According to a recent survey conducted by Bankrate.com, a personal finance website, Americans have registered feelings of financial security at the highest level in the past four years. This flies in the face of the fact that the median household income in the United States has declined. In fact, the median household income is at the same level as it was in 2007. This is almost unimaginable, because the definition of the American Dream is for each generation to enjoy a higher standard of living than the previous generation. Apparently, the United States, in terms of economic mobility and income generating ability, is taking several steps backward.
What explains the increased feeling of financial security reported by Bankrate.com? A lot of this has to do with the millennial generation. The millennial generation is exhibiting certain demographic patterns that are quite different from previous generational cohorts. Unlike Generation X or the Baby Boomer generation, millenials don’t necessarily subscribe to the idea of the American dream as traditionally defined.
The American dream has historically been defined as home ownership and an increasing standard of living. The millennial generation, on the other hand, is more than happy to live in micro-houses, or avoid owning a house outright. In fact, they are more than happy to rent. A lot of the demographic patterns present in this generational cohort seem to subvert the American dream as classically defined.
A key part of this is that people have re-evaluated how they define the American dream. It used to be that the American definition of success is that you died in a house that is much bigger than the house that you first bought. The whole mantra used to be: bigger and better. According to observations made by the Director of the Economic Mobility Project at the PEW charitable trust, people are redefining what security and stability mean.
It used to be that Americans would define security as being wealthy or rich. That is no longer the case. Americans are focusing primarily on stability, rather than living large. This is great news, considering the fact that the jobs recovery in the United States is actually quite uneven. A lot of the recovery and employment roles actually take the form of lower-paying jobs. This explains why the median household income has eroded over the years instead of increasing like it normally did during the post-World War II period. It appears that the typical American’s perception of the good life is quickly aligning with the economic reality on the ground.