A colleague recently sent me a copy of the 2009 Metlife Study of the American Dream. In reviewing the report, I was immediately struck with how dramatically Americans have altered their expectations in response to our changing economy. And, because the survey has been conducted every year for the last three years, the researchers were able to analyze and document this rapid and unprecedented shift in priorities.
For example, the inaugural American Dream survey conducted in 2007 revealed an insatiable hunger for more and better material possessions. In addition, the bar was continually rising for what was considered “basic necessities.” However, across all social strata, the financial crisis has been a loud wake-up call. Respondents to the 2009 survey reported they are eating at home more often, shopping more at big box discount stores, spending less on movies, and moving away from brand-name products to generics.
The study also revealed that 4 in 10 Americans are feeling “buyer’s remorse” about past purchases, and wish they had spent less and saved more over the years. In fact, many now feel freed from the pressures of “keeping up with the Joneses,” and view the economic crisis as “permission” to change their behavior.
Amazingly, 75 percent of the study participants still believe they will achieve the American dream in their lifetimes. In light of this finding, the researchers concluded that this hope is fueled, in part, by Americans’ ability to adjust their definition: “As credit remains in short supply and investments deteriorate, Americans have replaced (at least temporarily) their desire for a better financial future with the pragmatic goal of staying afloat and focusing on relationships with family and friends.”
Marriage also figures a more central role—27 percent of Americans now identify marriage as synonymous with the dream, up from 17 percent just one year ago. Generation Y, in particular, views wedlock as a prerequisite, with 32 percent of young Americans defining the dream in terms of marriage and a committed relationship.
In addition, they are making significant lifestyle changes. Nearly 40 percent reported a greater focus on healthy living, such as exercising and making better food choices, and 59 percent indicated they are spending more time thinking about personal life goals.
These results should give financial planners tremendous insight into the current mindset of their clients and prospective clients. I believe those practitioners who have developed a life-centered, values-based approach to developing client relationships are well poised to respond to this change, and will likely demonstrate a keen competitive edge in the marketplace.