American Dream

Loading the player...

What is the 'American Dream'

The belief that anyone, regardless of where they were born or what class they were born into, can attain their own version of success in a society where upward mobility is possible for everyone. The American dream is achieved through sacrifice, risk-taking and hard work, not by chance. Both native-born Americans and American immigrants pursue and can achieve the American dream. In contrast to other political and economic systems, such as communist dictatorships, America’s free-enterprise system makes possible the circumstances that allow individuals to go beyond meeting their basic needs to achieve self-actualization and personal fulfillment.

BREAKING DOWN 'American Dream'

The tenets of the American dream can be found in the Declaration of Independence, which states, “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.” In a society based on these principles, an individual can live life to its fullest as he or she defines it.
 
The American dream requires political and economic freedom as well as rules of law and private property rights. Without them, individuals cannot make the choices that will permit them to attain success, nor can they have confidence that their achievements will not be taken away from them through arbitrary force.
 
The American dream offers the freedom to make both the large and small decisions that affect one’s life; the freedom to aspire to bigger and better things and the possibility of achieving them; the freedom to accumulate wealth; the opportunity to lead a dignified life; and the freedom to live in accordance with one’s values, even if those values are not widely held or accepted.
 
Home ownership is frequently cited as an example of attaining the American dream. It is a symbol of financial success and independence, and it means having the ability to control one’s own piece of property instead of being subjected to the whims of a landlord. Owning one’s own business and being one’s own boss also represent American dream fulfillment.

RELATED TERMS
  1. Tax Freedom Day

    The day that the average American has earned enough money (in ...
  2. Freedom Shares

    Original issue discount bonds issued by the U.S. Treasury from ...
  3. Index Of Economic Freedom

    A ranking of countries or states based on the number and intensity ...
  4. Degrees Of Freedom

    In statistics, the number of values in a study that are free ...
  5. Federal Home Loan Bank Act

    An act passed by the Hoover administration in 1932 that was designed ...
  6. Anarcho-Capitalism

    A term coined by Austrian-school economist Murray Rothbard to ...
Related Articles
  1. Active Trading

    Is the American Dream Dead?

    Find out why the American Dream lives on and how entrepreneurial optimism is driving more innovative start-ups in an age of information technology.
  2. Savings

    These 10 Habits Will Help You Reach Financial Freedom

    Learn 10 key habits for achieving financial freedom, including smart budgeting, staying abreast of new tax deductions and the importance of proper maintenance.
  3. Professionals

    6 Ways To Find Your Dream Job

    Find out what job you really want to do and tips for getting there.
  4. Your Practice

    Advisors: Are You Truly Ready to Go Independent?

    Advisors considering going independent need to make sure they're well-prepared. Here's what they need to consider.
  5. Home & Auto

    6 Signs That You've Made It To Middle Class

    If you can check off each of these points, you are likely a member of the middle class.
  6. Savings

    10 Steps to Retiring as a Millionaire

    Retiring with a million-dollar portfolio may sound like a dream, but it’s certainly attainable.
  7. Insurance

    Making A Larger Down Payment Vs. Buying a Cheaper House

    We look at the financial differences between purchasing a cheaper home and making a larger down payment on a more expensive home.
  8. Economics

    Can Socialism Work In America?

    Capitalism has its shortcomings, but pure socialism is not the answer. The American system of capitalism with socialistic touches might be good for the US.
  9. Economics

    6 Signs That You’ve Made It To Middle Class

    A government task force pinpointed the six financial aspirations that characterize life in the middle class.
  10. Investing News

    Comparing Investment Strategies: The 1% Vs. the 99%

    Discover how the wealthy 1% differ from the other 99% when it comes to investment opportunities and other financial management concerns.
RELATED FAQS
  1. How does the notion of the American Dream influence the US economy?

    Learn about how the American Dream has influenced the U.S. economy. The American Dream is the idea that anyone can make it ... Read Answer >>
  2. How was the American Dream impacted by the housing market collapse in 2008?

    Learn how the American Dream was impacted by the housing collapse in 2008. Due to the housing collapse, millions ended up ... Read Answer >>
  3. What does the American Dream mean to different generations?

    Find out what has caused the American Dream to change radically from the Baby Boom generation to the members of Generation ... Read Answer >>
  4. What advice has Larry Page given to would-be entrepreneurs?

    Learn how over the course of his career, Larry Page has advised new entrepreneurs to dream big, all while keeping an eye ... Read Answer >>
  5. What are the main differences between a mixed economic system and pure capitalism?

    Read about the primary differences between a mixed economic system and a laissez-faire, free market economic system with ... Read Answer >>
  6. What is the difference between communism and socialism?

    Learn how some countries are incorporating socialist methods into capitalism. Read Answer >>
Hot Definitions
  1. Reverse Mortgage

    A type of mortgage in which a homeowner can borrow money against the value of his or her home. No repayment of the mortgage ...
  2. Labor Market

    The labor market refers to the supply and demand for labor, in which employees provide the supply and employers the demand. ...
  3. Demand Curve

    The demand curve is a graphical representation of the relationship between the price of a good or service and the quantity ...
  4. Goldilocks Economy

    An economy that is not so hot that it causes inflation, and not so cold that it causes a recession. This term is used to ...
  5. White Squire

    Very similar to a "white knight", but instead of purchasing a majority interest, the squire purchases a lesser interest in ...
  6. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
Trading Center