Some Americans think financial stability and homeownership are out of reach but a good strategy can help them get out of debt, buy a home and prepare for retirement to achieve the American Dream.
More than 80 percent of Americans agree that the heart of the American Dream is financial stability for themselves and their family, owning a home and achieving financial independence, according to a recent study from Massachusetts Mutual Life Insurance Company (MassMutual). Despite a clear vision of what the American Dream looks like, less than half of those surveyed are confident that they can attain it and 30 percent believe the American Dream is going to disappear altogether.
Why? Various forms of debt coupled with insufficient savings put the American Dream out of reach for many families. Less than 30 percent of American families are prepared for a financial emergency with more than 6 months expenses saved. More than 30 percent of American families agree that they should be doing more to save for the future but are struggling just to get by.
While 80 percent of American families are confident in day-to-day or short-term financial decisions, more than 40 percent lack confidence when it comes to planning for the long-term. Nearly 40 percent worry they will outlive their retirement and more than 60 percent don’t think they’re financially prepared for retirement. With rising costs of healthcare and the need for long-term care, it’s understandable Americans are lacking confidence that they have enough saved to cover expenses in retirement.
The cost of tuition, books, fees, room and board has increased more than 50 percent over the last 10 years and the percentage of families with debt from student loans doubled from 11 percent to 22 percent over the last 5 years. Paying for their children’s education is still a financial priority for almost 60 percent of American families and the average amount of student loan debt per family is $39,900.
The growing cost of college and the outrageous $1.5 trillion in student loan debt is a national concern, and may soon reach a breaking point. What hasn’t changed is that American families are still determined to see their children succeed.
Does any of the information gleaned from MassMutual’s survey mean the American Dream is out of reach? No, but it does mean that achieving it requires research, careful planning and consistency. With a little research (and access to tools and calculators on this website), you can figure out how much money a family needs to earn and save for children’s college and parent’s retirement. A carefully planned budget can help families meet their financial goals, but only if it’s adhered to as a routine. A ‘loose’ budget might help families get by for now, but it won’t protect their financial futures.
Achieving the American Dream has never been an easy task. American families that take it upon themselves to learn cost-saving strategies will find that the American Dream is well within reach, even if it’s a few years down the road. Luckily, as more people live well into their 80s and 90s, there’s plenty of time to get there.
Leave A Comment