Downgrading the American Dream

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The American Dream has been downgraded, too.

Writer James Truslow Adams coined the phrase American Dream and defined it in grand terms in 1931, when he called it “that dream of a land in which life should be better and richer and fuller for everyone, with opportunity for each according to ability or achievement.”

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In the decades that followed, the American Dream was redefined in less elegant and purely materialistic terms. It became about home ownership. Today, it seems, the American Dream has taken another hit. It is simply about being able to quit work before you die.

Nearly half of adults say that a comfortable retirement is the new American Dream, far outpacing the 17% who cling to homeownership as the embodiment of Adams’ vision, according to a recent poll by the National Endowment for Financial Education. These results might have something to do with the housing bust. But my guess is that this shifting sentiment has more to do with depleted savings, ravaged portfolios, stagnant wages and terrible job prospects – all of which conspire to force Americans to work into their 80s.

At times, retiring early might also have been regarded as the American Dream. If so, it too has taken a terrible hit. Just 5% say that’s an important goal.

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And what of the concept that each generation should do better than the next? In the poll, 62% say their parents have achieved the American Dream while only 57% say they are living the American Dream. Yet another blow.

For what it’s worth, an overwhelming majority (70%) says that their inability to save is what is holding them down. No doubt financial hardship contributes to this inability. Nevertheless, perhaps we should redefine the American Dream again – as living within your means.