance career — and becoming a certified financial planner. She interned for one in college, and although she was interested in pursuing the path herself, she opted against it because her boss was an entrepreneur, "constantly networking" to get new clients, and without the "safety net" she felt a corporate job would provide.
"But now I've essentially been an entrepreneur for three years," Gonzalez says, "working on my brand, The First Gen Mentor, as a public speaker, influencer and now as an author. My audience [is aging with me], and they're already like, 'Okay, great. You're teaching me all this stuff. I'm in a good place where now I need to rely on a planner or an advisor. Can you recommend anybody?' So instead of sourcing it out, [I can become] that person that they already know, like and trust."
This article is part of our ongoing series highlighting the stories, challenges and triumphs of being a Young Entrepreneur®.
