In what won’t feel like news to many Americans, a new report underscores that the affordability crisis is real—and getting worse.
It costs 4.1% more this year to achieve the eight hallmark life milestones that make up the prototypical American Dream, according to a report released Wednesday by Investopedia. Over the course of a lifetime, a household will now spend about $5.3 million to own a home, buy new cars, raise two kids and send them off to college, retire, pay for healthcare, throw a wedding, own pets and take an annual vacation, an analysis by the financial content site found.
While the costs associated with these sorts of life milestones differ from the day-to-day living costs reflected by monthly inflation reports, it shows that the American Dream is slipping further out of reach for many Americans. The latest figures from the Bureau of Labor Statistics show that private-sector wages and salaries rose 3.1% in the 12 months through June, though a more recent report from ADP shows that gross pay for private-sector workers rose 4.7% in September from a year ago.
Whether or not Americans’ paychecks are actually keeping pace with the cost of chasing the American Dream likely matters less than perceptions. A survey conducted by CNBC and SurveyMonkey in May found that 51% of U.S. adults feel that the American Dream is out of reach for most people now, while 26% of respondents in a Gallup poll conducted earlier this year said that the American Dream has failed entirely.
Investopedia didn’t immediately respond to a request for comment about the report from Fast Company.
President Donald Trump, for his part, still believes the American Dream is possible and invokes it frequently in speeches. But the Investopedia report underscores why so many Americans disagree—and why the affordability crisis has taken center stage in the U.S. midterm elections, which take place in less than four weeks.
WHAT MAKES UP THE AMERICAN DREAM
Not surprisingly, surging housing prices are one of the main reasons why the cost of the American Dream has become more expensive. In fact, Investopedia found that owning and maintaining a home has overtaken cars as the biggest lifetime expense for most Americans.
Over the course of a lifetime, a household will now spend nearly $1.28 million to buy and maintain a home, up 7.7% from the 2025 estimate. The Investopedia team estimated the cost of home ownership based on the mortgage required to buy a $420,000 median priced single-family home, in addition to property taxes, insurance, utilities, and general upkeep.
But where Americans are particularly feeling the pinch of achieving the American Dream is related to their decision to have kids. It now costs about $700,000 to raise two children from birth through the age of 17, up 9.5% from 2025, which was the largest increase of any of the costs associated with achieving the American Dream. Tack on childcare and the cost to send two kids to an in-state public university, and the team estimates the total price tag of parenthood to be more than $950,000, up nearly 9% from 2025.
Perhaps surprisingly, only one category of lifetime expenses has actually gone down in the past year: healthcare. The report found that spending on healthcare costs from the age of 22 to 85 has edged down slightly, by 0.2%.
That said, some costs are more discretionary than others. The team estimates the lifetime cost of buying and maintaining two new cars, whereas the vast majority of Americans drive used vehicles. And the $5.3 million price tag for the American Dream includes the average cost of a wedding, though that can certainly vary, as can costs associated with how many pets to own or the sorts of vacations to take each year.
The eight categories of costs that make up the American Dream as of 2026 are:
- Homeownership: $1,275,782, up 7.7% from 2025
- New cars: $1,205,627, up 0.5% from 2025
- Retirement: $1,205,119, up 2.2% from 2025
- Raising kids, paying for college: $953,763, up 8.9% from 2025
- Healthcare: $413,271, down 0.2% from 2025
- Yearly vacation: $186,999, up 3.5% from 2025
- Pets: $40,772, up 3.5% from 2025
- Wedding: $38,800, up 1.6% from 2025
Finally, aside from a mortgage or a car loan, the team didn’t factor in another cost that’s inherent to day-to-day life for many Americans: the cost of being in debt. As of the second quarter, total U.S. credit card balances rose 1.7% to $1.26 trillion and the Federal Reserve Bank of New York noted an “elevated” level of Americans who have become newly delinquent on their debt payments.
