The lifetime expense of marriage, two children, homes, healthcare, cars, and education is $3.5M--more than what most earn in a lifetime
According to Investopedia, the American Dream now costs $3,455,305—the estimated lifetime cost of common milestones including marriage, two children, homes, healthcare, cars, and education. That staggering amount certainly puts a hard number to a sentiment many people have felt in recent years--that the American Dream is less and less realistic of a goal.
Is The American Dream Over?
For decades, people were sold on the idea that anyone could achieve the American Dream. There was an optimistic view that anyone—regardless of their background—could move up if they applied themselves and worked hard.
However, a recent survey by the Wall Street Journal and the National Opinion Research Center found that only 36% of voters said the American Dream “still holds true,” down from the 53% who believed in U.S. prospects in a 2012 edition of the survey and 48% in 2016.
This low confidence in the American Dream is related to rising housing costs, high inflation, burdensome student loans, and record-high credit card debt. As a result, many Americans have delayed major aspirational milestones and purchases, like buying a home, getting married, and having kids.
The American Dream Now Costs $3,455,305
While costs are vary state-by-state, here is a breakdown of the lifetime costs of marriage, two children, homes, healthcare, cars:
| Milestone | Cost | Description |
1 | Wedding | $35,800 | Average cost of a wedding and engagement ring (2022, TheKnot.com) |
2 | Home | $796,998 | Average purchase price for a home, with lifetime mortgage costs. Mortgage assumes 10% down payment, 30-year fixed loan at 7.2% interest. (September 2023 purchase price and rates, Zillow, CFPB, St. Louis Fed) |
3 | Car | $271,330 | Average purchase price for used car. Total shown for 10 purchases (6-year old used car, lasting around 6 years each) over a lifetime (driving ages 16-80). (2023, iSeeCars.com) |
4 | Hospital birth | $5,708 | Average out-of-pocket costs for those enrolled in large group plans ($16,011 covered by insurance). Total shown for 2 children. (2018-2020, Peterson-KFF) |
5 | Raising children | $576,896 | Average cost of raising a child until age 18. Total shown for 2 children. (2015 USDA, adjusted for inflation to 2022) |
6 | Health Insurance | $934,752 | Average family premium costs. Total showing 39 years of current annual costs (ages 26-65). (2018-2020, Peterson-KFF) |
7 | Pets | $67,935 | Midpoint cost of lifetime care (15 years) for a dog and cat. (2022, Synchrony) |
8 | College | $42,070 | Average cost of one year at a public in-state 4-year institution including room and board. Total shown for 2 children. (2020-21, National Center for Education Statistics) |
9 | Retirement | $715,968 | 80% of 2022 median household income. Total showing 12 years (average life expectancy past 65). (2022, U.S. Census, CDC) |
10 | Funeral costs | $7,848 | Average costs of a funeral with a viewing and burial (2023, PolicyGenius) |
Source: Peterson-KFF Health System Tracker, USDA Expenditures on Children by Families, iSeeCars Study, National Center for Education Statistics, The Knot 2022 Real Weddings Study, Zillow, Synchrony Lifetime of Care Study, U.S. Census, CDC, PolicyGenius
Can You Afford the American Dream?
Stacy Mastrolia, associate professor of accounting at Bucknell University in Pennsylvania, said she’s not sure if the American dream exists anymore. “If that is the American dream — two parents, two kids, owning a house somewhere — then the average American family needs to be better employed,” she said.
Many Americans would agree that sentiment. Less than half of respondents in a 2022 Gallup poll said they think today’s youth will have a better life than their parents — an 18% decline since 2019.
“This is the current situation — the middle class isn’t thriving financially, doing the things that our parents did in terms of working one job or living off of one income,” Mastrolia said.
Comments