Living the American Dream is possible, but it comes with a hefty price tag.
According to a report by financial media site Investopedia, the cost of achieving the quintessential American aspirations—owning a home, driving new cars, raising children, and enjoying annual vacations—adds up to an estimated $4.4 million over a lifetime.
Here’s how it breaks down, with the calculations explained below:
- Retirement: $1.6 million
- Homeownership: $930,000
- Raising two kids: $832,000
- Owning new cars: $811,000
- Annual vacations: $179,000
- Wedding: $44,000
- Pets: $37,000
- Funeral: $8,000
Investopedia has analyzed the costs of the American Dream before, largely due to popular demand.
“We began this analysis because ‘the American Dream’ was one of the most-searched phrases on our site,” said Caleb Silver, editor-in-chief of Investopedia.
An earlier report, released in 2023, estimated the cost at $3.4 million. However, Silver advises not to compare it directly with the updated version.
Of course, most people don’t have $4.4 million readily available. In fact, the median net worth for the top 10% of U.S. households is about $3.8 million, according to the 2022 Federal Survey of Consumer Finances.
But achieving the American Dream is the work of a lifetime. Investopedia reports that the average American with a bachelor’s degree earns about $2.8 million over the course of a career. Add in a second household income, and $4.4 million becomes more attainable.
Perhaps the report will inspire some to partner up. More importantly, it should motivate readers to save and invest, according to financial advisers.
“The key takeaway is the need for a well-thought-out financial plan,” said Niv Persaud, a certified financial planner in Atlanta. “The downside is that these numbers might overwhelm and discourage people.”
The $1.6 million retirement savings figure may seem especially daunting, as few households come close to that amount.
However, some components of the American Dream might not be as costly as they appear. Take homeownership, for instance. While you might pay nearly $1 million over 30 years to cover your mortgage, “you could end up with an asset worth that much,” explained Laura Mattia, a certified financial planner in Sarasota, Florida.
Here's a closer look at the math behind Investopedia’s report. While it may seem like a staggering sum—more than many Americans earn in a lifetime—advisers say that the American Dream is still within reach for households with dual incomes and solid saving habits.
The concept of the American Dream has been front and center lately. At the Republican National Convention this summer, Donald Trump vowed to "restore the American Dream." Both JD Vance and Kamala Harris referenced it multiple times in debates.
For its September report, Investopedia sought to calculate the lifetime costs of the classic American goals: homeownership, parenthood, a big wedding, new cars, vacations, and pets, all topped off with a secure retirement and a dignified funeral.
