According to a recent research conducted by the company Clarify Capital, the most sought-after portfolios by US citizens involve ETF and crypto.
Income and wealth in the USA: how much is needed to live well
In this article, we delve into the psychology of American citizens thanks to the study “Redefining the American Dream” by the consulting firm Clarify Capital.
The so-called “American dream” represents the myth that still today motivates millions of people in the USA to achieve their financial and work-related goals.
The article “Redefining the American Dream” written by Emma Parker for Clarify Capital, is based on a 2024 survey conducted with 1000 Americans.
The objective of the insight is to discover how different generations in the USA perceive the famous myth of the “American dream” and how they plan to achieve their financial and career goals. Spoiler: crypto and ETFs are among the top 5 asset classes for investment.
The first interesting data concerns the amount of savings and annual cashflow that Americans on average think they need to live well.
On average, U.S. citizens need a net annual salary of 110,000 dollars and assets of 150,000 dollars.
What emerged from the survey makes the most saving categories reflect: in the event of a loss of income, the savings would allow maintaining the same lifestyle for 16 months before going bankrupt.
The Italians, on the other hand, usually live a more frugal life and wish to set aside more than what would be spent in 16 months.
Despite the American dream in this case being quite modest in terms of financial goals, it must be said that few will achieve it.
According to the survey, about 50% of respondents say that these numbers are indeed unattainable for ordinary people.
In particular, 64% of the USA citizens surveyed report that it is highly unlikely to reach the condition of “debt-free” within 5 years.
Next, 62% believe that it is impossible to own a house within the same timeframe. Finally, 48% state that they are skeptical about being able to retire and go into pension as a set goal.
In all this, it must be said that the sentiment changes based on generations: among the various age distinctions, the perception of savings and the amount that seems to be necessary to live adequately varies.
- Baby boomers, born between 1946 and 1964: $135,000
- Gen X, born between 1965 and 1980: $140,000
- Millennials, born between 1981 and 1994: $145,000
- Gen Z, born between 1995 and 2010: $160,000
ETF and crypto among the most desired investment portfolios in the USA
Very interesting to understand what the preferred investment strategies of Americans are to achieve the goals of the American dream.
According to the survey, on average among the choices of the best “asset portfolio” 70% of these are primarily based on Real Estate. Following this, 69% refer to a portfolio centered on stocks of various types while 30% follow the trend of admiration towards precious metals.
ETF and Crypto have earned a place in the top 5 most desired assets by USA citizens. In particular, ETFs are in 28% of the most desired portfolios while crypto reaches 25%.
Here too, the trends vary based on the type of generation and the age of the respondents.
Baby boomers, GenX and Millennials agree that real estate investments should be at the top of the list of the best asset classes.
Gen Z instead (and partly also Gen X) believes that stocks should be placed in the foreground for an optimal portfolio.
ETFs, including those in crypto such as the various exchange-traded-funds based on Bitcoin, are in third place in the rankings of Millennials and Gen X.
The extremes of the Baby Boomers and Gen Z, on the other hand, have totally different tendencies and place precious metals and luxury goods in third place, respectively.
To all this are added the data on labor flexibility, as the salary from work turns out to be today the main income flow in the USA and in the world.
74% of respondents say that to achieve the American dream it is necessary to value a flexible work schedule that adapts to their social and family needs.
67% would instead like more career opportunities while 62% are looking for a more competitive salary.
The main barriers to achieving financial security and the American dream
Although investments in real estate, stocks, precious metals, ETFs, and crypto can represent a path to achieving the “American dream,” there are also limits that hinder the goals of Americans.
On average, 2 out of 5 Americans, including 32% of Gen Z, believe they will never be able to live the life of their dreams.
The barriers that bring these few ambitious thoughts are determined for 70% by the inflation of the US dollar. This also explains the presence of crypto in the best asset classes, as they are known for their “anti-inflationary” power.
We remind you that in the last 10 years, more dollars have been printed than were introduced into the market in the last century of history:
Following this, 47% of the barriers are represented by the lack of a comfortable home, which can motivate the drive towards achieving goals.
This represents a strong contradiction as the same Americans say they spend a lot on the house rather than on other necessities. On average, moreover, 90% of Americans prefer to own a house rather than rent.
Among the “excuses” that limit the American dream, we then see 45% citing poor skills in finding the right job and 27% citing lack of healthcare access.
Finally, a 22% represents motivations with a political background, where some laws would hinder work and financial success.
It also appears at least somewhat obvious how low-income classes are less optimistic compared to high-income ones in being able to fulfill the American dream.
According to the survey, in fact, 50% of those with an annual income of less than $50,000 say they will not be able to achieve their set goals.
Rising into the middle class, with annual salaries between 50,000 and 149,999 dollars, the threshold of negative thoughts drops to 34%.
Finally, among the high-income classes, above $150,000 per year, only 19% do not think they can achieve the American dream.