Are we witnessing the death of the American dream?
Sort of, if a recent report is any indication.
The latest research from American Financial Benefits Center (AFBC) discovered seven in 10 U.S. adults believe the American dream is “alive and well,” but far fewer have faith in their ability to achieve it.
Outstanding balances on student loans are largely to blame, AFBC contests. On average, one in five Americans over age 18 is indebted more than $34,000 as a result of pursuing higher education.
This “$1.52 trillion of debt owed by 44.2 million people is weighing down the confidence of many individuals,” the report noted.
But the fact is student loans are only part of the problem. AFBC identified several other common sources of financial pressure that Americans are facing today, such as:
- An overwhelming lack of savings. More than two-thirds of adults are not confident they’re saving enough to secure a successful retirement. Three in 10 haven’t even saved enough to cover a month’s worth of expenses.
- Mounting credit card debt. Approximately six in 10 adults say they have an outstanding credit card balance of around $10,400.
- Costs related to caring for an elder. Many respondents expressed concern “about their ability to pay for the care of a loved one, usually a parent, in-law or spouse, as they became elderly. This care, estimated at roughly $7,000 per year, is nearly 20 percent of average annual income,” AFBC noted in its report.
The findings echo a recent MassMutual study that revealed over half of Americans (52 percent) admit they are not optimistic about achieving the American dream, which was defined as owning a home and achieving financial security.
“It is really unfortunate that people are becoming less confident that they can achieve financial security,” Sara Molina, manager of AFBC, said in a statement. “As our clients know, we are able to help them in their effort to get some breathing room by assisting them in understanding and applying for certain federal repayment programs after navigating the sometimes complex student loan repayment process. Such programs may possibly lower their monthly payment so they can gain some control of their financial lives.”
We say Americans should concentrate equally as much on building up their 401k.