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It-s-Your-Life

The American Dream

From Cadillacs to mortgages, the American Dream has been used to idealize a lifestyle that is today considered a right, not a privilege.

The original definition of the American Dream came from James Truslow Adams in 1931. He said, "Life should be better and richer and fuller for everyone, with opportunity for each according to ability or achievement, regardless of social class or circumstances of birth.” 

It was a promise. If you worked hard, you could get your piece of the dream.

For the record, we Canadians mostly believe in our right to that same dream.

Much has changed, though, since 1931, and the dream has become more about stuff than personal fulfillment, character, and opportunity. It’s now about what you can own, as opposed to the kind of person you could become, or what you could earn or create.

The question lying just below the surface of all this dream talk is, how do you achieve the promised life when it’s harder to make money in the first place, and even harder to translate it into dependable long term income?

The answer isn’t so much about how, it’s about what. 

The world has changed, and we need to make different choices to reflect those changes. It’s possible to retire well, but it’s not all about what you make - it’s also about what you spend. A big part of reaching your goals is not what you’re willing to do, but what you’re willing to do without. 

Many families today opt to travel and enjoy life when the kids are younger and at home, or if they have no kids when they are in their younger years. This is a lifestyle choice, but it isn’t one without its financial consequences. For some, it could mean a less comfortable retirement.

The rising costs of goods, coupled with a flattening of wages over the past 30 years, have made it more difficult for people to accumulate wealth in the first place. Volatile stock markets combined with historically low interest rates have made it harder to generate consistent, reasonable, low risk returns on savings. Manufacturing jobs, union wages and defined benefit pensions are all becoming a part of the past. 

Careers aren’t what they once were either. The dream came with an expectation of a single career path at the same company, from high school or college graduation to retirement. It was an implied promise that went both ways: The company looked after you and you looked after it, or at least that’s the way the story was told. 

Corporate downsizing, technology and outsourcing have all taken their toll on the golden promise. Today, we change careers more often than we change cars. We start businesses in our spare time that lead to new careers, partnerships, opportunities, and retirement jobs.

It’s not all bad news – there are silver linings. Today we’re not only living longer in absolute terms, but we’re also living healthier and more meaningful lives in our later years. For many of us, the ability to work is a vital part of who we are. The thought of Freedom 55, 65 or even 75 is a foreign language. Working beyond the set retirement date is one way to level the playing field and allow people to live fuller lives. 

While the traditional models are no longer there for us, there are new models filled with opportunity. It has never been easier to start your own business, to turn your art (whatever that might be) into money, or to create a career from the comfort of your own home, or the keyboard of your laptop. We’re no longer limited by startup capital, geography, or education - not if we’re looking for a job or career off of the corporate ladder. 

I had a conversation with a man last week who told me about a friend who is a radiologist in a city in Europe. He’s decided to move his family away from the challenges and complications of life there, and to start again in the relative calm of the Okanagan Valley. 

He will sell his home in Europe for a decent price, which will allow him to own a comparable home here. Best of all, he’ll be able to continue his overseas work from their new home here. X-rays are digital, which enables him to do the same work for the same people regardless of where he is. While this may not be a common story, it’s a great example of the flexibility and options available if we’re willing to look outside the box.

When the economy is bad, the rates are low, and retirement looks a long, hard way off, don’t think the worse. Throw off the blinders and, with your eyes wide open, look around. Don’t sell yourself short, and whatever you do, don’t accept the limitations of the old world. 

As Yogi Berra said, “It ain’t over ‘til it’s over.”

Questions or comments: [email protected]

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.

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About the Author

Jeff Stathopulos, CIM, CFP, Portfolio Manager

Jeff is an advisor and partner with The Navigation Team at Scotia Wealth Management.

He lives in Kelowna with his wife Tanya, their two university bound daughters and their canine kids.

You can contact Jeff by email at [email protected]

Website:  www.yourlifeyourplan.ca

The Navigation Team

Scotia Wealth Management

This column is for information purposes only. It is recommended that individuals consult with their financial advisor before acting on any information contained in this article. The opinions stated are those of the author and not necessarily those of Scotia Capital Inc. or The Bank of Nova Scotia. ScotiaMcLeod is a division of Scotia Capital Inc., Member Canadian Investor Protection Fund.



The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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