Did Older Generations Have an Easier Path To The American Dream? It May Depend on One’s Definition

Buying a house in America is not cheap. No one can debate this fact. The question is: Was it always this hard and is there some conspiracy within the community of the wealthy to make sure the American dream of home ownership, with a bit of wealth, is impossible to achieve for anyone under the age of 30?

In the past year, younger generations have taken to social media to start a housing revolution aimed at two targets: One, the capitalistic system they claim is rigged to pay them too low of a wage to ever become homeowners and, two, the “greedy” homeowners that buy up property and then rent them out to folks who cannot obtain home ownership for outrageous rental prices, trapping them in a cycle of never-ending struggle.

Many younger folks are accusing older generations of being tone-def to their struggles, or worse, blaming them for using the wealth they have created for themselves as a weapon against younger folks. A wealth younger folk say was made far too easily during an easier time in history.

This narrative is a simplified response to a multifaceted and complicated situation.

The problem is not a conspiracy by the upper-class and the rich or the idea that America’s economics has changed from “affordable” in the 1950s to “unattainable” in the 2020s. The answer may lie within how different generations define certain words. Terms such as “easier,” “affordable,” “struggling” and most importantly “sacrifice.”

How different generations define these terms better explains the difference between the actual struggles of one generation and the perception a younger generation has when they compare their struggles to older ones.

What does this mean?

Let’s start with the definition of a “house” as a basic example of my point.

According to Compass California, a real estate blog, the average house in the 1950s was 932 square feet, 2 bedrooms, 1.5 baths and cost about $8,000. This was the definition of a “house” to most Americans.

In 2022, this is not how a house is defined. Most homes built in the last 35 years have been a minimum 3 bedrooms and 2 baths and around 1,300 square feet minimum. Go beyond the year 2000, and you’ll see average home size growing rapidly. According to real estate experts Million Acres, in 2022, the average American house is 2,400 square feet.

For most young folks born around the turn of the millennium, this is what a house looks like.

When younger folks make the claim that “back in the day” one person could work and afford a home on that one salary, this was true… but that one home was under 1,000 square feet, basic and small. That’s not what a house is today.

This is what I mean when I refer to the disconnect coming from how different generations define certain terms rather than an actual gap in wages and the cost of whatever it is younger folks want to obtain.

When younger folks say “they can’t afford a house like previous generations could on one salary,” I would imagine they’re talking about the average homes of today and not a 932 square-foot basic house.

It’s about the definition of “house.”

On one salary, younger folks would be able to buy a house like Boomers did 50-plus years ago. A quick search on Zillow shows us a 980 square-foot, 3 bedroom, 1 bath house in Omaha, NE for $80,000. It’s a nice well-kept home, but it is small and basic. For reference, $8,000 in 1950 is equivalent to $92,000 in 2022. A 30-year fixed loan with current APR on $80,000 is $388 a month. Factor in property tax, loan interest, and insurance, it’s probably about $500 to $600 a month. The minimum wage in Nebraska is $9.00 with an average income of $27 an hour.

This brings us to the overall claim that older generations “had it easier” on their journey from being broke high school graduates to some stage later in life where they had achieved the American dream. Was it easier back in the day?

Again, this comes down to how generations define words like “easier,” “affordable,” “struggling” and most importantly, “sacrifice.” How would I define these words versus some younger folks? Newer generations’ definition of how “easy” it was may be vastly different than older generations and their definitions of what are “luxuries” and what are “minimums” are vastly different too.

Let’s start with what most folks, regardless of age, would like to have as an adult.

1.) No roommates.

2.) A decent-sized house with a minimum 3 bedroom/2 bath.

3.) That house to be in a nice area of town.

4.) A nice car or two, not just a reliable car.

5.) Have enough disposable income to go on regular vacations and go out regularly without worrying about having enough money to do these things.

6.) Having enough money to take care of one’s children, and that never changes even if one has more and more kids.

7.) No debt except for a house and maybe a car because the person has enough money to buy anything else they would want in cash.

8.) With everything listed above, they still can save easily for a real retirement.

Do younger folks see these things as “luxuries” or “minimums?”

I’m going to use myself as an example and chart my own journey from a broke high school graduate to obtaining a lot of wealth, properties, assets, retirement, and plenty of disposable income.

I’m 42, Generation X’er, hold a bachelor’s degree in journalism and a master’s degree in English. I have worked primarily two jobs: journalist and teacher.

I didn’t buy my first house until I was 35. I had roommates on and off over 15 years living in questionable areas, mostly in apartments or renting rooms in homes.

I bought my first nice car at 30.

I didn’t have disposable income to a level of never worrying about vacations and going out until 35.

My college debt (BA) took 10 years to pay off (graduated at 25, paid off at 35), MA was paid out of my pocket (graduated at 39).

The one thing I did do was save every penny I could starting at the age 20, even if it was $10 a month, and that’s paid off big time. Do younger folks see how insignificant amounts saved now become very significant later?

I didn’t have kids because I didn’t have a house to raise any or the money to do so. For younger folks, this may be where real financial burdens come into play. Regardless of the debate, the fact stands that if one has children without the financial stability first, they will struggle far beyond others.

Some feel “it shouldn’t be this way,” while others accept that it simply “is this way.” Again, it’s how we define words like “sacrifice.” Younger folks seem to feel that older generations didn’t have to make the same sacrifices that they have to make today to obtain the same level of socioeconomic standing. Older generations define sacrifice differently. Younger generations’ definition of sacrifice is different, and they often see older generations’ definition of sacrifice as wholly unacceptable.

At the end of the day, the similarities of my situation compared to young folks today isn’t much different.

In my 20s I was living hand-to-mouth, in college debt, was working in either journalism or teaching (both low-paying careers) and couldn’t even sniff buying a house or renting a place without roommates. By the time I was in my 30s, I had sacrificed enough of my life to afford my first home and some other luxuries.

So, if you’re in your 20s and struggling, that isn’t new or uncommon. If you’re in your 30s and still not quite there, this is not uncommon either. It’s true that the wage gap and the ability to obtain the American dream is a bit harder than it was many decades ago, but it isn’t as big of a gap as many claim it to be and isn’t vastly much different than previous generations.

The struggle is real… it always has been. The American dream certainly isn’t impossible to achieve today and will require sacrifice. Whether or not you agree with this may ultimately depend on your definition of a few words.