While a 2025 Archbridge Institute survey shows that most Americans (69%) still believe they’ve either achieved the American Dream or are on their way, there’s a massive generational divide lurking beneath the surface.
Younger Americans are officially the most pessimistic age group. According to a Wall Street Journal-NORC poll, only 25% of Americans feel they have a good chance of improving their standard of living—a record low in the poll’s 38-year history.
So, what gives? It’s easy to chalk it up to generational angst, but the reality is far more concrete. Gen Z’s skepticism isn’t about a lack of ambition; it’s a pragmatic response to a perfect storm of crushing debt, an impossible housing market, and a looming climate crisis that makes long-term planning feel like a fool’s errand.
The crushing weight of modern debt
For millions of young Americans, the financial race begins with a ball and chain already attached. The promise of a college degree was supposed to be a ticket to upward mobility. Instead, it’s become a decades-long financial burden.
For many in Gen Z, the so-called “investment” in education has morphed into a lifelong liability. The numbers are staggering. The average student loan debt for a Gen Z borrower is $22,948, according to EducationData.org. While that might seem lower than for older generations, their debt is growing at the fastest rate of any group, at a compound annual rate of 6.72%.
Here’s the kicker: after adjusting for inflation, the average Gen Z borrower has a 13% higher debt balance than Millennials did at the same age. So, no, it’s not the same struggle every generation faced. It’s quantifiably worse. And the monthly hit to their bank accounts is brutal. A 2025 Empower survey found that Gen Z pays an average of $526 per month toward student loan debt. That’s nearly double the overall average of $284 for all age groups.
Experts refer to this debt as a “double-edged sword.” It’s a resource that helps you get through college, but the moment you graduate, it becomes a “chronic stressor” that “hurts you.”
Why is this happening? The cost-of-college explosion
This debt crisis isn’t a result of frivolous spending; it’s the outcome of a fundamental economic disconnect that’s been brewing for decades.
Between 2000 and 2019, the inflation-adjusted price of college—including tuition, fees, and room and board—skyrocketed by 59%. And what about wages for college grads during that same period? They rose by a measly 5%.
Let that sink in. The cost of entry into the middle class has skyrocketed, while the financial reward for achieving it has remained essentially unchanged.
A generation starting in the red
This isn’t just an annoying monthly bill; it’s a life-altering force that dictates nearly every major decision a young person makes.
The dream of saving up, investing, and building wealth in your twenties has been replaced by a desperate scramble to get back to a net worth of zero. The years when previous generations were establishing roots are now a “lost decade” for wealth-building among Gen Z.
The data is precise. An astonishing 84% of Gen Z borrowers report that their student debt has forced them to put off significant life investments, such as buying a home or starting a business, as per the Education Data Initiative. According to data from the National Association of Realtors (NAR), among those who don’t own a home, 51% say student loan debt is the reason they’re delaying homeownership.
It even dictates their careers. The Education Data Initiative reports that a complete 72% of Gen Z borrowers admit to making employment decisions based on their student debt, often trapping them in jobs they dislike to make the hefty monthly payments.
The impossible dream of owning a home
Homeownership has always been the cornerstone of the American Dream. It’s more than just a place to live; it’s the primary means by which middle-class families have built wealth and stability for generations. But for Gen Z, that door seems to be slamming shut.
Running the numbers on a white picket fence
It’s not that Gen Z doesn’t want to buy a home. It’s that, for many, the math has become a cruel joke.
In 2022, the median sale price for a single-family home in the U.S. was 5.6 times higher than the median household income. That is a record high. To put that in perspective, this ratio has historically hovered around 5, and for many Baby Boomers in the 1980s, it was as low as 2.9.
The problem is accelerating. Between 2019 and 2022, national home prices increased by 43%. In that same window, median incomes grew by only 7%. This widening chasm is making the dream of ownership a statistical impossibility for millions of people.
A generation of renters?
The data on who actually owns homes paints a bleak picture for young Americans.
The homeownership rate for people under 35 is just 37%, the lowest of any age group. A staggering LendingTree study of the 50 largest U.S. metropolitan areas found that only 4.7% of adults younger than 30 have a mortgage.
This reality is creating a massive generational wealth gap. In 2025, Baby Boomers own about 40% of all real estate in the country. Meanwhile, Millennials—the generation just ahead of Gen Z—own less than two-thirds of the real estate that Boomers did at the same age.
By being locked out of the housing market, Gen Z isn’t only missing out on a financial asset but also on a significant opportunity to build wealth. They are being denied a stake in their communities and a traditional path to long-term stability. Instead of building equity for themselves, their rent checks build equity for their landlords.
Young people are facing a severe housing supply crunch and “have little choice but to pare down their list of must-haves.” A recent survey found that nearly one in four Gen Z buyers would even trade off some degree of safety to find a home they could afford.
An existential crisis called climate change
As if the financial hurdles weren’t enough, Gen Z is also the first generation to grow up under the constant, unavoidable shadow of a global climate crisis. This isn’t a distant problem for them; it’s a profound, personal, and existential threat that reshapes their entire outlook on the future.
The constant hum of eco-anxiety
Beyond the spreadsheets and bank statements, Gen Z is grappling with a deep-seated anxiety about the very planet on which they’re supposed to build their dreams.
This “eco-anxiety” is real and widespread. It isn’t just a vague worry; it has measurable mental health impacts. A 2022 poll found that 75% of Gen Z have experienced a mental health issue like anxiety or stress as a direct result of hearing news about climate change. Pew Research found that 69% of Gen Z felt anxious about the future, the last time they saw climate-related content on social media, a figure far higher than any other older generation.
But as mental health professional Leslie Davenport points out, this anxiety isn’t a sign of weakness. It’s a sign of awareness. “It means you care about what’s happening. You’re paying attention. You’re empathetic,” she says. It’s an entirely rational response to an existential threat.
Rethinking life, love, and the future
This anxiety isn’t passive. It is actively reshaping the most fundamental life decisions for an entire generation.
The climate crisis acts as a “threat multiplier” for all their other economic worries. Why struggle for decades to pay off a 30-year mortgage on a house in a city that could be plagued by wildfires or rising sea levels? Why save for a retirement you might not get to enjoy in a world destabilized by climate disasters?
This existential dread fundamentally shortens their time horizons and devalues traditional, long-term goals.
- Family Planning: A PVFARM survey found that a stunning 38% of Gen Z say climate change is making them less likely to have children.
- Career and Location: The crisis is dictating where they live and what they do. A majority—69%—say climate change will influence where they choose to live, and 67% expect it to affect their career choices.
As Professor Dora Marinova of Curtin University puts it, “Gen Z has serious concerns which will not only impact their mental health… but also the choices young people make: how they spend their money, whether they have families, their choice of career and more.“
Redefining, not rejecting, the dream
After all this, it would be easy to think Gen Z has given up. But that’s not the whole story.
They haven’t rejected the core tenets of the American Dream—happiness, stability, and freedom. They are just being forced to redefine them in a world that looks nothing like the one their parents or grandparents grew up in.
The dream is no longer about accumulating wealth, which only 15% of people now say is essential. Instead, it’s about “freedom of choice in how to live” (83%) and “having a good family life” (80%). When asked to redefine their dreams, Gen Z ranks good mental and physical health as their top priority, followed by financial stability.
The death of the old American Dream isn’t a tragedy if it makes way for a new one that’s more sustainable, equitable, and focused on well-being over sheer material gain. Gen Z isn’t killing the dream; they’re trying to build one that can actually survive the 21st century.
Key Takeaway
- Gen Z’s pessimism about the American Dream isn’t a sign of laziness; it’s a rational response to real barriers.
- Crippling debt and an impossible housing market have blocked traditional paths to wealth. With student debt 13% higher than for Millennials at the same age and home prices at a record 5.6 times the median income, the financial math no longer adds up for many.
- The existential threat of climate change makes long-term planning feel pointless. Over 80% of Gen Z are anxious about the climate, a fear that directly impacts their career decisions, where they live, and even whether to have children.
- They are redefining the dream. For Gen Z, the new American Dream prioritizes mental health, freedom of choice, and financial stability over traditional markers like homeownership and wealth accumulation.
Disclaimer – This list is solely the author’s opinion based on research and publicly available information. It is not intended to be professional advice.
Disclosure: This article was developed with the assistance of AI and was subsequently reviewed, revised, and approved by our editorial team.
16 Grocery Staples to Stock Up On Before Prices Spike Again
16 Grocery Staples to Stock Up On Before Prices Spike Again
I was in the grocery store the other day, and it hit me—I’m buying the same things I always do, but my bill keeps getting higher. Like, I swear I just blinked, and suddenly eggs are a luxury item. What’s going on?
Inflation, supply-chain delays, and erratic weather conditions have modestly (or, let’s face it, dramatically) pushed the prices of staples ever higher. The USDA reports that food prices climbed an additional 2.9% year over year in May 2025—and that’s after the inflation storm of 2022–2023.
So, if you’ve got room in a pantry, freezer, or even a couple of extra shelves, now might be a good moment to stock up on these staple groceries—before the prices rise later.
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