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The cost of the American dream is rising at a faster pace than household earnings, driven by notable increases in the cost of homeownership, raising children and paying for college, according to a new report.
An analysis by Investopedia finds that the lifetime cost of the American dream rose 4.1% from 2025 to 2026, with the cost increasing by more than $208,000 from $5.11 million a year ago to $5.32 million this year.
That cost has risen faster than wages and salaries, as the Bureau of Labor Statistics data for private sector wages and salaries in the past 12 months through June increased 3.1%.
Investopedia’s analysis of Census Bureau data found a full-time worker with a bachelor’s degree earns about $3.6 million from age 25 to 64 without accounting for income taxes, while 20 years of the average Social Security benefit increases that total to about $4.1 million – about $1.2 million short of the American dream’s cost.
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Homeownership costs rose the most in dollar terms, with the lifetime cost rising by over $91,000 from $1.184 million in 2025 to $1.275 million in 2026. That rise amounts to a 7.7% increase year over year.
That figure includes a 20% down payment on a median-priced single-family home of $420,000, with a 6.32% 30-year mortgage that brings the total cost with interest to about $837,000, as well as $3,057 a year in insurance costs and property taxes, and 30 years of upkeep and utilities which adds another $438,000 to the price tag.
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The cost of raising children and paying for college saw the fastest increase year over year, rising 8.9% from $876,092 in 2025 to $953,763, Investopedia found.
Other components of the American dream included in the analysis rose at a more modest pace – the lifetime costs of taking a yearly vacation and owning pets each rose 3.5%, to $186,999 and $40,772, respectively.
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Lifetime retirement costs rose 2.2% to $1,205,119 based on the estimated spending of a retired married couple over 20 years. The cost of a wedding increased by 1.6% to $38,800.
The cost of buying two new cars for the household, and covering costs for insurance, maintenance, registration and fuel rose 0.5% to $1,205,627 in lifetime costs.
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Healthcare costs were the only category of the American dream analysis that saw lifetime expenses decrease compared with a year ago, albeit by just 0.2% to $413,271.
