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Most U.S. families have been priced out of the American Dream, according to an analysis by Investopedia.
The traditional standards of basic middle class life in America costs $3.4 million dollars over a person’s lifetime, the finance news website found. The average lifetime earnings of a U.S. worker was estimated to be about $2.3 million, more than million dollar short of that ideal.
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The median household income in the U.S. is $74,580, according to the latest Census Bureau data.
The analysis, which took into account factors such as getting married, buying a home, raising two children and owning a pet, concluded that the typical features attributed to the American dream cost a staggering $3,455,305 in total.
While some of the expenses included in the analysis are shared in a dual-income households, the study helps highlight the lack of stability for middle class families bearing the rising cost of food, tuition and living expenses due to higher inflation and interest rates.
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The average cost of raising two children is about $576,896, the analysis found. This includes a year of in-state college tuition for both kids, including room and board, which cost about $42,070. However, the estimate may be higher if the child stays home past adulthood, and parents help pay for higher education fees beyond just the first year.
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When it comes to home ownership, Investopedia found that the average mortgage in the U.S. cost nearly $800,000, assuming a 10 per cent down payment and a 30-year fixed loan with 7.2 percent interest (not including taxes and lending fees).
Meanwhile, the cost of a wedding and engagement ring was $35,800 on average, the analysis found, citing the wedding planning website The Knot.
“If your family includes a furry friend, you could be looking at up to $67k in lifetime costs for a dog and cat that each live for 15 years,” Investopedia adds.
The final price is based on a sum total of 10 lifetime expenses. Some of these expenses would vary depending on the family’s values and needs. The figure also includes:
— Cars (used): $271,330
— Health Insurance: $934,752
— Retirement: $715,968
— Funeral: $7,848
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