Is the American dream dead? The American dream is the promise of the possibility of prosperity and success for everyone. Higher education is beyond the reach of many people, the housing market is a bust and there are no jobs! What should you do?
Education as an investment
A college education is expensive! Maybe it should be, since it will change your life. It changes the trajectory of your career and will add significant earnings over your lifetime. It is a great investment in your future, but it is not a right. Invest in yourself was an article I wrote recently about getting a good education and grades increases your opportunities. It starts early and affects your entire life and career. What are your skills? What knowledge and talents did you accumulate to make you more marketable?
Education starts early! In elementary school you learn how to read, write and arithmetic. You mature emotionally and physically as you grow more independent. In middle school, you begin to master physical and mental challenges including writing, math, science and much more. High school you develop many problem solving skills, analysis, writing, science, teamwork, social and physical skills. Your training is not done. You made your investment learning the skills and achieving good grades. What do you do next?
Post secondary training can be college or a trade. Without additional training, your career will stall. You need additional training to reach the American dream. It is your investment in yourself. Training does not stop because you do not go to college or formal training. Every company continually trains their employees in some form. Companies also offer tuition reimbursement too; they are encouraging employees to continue their education. If you are not keeping up with information in your career, you may be without a career.
Can you have a good education and unemployed? What you do with your education is as important as all those years in school. A college degree does not guarantee a good life. It helps you get a professional job and then it is up to you. In some ways it is similar to getting into a good university, you still need to perform in order to graduate. When you graduate, employers will measure your performance using grades and other participation in activities. Landing that first job is very difficult in this economy.
Rent or Buy Homes
Should we get used to renting? If you do not have a down payment and good credit, you should not even think about buying a home. Renting may make sense if you will only be in that area for a short period of time (less than 5 years). The housing market has not stabilized yet! Home prices are still falling in some areas. Home ownership rates decreased in every region of the country. The number of vacant homes grows by 44%. If Congress changes the mortgage deduction combined with depressed housing values, it may make more sense to rent rather than buy. Home ownership fell to 65% which is drop of nearly 5%.
More people renting will increase rents. Mortgage rates are the lowest in sixty years. All this does not matter, if the price of homes is still dropping. Is the American dream of owning your home over? Is this your opportunity to buy? Are we at the bottom of the market? No one can tell you until much later. If you buy now, there is a risk of prices falling further. Some people are buying, they all cannot be wrong! Only time will tell.
Jobs, Jobs, Jobs
If you are unemployed, you know the American dream is over! The best time to get a new job is right after you lose the last one. The longer you are unemployed, the harder it is to get a job. Either there are no jobs or lower pay for the same jobs. What should you do? Use your network, people who know of jobs and know you will help you find a job. In the meantime do what you have to just to survive. Now is the time for you to acquire the skills, knowledge or degree to enhance your opportunities.
People with college degrees have the lowest unemployment rates. What does that mean? Get a college degree and you are less likely to be unemployed. If you do not want to go to college, there are trades or other careers that have good prospects. The bad economy will affect everyone, but there are careers such as auto mechanic, repair trades and others that still have opportunities.
Wrap Up
What should you do? Spend the time in school getting the knowledge, skills and grades to go to college. Community college is still reasonable and there are apprentice programs looking for qualified people. Take the time to acquire new skills or training to make you more marketable. Waiting to buy? Renting may be a good choice until the housing market improves. No one can predict the bottom of the market until we are passed it. Whether you are employed or unemployed, you need to keep networking. Your network is the best resource for finding jobs. Is the American dream dead?
Photo by: DonkeyHotey
Once you get a good education, I believe sacrificing out side workplace fun and concentrating on hard work is essential for young graduates, at least for couple of years after joining the work force. After you establish a brand for yourself and gain enough authority in your field of work jobs would follow you rather than the opposite.
In nut shell, hard work and diligence is key during college years and during first few years in work life.
I agree, but there has to be a balance. Early in my career, I worked 60-70 hours per week and moved up quickly. This was also the time when we started a family. I went to work early so I could be home at a reasonable time.
Things have certainly gotten harder, but I don’t think the dream is dead. As always, new opportunities will pave the way as old ones die out.
Absolutely true! It is easier to start businesses on the internet, credit is tougher and money (loans) are tight or difficult. If it were easy, everyone could get credit or money and we would have a bubble all over again.
I still have my American Dream. Hell, it was one of the reasons I moved to the US because this country offers so much more. Yes, you have to work hard for it, but my dream is still alive. great post!
I think earlier whatever field you started with, it was easier to end up in a field that had potential and made people happy. Now with the global economy competition has increased and we are required to do a lot of critical thinking on what we want to do with our lives sooner than it used to be. Mistakes made in the young age are haunting people more than before.
There is more responsibility on the parents to give a head start with the kids. Not with money, but with good financial habits, with figuring out the interests of the kid and nudging along the right path. American dream is not dead. It just got harder.
Although I agree with part of your assessment, good parenting and financial habits was and is always important. My adult children (37 & 34 yrs. old) are successful thanks to both. I think there is more emphasis because we are in a PF network and the bad economy.
The American is alive and well, however it may be easier or more difficult depending on your circumstances. If you want to buy real estate or income property, now may be the time to buy. Prices are low and interest rates are the lowest since the 1950s. Are there risks? Yes, but there are opportunities.
Now is the perfect time to buy properties if you have money/credit to do so. I bought 2 properties in the last year and working on my 3rd. I no longer have to compete with first time home buyers. I’m making a killing right now!
I don’t know if I would say the American Dream is dead I just think it has changed in the sense of what it looks like. Years ago post war when there was a boom in the economy and in money in people’s pockets, getting the big house, the good job etc was a feasible reality. Now that financial times have changed and there isn’t that economy boom and people don’t have extra money in their pocket that dream is no longer a reality. Now the dream is to be debt free, live in a safe place, be able to feed and educate your family, and keep your job. If you can do all of these things than you are living “a dream” compared to so many other people in this world.
I agreed with you right up to your last sentence! What you describe as a dream is and should be normal life in the U.S..
True in the US yes, however in many other parts of the world this regular life is a dream for them. It something they may never see come to reality in their own lives. When I traveled to Cambodia this past spring I saw this for my own eyes. Living in a safe place, going to school, and having a job was not the norm. It was a dream for many of the people there.
Thanks for that perspective. I think I take this for granted although I travel too.
I always thought the American Dream was doing better financially than your parents. That probably is more difficult for most people now with the recession. Education/post-secondary training with plenty of hard work is key.
The recession is temporary! I think this generation faces no more challenges than previous ones. Housing and interest rates are at their lowest point. The stock market and ecoomy is in turmoil. If your job/career is either in jeopardy or you are unemployed, everything I said is meaningless. Hopefully, this just temporary!
I totally don’t think the Amerian Dream is dead. It is still there, but I don’t know that people are as motivated to realize the American Dream. Look at all the changes that have gone on in the last 100 years. People must adapt and find a new way to make whatever they can do better than anyone else can. You can’t just muddle along like a dinosaur and expect to make great money. You must adapt, and you must innovate.
College is absolutely required. When I graduated high school, most of my school mates did not go to college, but that is because we were in a low income area. There were jobs that could be had right out of high school, and I was envious that a lot of my friends had new cars where I was working myself to death to get through college. However, it all more than paid off in the end, you just have to delay the reward a bit.
My kids will go to college, and they won’t think there is any other option.
Housing is more affordable than ever and interest rates are the lowest in years. The only issue is if housing has hit bottom. Post secondary training or college is a necessity. A lot of that training is technological/computers. Even an auto mechanic is more technological than ever before. College in the long run is a great investment.
I personally don’t think that the American Dream is dead. The Dream that I refer to is the opportunity to improve yourself, buy a home if you desire, live in a safe environment, etc. That dream is very much alive. Are there more people struggling? Of course there are, but there are also people winning too, and winning big time! We have opportunities that no other generation has ever experienced. I don’t diminish that in the slightest.
I agree, housing is at the lowest prices in a long time and interest rates lowest in 60 years. The people who can take advantage of that are people who did the right things. Good credit and a down payment is an advantage. Is there a risk? Of course!
I don’t think the American dream is dead by any means, rather people assume they should get to the goal/end a lot sooner than people once believed.
I think some parts of the American Dream is attainable sooner, but it takes saving and a good earning stable career.
I agree with you Evan. The American dream is alive and well and like past years you have to work for it instead of finance it on cheap credit!
I agree it is still possible although it is a little more difficult. You need good credit and a secure job to achieve it.
I am not sure if it is more difficult then it ever was…that is why it was a dream for most. Wouldn’t be much of a dream if everyone could attain it.
Everyone should have the opportunity, but not everyone will achieve it.
No, the dream is alive. But, the rest of the world has caught up with America and want to live like we do. It’s more competitive than ever.
The American Dream is alive for some people, but many feel very insecure about their job and home values.
The American Dream is alive for some people, but many feel very insecure about their job and home values.
In this economy, you just need good credit and a secure job to achieve it which leaves out many people.
Things are definitely tough right now, there is no doubt about that. People who have not been personally touched by the recession know plenty of people who have.
People with years of experience cannot find a job– and the problem is huge for those over 40. I know that the Occupy Wall Street people are being snickered at– but they at least are TRYING to do something about what they see happening. Maybe we should all be out there with them– I for one would be happy to protest the fact that our government is allowing so many jobs to go overseas. (Of course, it is much warmer here in my house…)
It is certainly harder for unemployed and older workers, but I government reacts more to special interests than the rest of us. If we do not like what is going on in Washington, we need to go vote in higher numbers.
I agree with your points that there is no hope of success remains for America beside war. American policy makers are taking their country to wrong path because of this there are more unemployment, suicides and no education.
I think the American dream was fuelled by the American work ethic, which is taking a hit in some places. There is no doubt that globalization is going to mean some downwards pull on our standard of living, but the idea of working hard to achieve your goals will always be there for those that want it. The USA still has some of the world’s best academic and physical infrastructure, and the best business climate around. People simply need to start looking inwards again, instead of asking for handouts from the government, or “the 1%.”
I think it will be harder for some (less skilled) and easier for others (good credit and cash).
I am not saying there is no hope, however it is less available to everyone. In some ways it is easier to buy a home,except for the volatile housing market, tight credit and unemployment.
I think it’s still there, but starting to become a myth for many…
I do think that it’s going to take more than just hard work these days, especially with the wage rate inequalities amount the different countries. Perhaps globalization is killing the American Dream, but slowly so many don’t recognize it?
Globalization principally affects manufacturing. The United States is still a leader in creativity and innovation. The American Dream may be more difficult, but it was never easy. Some people may need training or education to reach their goals, but that was always true.
Why is the White House subsidizing oil when it could be subsidizing education? I wouldn’t say that the American Dream is dead, but its becoming harder and harder to achieve.
Our priorities are a little upside down! Are we still subsidizing tobacco? We used to! Most of education is paid for from property taxes within each state. The housing bubble has decimated school budgets.
Our priorities are a little upside down! Are we still subsidizing tobacco? We used to! Most of education is paid for from property taxes within each state. The housing bubble has decimated school budgets.
Why is the White House subsidizing oil when it could be subsidizing education? I wouldn’t say that the American Dream is dead, but its becoming harder and harder to achieve.
I was very fortunate to go to community college, then a state university while living at home to cut costs…then I reversed those savings by attending graduate school! Anytime someone asks me if they should get a graduate degree I offer a stern NO (I mean, unless they have thought it through and have a concrete plan or job offer that requires it).
Education doesn’t entitle students to what it used to, nor should it. Too many of my fellow students have graduated with plenty of “experience,” but little knowledge or skills. In experience, I mean, the college experience- not work experience, ha!
I appreciate my college degrees, but most of what helps me now in this economy is what I taught myself or chose to learn outside the classroom!
I think a lot of things have changed over the years. I think I have to be much more flexible and adaptable. Good credit and savings gives me a lot choices.
Education can definitely be a great personal investment. We kept putting off buying a house for years, and it’s a good thing. We’re not even sure what country we will end up living in right now, I wouldn’t want to be tied down with a house.
Education can be formal or informal! Keeping learning new skills, it makes you more valuable.
I wouldn’t say the American Dream is dead but it sure does look different! It’s nothing like what it was 10-20 years ago, but I think that will begin to change when we begin to change. That means accepting a different way to do things, much as you spelled out (renting, community college, etc).
What has definately changed is that the dream no longer resembles an elevator, but more of a gauntlet! That means we have to be more directed and more relentless. The post World War 2 economy is over and we’re looking at something very different, something that looks more the way it did before WW2. We have to work harder, save more, stay out of debt and accept longer time horizons on our goals. We can get there, but it will take longer. That means a different mindset and a whole bunch of different tactics. I think we can do it if we embrace it rather than be repulsed by it.
Very true! A long time ago when I graduated college, you normally would be set for life by the time you reached forty. I decided not to wait and developed my own plan for financial freedom which I achieved at 38 years old. I think my mindset is more appropriate now versus 26 years ago.
I agree that education can often help people accomplish their dreams, but it needs to be part of an overall plan. Now, education needs to be bolstered with experience in the field, often through internships, to make the education pay off. The combination of education, field experience and networking can put some candidates way ahead of others.
Education is just the start, it gets you inside the door. What you do with your education, experience and connections (network) is very important.
I don’t know that it’s dead. It’s just different. And I think it’s hard to have a one size fits all American dream. Every person is different and wants different things. I think we need to decide what our American dream rather than just buying into a generic concept.
I think this is always true! I achieved my dream of financial independence when I was 38 years old. Although I had a college degree, my dream of entrepreneurship allowed me to succeed. For the last 26 years, it gave me choices.
Yes it certainly has changed–and probably for the better. Prosperity has meant acquiring things in our culture, and look at where that has led us! Not only are the prosperous purchasing too much, but those who want to emulate them are replicating the behavior. Now most Americans are in debt. Not a good dream to have!
Right now, everyone is being a little frugal, but I think it will change as soon as more people are employed and the economy improves. Homes are definitely more affordable, but you need good credit and a down payment. Opportunity is knocking, you have to be in a position to take advantage of it.