And yet the dream is very much alive. A recent article by Stephen Moore and Lincoln Anderson titled The Great American Dream Machine reveals that according to the latest Federal data, six of every ten families in the United States have a net worth (the value of their assets minus their debts) over $100,000. In other words, today most American families’ wealth exceeds €85,000. In 1967 the number was only one in four. During this period, the percentage of families earning $75,000 or more a year increased from 9 to 27 percent. If we divide US society in five parts, each with an equal number of people, the middle fifth, representing the middle class, which in 1967 earned between $28,000 and $39,500, now earns between $38,000 and $59,000. To call an American “poor”, one has to include in this category people with the same standard of living as an average Spanish family.

 

The United States is a dynamic and creative society. It allows its citizens to make considerable progress in a single generation. But if we look closer at this country’s millionaires, we see the extent to which the American dream is alive and well. Thomas J. Stanley and William D. Danko are the most respected experts on American millionaires; their book, The Millionaire Next Door, is an ambitious and complete study of this group. More than three and a half million US families have assets worth a million dollars or more. Who are they? What did they do to achieve this lofty position?

 

After studying millionaires for 20 years, Stanley and Danko have found that American millionaires save, live below their possibilities and believe financial independence is more important than a high-flying lifestyle. They choose an appropriate job and dedicate their time, energy and money in the most efficient ways possible. They also know how to recognize the opportunities the market offers. And they do not have serious family burdens.  

 

Four out of five American millionaire families have earned their wealth in a single generation. You don’t need to inherit family money to be a millionaire in the United States. You do need to work 45 to 55 hours a week. They are generally self-employed (about two-thirds) or professionals. Almost all of them save or invest15 percent or more of their income. Of the rest, a sizeable amount goes to educating their children. What have they achieved behaving in this way? That their annual income makes up less than 7 percent of their wealth. In other words, they live off of less than 7 percent of their accumulated wealth. They could stop working and creating wealth and till maintain their standard of living. And, I repeat, they do it in a single generation.