According to a recent report by Investopedia, the American Dream now comes with a hefty price tag of $4.4 million over a lifetime. The financial media site calculated the lifetime costs of classic American aspirations, including homeownership, parenthood, a fancy wedding, new cars, annual vacations, pets, a comfortable retirement, and a dignified funeral. The breakdown of the $4.4 million lifetime cost includes $1.6 million for retirement, $930,000 for homeownership, $832,000 for raising two kids, $811,000 for owning new cars, $179,000 for annual vacations, $44,000 for a wedding, $37,000 for pets, and $8,000 for a funeral.
Investopedia’s editor-in-chief explained that the report was created because “the American Dream was one of the most searched terms on our website.” The new report focuses more on things Americans want, not just need, compared to an earlier report released in 2023 that put the lifetime tab at only $3.4 million. While the $4.4 million figure may seem daunting, financial advisers say the American Dream is attainable, especially for a family with two earners and good saving habits.
Cost of the American Dream
The average American with a bachelor’s degree earns about $2.8 million across a career, and adding a second income can make the $4.4 million mark achievable. Financial advisers stress the importance of having a comprehensive financial plan to attain the American Dream. Some of the numbers in the report, such as $1.6 million in retirement savings, may seem high, but other components like homeownership may not cost as much as one might think.
Achieving the American Dream requires careful planning and prioritizing, but it’s within reach for many Americans with the right approach. The report allows readers to create their own plan for achieving the American Dream, tailoring it to personal preferences and needs.
