Why Try If The American Dream Is Dead?

Andrew at LivingRichCheaply had an excellent post that asked if America is still the land of opportunity, while Bridget at MoneyAfterGraduation had a counter point that the dream is dead and why you’ll never get rich.  Income inequality is growing and many Americans are still struggling despite a recession that ended five years ago.

I was born into a well to do family in Vietnam, we had one of the largest houses in the neighborhood with a full staff servicing our needs.  When the communists came during the war they seized a lot of my family’s assets.  We escaped when I was three by boat in the middle of the night.  We waited at a beach, my parents were afraid that the smugglers were going to sell us out to the communists.  If we had gotten caught there were education labor camps for the adults and reeducation schools for the children.  Since I was only 3 I don’t remember this and I first heard this story around 7.  On the boat with several hundred other people out at sea there was also the threat of pirates.  Since I was a kid my mom made the pirates sound like Jack Sparrow, they would come on board take a few things then leave.  In reality they were the Captain Phillips type of pirates who were far more dangerous.

My father struggled with going from being wealthy to finding work as a gardener and later a janitor. (He eventually became a teacher).  He drank and partied with his friends and worked only when he wanted to, the same lifestyle he had in Vietnam.  My sister and I was raised by a single mother which is the biggest indicator of poverty.  

When I went on field trips most of the kids would buy lunch, I would bring home lunch because we couldn’t afford to buy lunch for $5. You know you’re poor when other poor kids make fun of you for bringing home lunch.  In Bridget’s article she points out that 48% of people born into the bottom 20% stay there, however that neglects that the majority of people in the 20% improve their lives.

I returned  to Vietnam for the first time 13 years ago where I met up with family members.  A few of my relatives were middle class (one is a lawyer, another a shop owner) yet their standard of living was lower than growing up poor in America.  If you made $200 a month you were doing well.  I’ve never seen poverty until I returned to Vietnam. A cousin whose family wasn’t doing so well had cried that he wish he had the courage to come to America when he had a chance.   My father had sponsored him to come to Hawaii, however he turned it down because he was afraid of starting over in a new country. I’m grateful my parents had the means and courage to leave which changed the course of my life.

Income inequality is widening in America.
The widening of the wealth gap coincides directly with the rise of the stock market and real estate values. Growth in the rich’s net worth is not by income but by asset values.  The wealthy invests in stocks, bonds, and investments, while the poor invests in electronics, cars and phones. There is no rich people sitting around plotting to keep you poor, the only person holding you back is you. What the wealthy is doing is employing lobbyists to minimize their taxes based on their income level. Majority of the growth in my net worth was due to investments and not income.

The American Dream isn’t dead, it’s changed.  Hard work and determination isn’t enough to bring you financial independence. The world is full of hard working poor people, ask anyone who’s ever worked at a minimum wage job full time.  Follow these six rules to build your wealth towards financial independence.  You also need soft skills to get ahead by communicating to your bosses the quality of your work.   Network and foster relationships so that people like you at work.  People want to work with others that they like, this is especially true when it comes to promotions.   This is why top business executives have similar backgrounds and personalities.

When I recruit I can always tell if someone is from an upper middle class household based on their social skills and the college they attend.  There will always be others with more than you, it doesn’t matter as the internet has become the great equalizer.  All the knowledge and skills needed to get ahead is a Google search away.  20 years ago I would never have a voice, today a Starbucks internet connection and foregoing a $5 value meal and you’re reading my blog. Anyone can start a business from their home or start freelancing and communicate immediately to millions of people.

I’m not blind that there are very real problems in America, being born in America or anywhere in the developed world you’ve already hit the genetic jackpot.  It’s up to you what you want to do with that ticket.  Tell Sam who retired at 36, Joe at 40, or Jason who is on the road to early financial independence that the American Dream is dead.

Is the American Dream dead or changed? What are you doing to achieve it?

 

Comments

  1. I would never say the american dream is dead. It’s cynical and pessimistic. It’s like saying happiness is not achievable. I think the whole corporate ladder concept is kind of dead, meaning you don’t start off at the bottom of one job and climb your way to the top and retire rich. But entrepreneurial spirt has definitely risen.
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  2. Your story is interesting – but you need to edit your posts, as your grammar errors are very distracting.

  3. I think you hit the nail on the head. The American dream has changed because information that was passed down through wealthy families is now available to all via the internet. As you pointed out soft & interpersonal skills are VERY valuable today. I personally would rather work with someone who I feel I can get along with and train versus someone I can’t stand.
    Marvin recently posted…Quality Used CarsMy Profile

  4. You’re looking at it from an immigrant perspective as well, so that has to be kept in mind.

    For me the (North) American dream is not dead, it’s more that I see kids and people in general who don’t even meet the basic level of hard work and determination, and then on top of that, you need to also not be knowledgeable but know how to apply it.

    From my experience and observing the attitudes of those around me, people who have grown up with a sense of scarcity and have had things denied to them because of poverty and so on, tend to be more hard working, although as you mentioned, it is not enough for them to just work hard as it is to work smart.
    save. spend. splurge. recently posted…Second Trimester Trials and Tribulations: How my pregnancy is going so farMy Profile

    • The schools don’t teach the basic stuff especially the soft skills. I had to learn at my jobs and in college how to shake hands, look at people in the eye, and communicate what I want. It’s amazing how many people lack these basic social cues.
      After working at really low paying jobs I never bitch at how much work I have to do.
      Charles recently posted…Six Rules On How To Become A MillionaireMy Profile

      • Just remembering a article I read that many young employees today think that things like hours they are expected to be at work is optional and they can take off any time the surf is up. They expect constant praise and feedback from supervisors and can’t work independently because they are so accustomed to working in group settings in school. And then you have the helicopter parents who want to attend interviews with their kid and protest evaluations they feel aren’t fair. And during the interview, they are constantly texting. Who wants an employee like that? Even if schools don’t teach that…which they didn’t when I was at that stage of my career either…why on earth wouldn’t the parents tell their kid how things are in the real world of employment.

  5. I think that the problem is that those who start out in the bottom 20% don’t have a lot of exposure to the top 1% financial behaviors. And they certainly don’t teach it in schools.
    Stefanie @ The Broke and Beautiful Life recently posted…I Suck at EbayMy Profile

  6. I love this post, Charles. In particular this line: “The American Dream isn’t dead, it’s changed.” That’s Tweetable! When people spend more time looking in the rearview mirror than they do paying attention to the road ahead, disaster will strike and it will always be someone else’s fault.

    I agree with you. There is so much amazing information available for free that anyone with any desire and commitment can achieve anything. Is it easy? HELL NO. I’m still trying to figure out how to earn an income through my blog in a way that feels ethical and generous to me. It is hard, but there are people out there doing it and taking action is the key.

    Blaming the supposed “gap” on the wealthy is simply ridiculous in my opinion. And more importantly, it’s dangerous.
    Ree Klein recently posted…Vanguard, Will You Be My Valentine? (Shhhh, don’t tell my Mr.!)My Profile

    • It’s amazing how we rightfully celebrate people who get out of debt and improve their finances but vilify others who are deemed “too successful” The worse are in SF who blames techies for them being poor and raising the cost of living. They neglect ridiculous NIMBY policies and the fact that neighborhoods are being cleaned up, thus raising property values.
      Charles recently posted…The True Purpose Of MoneyMy Profile

  7. I would say that the American dream is alive but like others have said, it’s changed. I think it is really hard for people who know absolutely nothing about investing to start…simply because maybe they don’t even know they are supposed to be investing.
    Liz recently posted…The Junk Food Tax (Yes, I’m paying it!)My Profile

  8. I want to be like Joe when I grow up!

    It’s interesting to see how society evolves over time. I wonder if we have the guys to go out and make the big changes that are needed.

    In the end, I think everyone of us is fortunate to be where we are. Go USA!
    Financial Samurai recently posted…What Your Car Says About Your Investing Style And Money Making AcumenMy Profile

  9. I really liked reading this article, even though I’m not living in the US and don’t plan to move there. But there are some generic truths in your article and I particularly loved this: “The wealthy invests in stocks, bonds, and investments, while the poor invests in electronics, cars and phones.” That’s the best way to pain the picture and an universal truth, no matter where you are. This is where changes must be made.
    C. the Romanian recently posted…How to Pay Off Your Student Loan Faster than the Rest?My Profile

    • There is an investment term that says “if you want to get rich sell to the poor”. The most profitable companies are beer, tobacco, gambling and consumer products. It’s been true since the beginning of capitalism as it appeals to our short term material item feel good nature.
      Charles recently posted…How We Reached A Million Before 40My Profile

  10. “There is no rich people sitting around plotting to keep you poor, the only person holding you back is you.” Charles, you are right on the mark here. As you know, I also grew up in the bottom 20 %. I never spent a day in college, and had no wealthy people to emulate in my circle of family and friends. What I did have, however, were books and the local FREE library. I started with The Wealthy Barber and The Millionaire Next Door. I didn’t know anything, but I knew I didn’t want to be poor. Now, in spite of decades of following our ancestors’ paths of making decisions that keep people poor, we have a plan in place that will make us millionaires in less than 10 short years, despite the fact that my husband makes well under 100k a year. I’m not saying this to brag, just to prove that it can be done.
    Laurie @thefrugalfarmer recently posted…Don’t Let the Success of Others Keep You From Achieving Your GoalsMy Profile

  11. I think the dream is still attainable but the road to get there is different. People no longer work for one company for 40 years then retire rich. You have to find your own way, and thankfully the internet helps many people do that.
    Holly@ClubThrifty recently posted…How Snowpocalypse Cost Us Almost $1,500My Profile

  12. Incredible story about you and your family’s experiences in Vietnam. I think, as you indicated, the American Dream isn’t dead but it is changing. You have to work smart, not hard (actually both ideally) to achieve the American Dream. You can still work your way up from the bottom at any company, but people who work smart can leapfrog others and potentially create “smarter” income streams that will allow for passive income over time. Hard work will always be needed, but working “smart” is what will put people ahead.
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  13. 1. You properly point out that one of the biggest causes of poverty is out of wedlock childbirth. This has become more and more accepted with no stigma so of course single parent households aren’t going to have equal income to those with two earners.
    2. As an immigrant, you came to America without the welfare mentality that too many people have in this country. It is expected that the government will take care of them.
    3. The American dream is not dead, but the willingness to work for it is dying.
    4. People who are willing to work and make some sacrifices can and have achieved the dream……I know I did.

  14. I find this interesting. I tend to fall in the middle of the argument. I tend to think that hard work is very important but there is something to be said about sheer luck that a lot of people don’t want to admit. Many people are born with lots of connections. Its means those who don’t have that must work a lot harder to get to success.
    Debt and the Girl recently posted…Could You Survive on $4 an Hour?My Profile

    • That’s why the rich will pay upwards of 25K for schooling so that their kids can make the right connections. It is who you know, but no government program will give you the connections.
      The more successful people get the “luckier” they are as their confidence and network grows. People want to do business with successful people they like.
      Charles recently posted…The Three Financial Moves You Need To Protect Your FamilyMy Profile

      • You are right about this Charles – the wealthy have the advantage to buy the schooling and connections that are so important. That’s the problem I see, I feel there is a real barrier to entry to the upper class when you are born on the bottom rung. That being said, I still believe in the American Dream and I know that in this country it is possible to rise to the highest level even if you start at the absolute bottom. But I do believe it is more difficult now than it was in the past. I absolutely agree with your points about the knowledge being available (on the internet, etc.) to those who seek it and that many poor people spend too much money on junk which continues to hold them back financially (my family members among them).

        Great post and I really enjoyed hearing about your early life in Vietnam. Thanks for sharing.
        Kay @ Green Money Stream recently posted…A Fool and Her Money?My Profile

        • A lot of my family wastes their money on so much useless crap that does nothing for them. If I had the means I would spend whatever it takes to give my children all the advantages in life so I don’t fault them.

  15. The American Dream is still alive and well, the problem lies in that there’s too many people that want the American Dream without working for it. The poor in the US, for the most part, still have water, electricity, tv, cars, a/c, heat, a meal every day…that’s not poor on a global scale. I do believe part of the issue is that the bottom 20% just aren’t exposed to how you can achieve the American Dream or any basic personal finance concepts. One thing I’ve thought of doing once reaching FI is to either try and be a economics teacher in school or to start some kind of seminar for graduating high school seniors to give them basic PF ideas. All of the math is simple and something you learn through your middle school years.
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    • Problem is compound interest seems so boring and retirement so far away. I was a finance graduate and pissed my money away being YOLO. If you can influence a few kids early on then they can influence their friends.
      Charles recently posted…Why Do You Choose Material Items Over Your Loved Ones?My Profile

    • I’ve thought about doing the same once I reach early FI… It’s crazy to think back, but when I was in High School, my economics teacher made us read Rich Dad, Poor Dad. Although most of it was in one ear out the other, it did have a profound impact on the way I thought about money… Around the same time, I was bagging groceries for probably minimum wage, working at a commissary. My senior year, when I read the book, is when I really started to first think about saving money and having it grow…
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  16. Fantastic stuff, Charles. Your family’s story is incredible, and illustrates the lengths immigrants often go to in order to find a better life here in America. My mother’s story of coming to the states didn’t involve escape, but I’m equally grateful that she had the guts to come to the Bay Area back in the 1970′s. My life would been very different in the Philippines than it was growing up in Pittsburgh.

    As you said: the main driver of wealth is the decision (or ability) to put your money into assets, rather than expenses.

    Great meeting you, too. I’m going to put some of those ideas into action in 2014.
    Done by Forty recently posted…Limit Your Options, Expand Your WalletMy Profile

  17. Charles,

    Couldn’t agree more with what you wrote in this post. The American Dream isn’t dead. People who keep saying this aren’t capable of “envisioning” new ways to achieve this dream.

    It is definitely harder to accomplish the dream. But remember, hard work isn’t everything. Hard work paired with smart work is the new key to the American Dream.

    Thanks for the post.

    Keep up the good work here at your website!

    - Samuel
    Samuel recently posted…Jon Acuff: The New York Times Bestselling Author on Internet DreamsMy Profile

    • Hey Samuel,
      Thanks for stopping by, the world is full of hard working poor people. Companies demand efficiencies in your work, your finances and career snhould be that way also.

  18. Quite a moving story about your family’s escape from Vietnam. I’m glad you and they made it out.

    I agree with you that, “The American Dream isn’t dead, it’s changed.” Most people will not be able to meet their dream by work alone, especially workers at the lower end of the spectrum. They have to do more than just work hard.
    Bryce @ Save and Conquer recently posted…Invest for at Least 20 YearsMy Profile

  19. Thanks for sharing more of your story. That’s amazing that you had to escape communism by boat. Those of us born in the US do truly take it for granted. I certainly don’t have any sort of experience like that but I do credit my paternal grandfather for setting our family up to be educated. Before him, everyone was a farmer or laborer, which could support a family back in the day, but not so much now. He made the decision to move his family with two small boys into the “city” to go to dental school,which was unheard of at the time. My Dad then went to college, and my sister and I never thought there would have been another option. I wish he were still around so I could ask about his motivation and how he pulled that off!
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    • My wife and I are working hard so that our children can have all the things we never had. We want to do for future generations what your grandfather did for your family.

  20. Of course it is still worth trying, it is just that realizing the dream is a lot less commonplace in America than it is in other countries these days. – http://en.wikipedia.org/wiki/List_of_countries_by_income_equality

    Great story by the way and provocative article. I thought you balanced both sides nicely.

  21. For me something changes for american dream. Everyone wants to have better life not just for them but for their future kids also. Things just change even ideology of mankind. Only fools don’t change their minds.

  22. Excellent post Charles and it’s always fascinating to learn about someone’s background to see how that shapes their perspective. I definitely agree with you that the American Dream is not dead but that it has changed. We just have to adapt to the new reality. I’m curious since you work as a recruiter as to what specific social skills that those in the upper class have (might be a good post). As for colleges, I’m also very curious as to whether a prestigious college name matters. If I were an employer, I think I might prefer someone who pulled themselves up by the bootstraps, worked while going to state college, rather than someone who had mom and dad pay for their ivy league education. Not always true, but that’s just a thought.
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    • Andrew,
      Mannerisms and use of language you can tell the level of education. You want a prestigous school becuase these are the elite students. A lot of tim they often feel privileged and don’t appreciate.

      • Right, they are privileged and don’t appreciate it. That’s too bad employers aren’t as likely to give some other students who may be “elite” as well as hard working but didn’t go to the prestigious name schools.

  23. Steven Lau says:

    Charles,
    Thanks for this great narrative, I’m always interested in how people grow up and how that shapes them

  24. I definitely don’t think the dream is dead- like you said, it’s simply changed. It takes different skills and ingenuity than it did 50 years ago. Just as 50 years ago it was different than 100 years ago. In a constantly evolving society, the way to a prosperous life shouldn’t be expected to remain necessarily static. I enjoy reading about your background, by the way. It’s very inspiring to see how amazingly well you’ve done coming from humble beginnings.
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  25. I don’t think the American Dream is dead. I moved to Omaha, Ne from Scottsdale because of the thriving economy. Unemployment in NE tends to bounce between 3-4% while the national unemployment percentage bounces from 6-7% or higher.

    Since I moved to Omaha, Ne I’ve never been without a job unless I chose to quit. You can always find a job here, the cost of living is affordable, and people are generally optimistic and friendly. People in general don’t think much of Omaha, Ne but it’s a great place to be if you want financial stability and the American Dream.

    We may not have the “glamour” of NYC, Seattle, or Miami but Omaha, Ne is a special city in its own right. There are many hospitals and private clinics, financial & insurance services, and IT is a strong field here. I feel like more people should move here because there are many opportunities for jobs here.

    You can go to the state university and as long as you have a pragmatic degree and skills to bring to the table then you can make a good living here.

    Nobody really cares if you went to an elite college or not, they just care that you have one for the most part and that you are smart, talented, honest, reliable, and that you can work well with others.

    Even if you don’t have a degree but you have good skills to bring to the table then people are willing to give you a chance, such as in the IT field. Of course IT is a unique field in that way since you’re not dealing with peoples finances, legal issues, and health care issues.

    For example my bf, his brother, and a few of his friends grew up learning how to program during their free time. And guess what? They have careers as software developers, software engineers and programmers without going to college.

    One of my bf’s friends got a degree in international studies from the University of Nebraska at Omaha however he learned coding skills on the side and now works as a software engineer.

    You can give up or you can keep trying. Giving up is easy. Anyone can give up. It’s living a full life that’s actually more challenging.

  26. Charles, very insightful and thought provoking article. It is so much harder to get ahead these days but I also agree the American dream is not dead. It is just harder to achieve. The key is a very strong work ethic combined with education and the quest for knowledge and expertise. These are the universal requirements for success in any country and any time.
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  27. Discussing the American dream almost seems pointless. Whether it is still alive or dead or even a myth doesn’t have much bearing on our lives as individuals. Is owning a business the American dream, going to college or perhaps buying a home? In each case you can argue it’s just a corporate and government machine that is feeding us their propaganda to enable s the be sucked into 30 years mortgages or student loans that will sit for 10 – 30 years after you finish college. Live well, below your means, travel, be with family, start a business, work for someone but don’t question the notion of an American dream
    DivHut recently posted…Moo… Agribusiness Dividend StocksMy Profile

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