Financial experts say the American Dream is dead… and they reveal who’s to blame

For years, the American Dream meant owning a home, building wealth and leaving a better life for your children. 

But with soaring house prices, crushing student loan debt and costly everyday expenses eating away at Gen Z and millennial paychecks, financial experts warn that the American Dream is already ‘dead’ for millions of young workers – at least in the traditional sense. 

According to the 2026 report from the Harvard Joint Center for Housing Studies, the average monthly cost of owning a median-priced American home hovers around $3,200 per month, near a historic high. 

Since 2020, home prices have risen by roughly 54 percent nationwide, according to the same report. Meanwhile, home sales have fallen to roughly three-decade lows, as many hopeful buyers find themselves completely priced out of the market.

The affordability gap has become so severe that more than 75 percent of homes on the market are unaffordable for the typical American household, according to last year’s Bankrate analysis. 

While some point fingers at older generations for hoarding real estate, mortgage broker owner Taylor Tassone clarified that one generation being ‘to blame’ is ‘usually too simplistic.’ 

The housing challenges facing Gen Z, he theorized, are partially because of low supply, rising education costs and regulatory constraints on new construction.

‘Many young adults are working hard and making responsible financial decisions, yet still finding that traditional milestones like buying a home, building wealth and achieving financial independence take longer than they did for their parents or grandparents,’ Tassone told the Daily Mail.

Meanwhile, higher education costs for both public and private colleges have essentially doubled over the last 30 years after adjusting for inflation.

Because of high tuition costs, Americans owe between $1.7 trillion and $1.9 trillion in student loan debt, making it the second-largest category of consumer debt after mortgages. Federal student loans alone account for roughly $1.69 trillion owed by more than 42 million borrowers.

Debt management expert Michael McAuliffe said that Gen Z consumers have ‘rapidly’ become one of his company’s fastest-growing client segments, with an increase of over 160 percent from 2021 to 2025.

McAuliffe’s nonprofit Family Credit Management helps Americans navigate debt, build credit and find financial stability. For their Gen Z clients, the average debt at the time of seeking counseling has nearly tripled in that same time period – from $5,266 to $14,559. 

This is expected by the nonprofit to an extent, as these consumers are aging into credit use and beginning to support themselves financially. Family Credit Management also confirms seeing clients become credit-dependent at earlier ages than previous generations.

‘The American Dream hasn’t necessarily disappeared for Gen Z,’ McAuliffe said, ‘but it’s definitely been pushed so far into the future, it can feel like it’s barely worth trying for.’

He added that when talking to young adults about long-term goals, ‘they aren’t focused on buying a home,’ not because they don’t want one, but because ‘they’ve done the math and concluded it’s just out of reach for them.’

Even everyday purchases, from fast food burgers to movie theater tickets, feel like splurges as the cost of living soars nationwide – especially in coveted coastal areas like New York and San Francisco. 

As a result, some younger Americans feel as though financial independence, in the traditional sense, is firmly out of reach. Haley Sacks, also known as Mrs Dow Jones, affirmed that the American Dream ‘is dead’ – but she doesn’t necessarily think that’s a bad thing. 

For decades, the American Dream followed a pretty specific script – buy a house, work for one company for 30 years, retire with a pension and hope your kids do a little better than you did. 

‘That model doesn’t reflect how most people live anymore,’ Sacks told the Daily Mail. ‘Careers are less linear. Families look different. People move more. Many young Americans value flexibility and fulfillment as much as they value stability.’ 

What’s replaced the American Dream instead is something else entirely, which she called ‘optionality.’ 

‘To me, success in 2026 isn’t about owning a particular asset or hitting a specific milestone by a certain age,’ Sacks said. ‘It’s about having choices.’

Whether that’s leaving a bad job, taking time off to raise a child or starting a business, the new American Dream is about having the freedom to ‘design a life that actually works for you.’ 

‘Wealth today isn’t just about what you own,’ she added. ‘It’s about the choices available to you.’

Sacks goes into detail about that ‘learned financial helplessness’ in her book Future Rich Person, and helps Americans learn more about building wealth with her social media platform.

Sacks also added that with the added advantage of social media, younger generations are ‘more open’ about money than previous generations, whether that be discussing salaries or teaching one another how to invest.

Financial advisor Ray Prospero is seeing a similar trend even within his home – just recently, three of his children asked him about investing in stocks and crypto.

‘Thanks to social media platforms like TikTok, YouTube, and the unprecedented access to financial information online, they’re learning about investing at a younger age and starting sooner than ever before,’ Prospero told the Daily Mail.

Northwestern Mutual reports that Gen Z workers with financial advisors start working with them at an average age of 23 – that’s more than two decades earlier than baby boomers. Roth IRAs now make up a significant portion of their retirement savings.

And what’s amazing, Sacks said, is that they’re doing this ‘despite facing enormous financial headwinds.’

The generation everyone jokes about for buying avocado toast is quietly doing something very smart: they’re investing earlier, talking about money more openly and taking ownership of their financial future,’ she added.