house with american flag

It can be difficult to maintain hope in the American Dream. The media bombards us with a constant stream of images telling us what the “good life” is. Showing us all the material things that we should have to be successful. Even people of modest means can feel the pressure to buy more. Imagine how people living paycheck to paycheck and struggling to make ends meet must feel when they read headlines like these:


  • How to Make Your First Million!
  • Is 1 million Enough to Retire?
  • Prepare for Emergencies – Have at least 6 months of wages saved.
  • Planning your European Vacation
  • Saving Money on Designer Clothes
  • Why You Need to Save 10-15% of Your Income.
  • Making the Most of Your Companies 401k Match.
  • Protecting Your Estate for Your Heirs
  • When Will We See the World’s First Trillionaire?

Perhaps those living in poverty are isolated from these types of stories, but images on television and in film constantly reinforce the message that if you don’t have “X” you aren’t successful.

The have-nots are encouraged to focus on non-material things while being surrounded by a society that seems to determine your standing by the type of car you drive, how big your house is, and how many vacations you take. Studies show that happiness does not come from material goods, but not being able to feed, clothe, and shelter your family will make it very difficult to be happy.

An article on from December 2017 cites a Pew Research Survey showing that only 11% of Americans feel getting rich is important to achieve the American Dream. The conclusion of the article defines the American Dream as follows:

“Money can pave the way to the American dream: owning a home, raising a family, having a successful career, retiring comfortably.”

I can’t help but wonder who was surveyed? Did the sampling really contain a cross-section of all segments of society?

It Takes a Good Income to Buy a Home

Let’s take a closer look at the American Dream beginning with home ownership. Since the recession of 2008, the economy continues to recover and add jobs. Unfortunately, most job growth is occurring in the service or healthcare sectors; traditionally lower paying jobs. The decline in blue-collar, well-paying manufacturing jobs continues. The current unemployment rate of 4.1% is low but does not tell the whole story. The Bureau of Labor Statistics provides the following information regarding who is considered employed:

People are considered employed if they did any work at all for pay or profit during the survey reference week. This includes all part-time and temporary work, as well as regular full-time, year-round employment. Individuals also are counted as employed if they have a job at which they did not work during the survey week, whether they were paid or not because they were:

  • On vacation
  • Ill
  • Experiencing childcare problems
  • On maternity or paternity leave
  • Taking care of some other family or personal obligation
  • Involved in a labor dispute
  • Prevented from working by bad weather

Gig Economy Workers

Many people are now employed in the gig economy (think Uber or Lyft) or as independent contractors. These jobs typically have no benefits such as health care, paid time off, or a guarantee of future work. The unemployment rate does not account for millions who for whatever reason are not working and not actively seeking employment. Automation is also playing a role in declining income and available jobs.  Given the current employment picture, homeownership is one part of the American Dream that is out of reach for many people in our country.

Single women face a difficult path to home ownership. I received an email from Ryan at telling me about a guide they have created to help single women manage credit and get a mortgage. According to the email:

Despite making up almost one-fifth of the home buying market, single women are more likely to be denied mortgage loans than any other group. We created a guide that breaks down the best strategies for positively managing credit throughout the home-buying process and how to utilize a strong credit profile to combat gender bias.

Is a Comfortable Retirement Possible?

woman with piggy bank

What about the dream of retiring comfortably? According to data in an Economic Policy Institute report, Retirement in America, more than half of all families have no money saved for retirement. Many households have less than $1000 in regular savings. An article by Emmie Martin featured on CNBC points out that 39% of Americans do not have enough savings to cover an emergency expense of $1000.

An unexpected expense can quickly push people into debt. You better hope your car does not break down! Statistics show that those in the higher income brackets have a higher level of savings. Given that retirement contributions by employers are calculated as a percentage of the employee salary, the gap in retirement savings is difficult to close. Those who make more money, contribute more and receive more in matching contributions from employers.Income inequality continues into the retirement years.

Many Workers Have No Employer-Sponsored Retirement Plan

According to data in an article in the Wall Street Journal by Anne Tergesen,  “More than 30 million full-time workers don’t have access to a retirement plan at their workplace, nor do millions of part-time or independent contractors.” The state of Oregon has created a program called OregonSaves for employees and who do not have a company-sponsored retirement plan. Employees contribute to a personal Roth IRA that will stay with them for life regardless of where they work.

Compounding the challenge of retiring comfortably is the dramatic rise in health care expenses now estimated to cost an individual $245,000 during their retirement years.  (Fidelity).

If you are living paycheck to paycheck, putting money in any type of savings account might just be impossible and achieving the American Dream may be just a fantasy from the early days of American history

Income Inequality – The Root of the Problem

At the heart of the problem is the extreme income inequality that exists in our country. It is time for corporations to return more of the profit to the employees in the form of higher wages and better benefits. People are the heart and soul of any organization and need to be first when the work they do results in a  profit.  Until we address this problem, the American Dream is just that – a dream.

What are we going to do about it?

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