Living the American Dream is often portrayed as a life of stability, comfort, and contentment, but achieving that dream now comes at a very high price.
From weddings to raising children, buying a home, and planning for retirement, the average cost of living to live the good life in the United States has reached $4.4 billion.
This figure, which represents a combination of personal preferences and important cultural events, underscores the growing financial challenges of the American people.
While the American Dream means different things to different people, certain milestones are often associated with it.
These include owning a home, driving new cars, raising children, taking annual vacations, and saving for retirement. Here’s a closer look at how these costs stack up.
Retirement Savings: $1.6 Million
Average Age: 22–65
Retirement planning forms the cornerstone of financial stability in the American Dream. Ideally, savings should start early, growing over decades to reach $1.6 million by age 65—enough to withdraw 4% annually over 20 years, accounting for inflation.
However, many Americans fall short of this target. Only 54% of US households have retirement accounts, and the average savings is only $185,000 for those approaching retirement age.
Rising health care costs and inflation have made the retirement equation difficult, as one in three savers believe they won’t have enough to retire comfortably.
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Home Ownership: $929,955
Average Age: 35–65
Home ownership has always been a symbol of the American Dream, but rising housing costs have put it out of reach for many. On average, buying and financing a home with a 30-year mortgage costs about $930,000, including taxes and insurance, but not including maintenance or HOA fees.
Although the national home ownership rate stands at 65.6%, affordability challenges persist, with younger generations delaying home purchases due to rising interest rates and stagnant wages.
Raising Two Children: $832,172
Average Age: 29–53
Raising children is one of the most expensive aspects of the American Dream. The cost of raising two children to the age of 17 is estimated at $611,694, and adding to the cost of public, in-state college tuition brings the total to $832,172.
Unsurprisingly, financial concerns are the main reason many adults choose to forego having children altogether.
Marriages: $44,300
Average Age: 29
Getting married remains a milestone for many Americans, but the cost of saying “I do” has increased recently.
As inflation drives up the prices of venues, flowers, and restaurants, the average wedding now costs $44,300, a significant increase from pre-pandemic levels.
New Cars: $811,440
Average Age: 29–75
The cost of new car ownership during the growth period can reach $811,440, which only covers the monthly payments for two cars.
Other ongoing costs such as insurance and maintenance increase this figure. Despite the enduring appeal of new cars, many Americans prefer used, affordable cars.
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Annual Vacations: $179,109
Average Age: 22–85
A week’s vacation each year between the ages of 22 and 85 adds up to $179,109 over your lifetime. While the holidays provide an opportunity to rest and recharge, many Americans struggle to fit them into their budgets, putting other expenses first.
Pro tip: Travel insurance is necessary to protect that expensive vacation. Here is a list of the best insurance companies.
Owning a Dog and a Cat: $36,626
For pet lovers, the combined cost of caring for one dog and one cat over their lifetime is $36,626.
Pet care, feeding, and grooming contribute to these costs, making pet ownership a meaningful but expensive part of the dream.
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Funeral: $8,453
End-of-life expenses are an often overlooked part of financial planning. The average funeral now sets back $8,453, a figure that many families struggle to afford.
Planning ahead can help ensure that these costs do not become a burden on loved ones.
Pro tip: Life insurance is a necessity to protect your family. Here is the place to get a free, no-obligation quote.
The Rising Cost of Aspiration
The $4.4 million price tag attached to the American Dream highlights the financial obstacles facing individuals and families.
Dual-earner families with a Bachelor’s degree may earn a combined $5.6 million over a lifetime, but high costs and structural challenges—such as income inequality and inflation—make achieving the dream difficult for many.
Whether it’s scaling back discretionary spending, investing in education, or rethinking retirement strategies, achieving the American dream may require a rethought approach.
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