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How Debt Is Killing the American Dream

Is the American Dream still alive? Well . . . it depends on what generation you ask. If you ask your grandparents, then yes. But what about for you and your family right now? The American Dream has morphed into a never-ending cycle of keeping up with the Joneses—full of cars, houses, degrees and vacations we can’t really afford.

Consumerism, discontentment and the endless pursuit of what we don’t have has contributed to killing the American Dream—one small swipe of the credit card at a time.

What Is the American Dream?

Ask 20 different people this question and you’ll get 20 different answers. You might hear something about a two-story home with a white picket fence, two kids and a dog. Or you might hear about having access to a great college education, building a thriving career in the corner office or even starting a family business from the ground up. All of these are great dreams. But the one dream everyone can get behind is living a good, full and successful life.

So, how does that really play out? Well, in our day and age, we sign up for student loans, take on crazy amounts of credit card debt, buy homes we can’t afford, work at jobs we hate, and seem to pay our allegiance to the almighty FICO score year after year . . . after year. Sure sounds like a dream doesn’t it? Nope. And you want to know the thread holding it all together? Debt. Yup—debt is dumb, and it’s killing the American Dream.

Debt Is Killing the American Dream

Did you know that 1 in 10 workers in our country who make over $100,000 are still living paycheck to paycheck?1 Debt is killing the American Dream. Just ask your barista—who works extra shifts each week to make ends meet. Ask the single mom—who worries endlessly about how she’s going to keep food in the fridge and the lights on this month. And you can even ask the high school student—who doesn’t think they’ll ever be able to afford college without student loans.

But how did we get here?

It started out innocent, right? Maybe when you were in high school, Mom and Dad gave you a credit card “for emergencies only” to help you build up your credit. But a few months into your new cardholder status, you realized that you held the term “emergency” a little too loosely. Yeah, those late-night pizza runs don’t seem as important when you’re paying triple just a few years later.

And what about cars, college degrees, expensive family vacations and even those ridiculously overpriced mom jeans you just bought to stay “on trend”? Let’s just say, you’ve discovered what’s killing the American Dream: your Discover card (and more debt than you know what to do with).

Since when did the American Dream involve piles of credit card bills, student loans and car payments? When did the American Dream turn into working so much you can’t see your family, owing more money than you make to Sallie Mae, and losing sleep over the mortgage payment? Has the American Dream become an illusion?

Redefining the American Dream

We want stuff we really can’t afford, and debt allows us to get it—and get it quickly. But in reality, debt is a trap. Debt gives the illusion that we’ve reached the American Dream . . . or at least kept up with the highlight reel on Instagram.

Listen: Your biggest wealth-building tool is your income, and when most of that income is paying for the past, it’s impossible to win with money right now.

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Pay off debt fast and save more money with Financial Peace University.

Redefining the American Dream means killing the American Dream of today. It means quitting debt, comparison, envy, keeping up with the Joneses, and chasing after things that don’t line up with your goals and dreams.  

But how?

By following the Baby Steps toward a life of living and giving like no one else. By living on less than you make. And by using your actual income as your greatest wealth-building tool.

If that sounds impossible right now, that’s okay! Why? Because millions of people have followed the Baby Steps and decided to redefine what the American Dream really means.

So, are you ready to redefine your American Dream?

Live Like No One Else

What if we said you can still pursue a life of freedom, an amazing career, the dream home and the retirement you didn’t even know you could have?

You can. But it starts with you. You’ve got to say “I’ve had it!” when it comes to living paycheck to paycheck. You’ve got to stop swiping that credit card and spending money that isn’t yours. You’ve got to stop signing your name on the dotted line for things that will take you more than a lifetime to pay back.

It’s time to pursue a new American Dream—a dream of being debt-free and living like no one else. A dream you actually want to pursue.

It all starts with the 7 Baby Steps. With hard work, intentionality and focus, you can make it to the finish line. And the best way to get going? Take Financial Peace University (FPU). You'll learn all about those Baby Steps and how to make your financial goals a reality—from saving and budgeting to investing and finding a dream career.

You can do this. Start FPU today!


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Ramsey Solutions

About the author


Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners. Learn More.

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