The American dream has morphed into a pipe dream for many people living in the U.S., says a report by Money wise.
The report — ‘The new American dream is to leave’: Most in the US don’t believe hard work will get you ahead. Here’s what some are striving for instead (Thu, January 4, 2024) — said:
At the heart of the national ethos is the belief that anyone can rise from rags to riches through hard work and perseverance. In the past, that was symbolized by owning a large house with a white-picket fence, driving a nice car and having a happy, healthy and well-educated family.
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But 45% of people think the American dream no longer holds true, according to a Wall Street Journal-NORC poll (https://s.wsj.net/public/resources/documents/WSJ_NORC_Partial_Oct_2023.pdf) from October — while 18% think it never held true.
This survey, funded by the Wall Street Journal, was conducted by NORC at the University of Chicago. Staff from NORC at the University of Chicago and the Wall Street Journal collaborated on all aspects of the study. A sample of registered voters aged 18 or older was selected from NORC’s AmeriSpeak Panel for this study. Survey respondents who confirmed they were currently registered to vote were considered eligible to take the survey. The sample for a specific study is selected from the AmeriSpeak Panel using sampling strata based on age, race/Hispanic ethnicity, education, and gender (48 sampling strata in total). Sample selection takes into account the expected differential survey completion rates across the sampling strata. The size of the selected sample per stratum is determined such that the distribution of the complete surveys across the strata matches that of the target population as represented by census data. If a panel household has more than one active adult panel member, only one adult panel member is selected at random. When panelists are selected for an AmeriSpeak survey, the selection process, within each sampling strata, favors those who were not selected in the most recent previous AmeriSpeak survey. This selection process is designed to minimize the number of surveys any one panelist is exposed to and maximize the rotation of all panelists across AmeriSpeak surveys. Interviews for this survey were conducted between October 19-24, 2023 with registered voters aged 18 and over representing the 50 states and the District of Columbia. Panel members were randomly drawn from AmeriSpeak, and 1,163 completed the survey—1,136 via the web and 27 by telephone. Panel members were invited by email or by phone from an NORC telephone interviewer. Interviews were conducted in both English and Spanish, depending on respondent preference. Respondents were offered a small monetary incentive for completing the survey. The final stage completion rate is 22.4 percent, the weighted household panel response rate is 21.5 percent, and the weighted household panel retention rate is 78.9 percent, for a cumulative response rate of 3.8 percent. The overall margin of sampling error is +/- 4.03 percentage points at the 95 percent confidence level, including the design effect. The margin of sampling error may be higher for subgroups. Sampling error is only one of many potential sources of error and there may be other unmeasured error in this or any other survey.
The Money Wise report said:
So, what is the new American dream?
For some — like TikTok influencer and full-time traveler Bryn Elise — “the new American dream is to leave.”
As many Americans experience economic disenfranchisement at home, a few may be looking beyond U.S. borders to locate life’s sparkle.
New American Dream
The Association of American Residents Overseas (AARO) estimates that at least 5.4 million (https://www.aaro.org/about-aaro/how-many-americans-live-abroad) Americans lived abroad in 2023. The biggest share of expats (40%) are thought to live in the Western hemisphere — Canada, Central and South America — or Europe (26%), while 14% headed to East Asia and the Pacific.
Elise described in a video posted June 23 that for some the new dream was to “pack up and head to a quiet European town or a beachside village in Asia; somewhere where we are not being poisoned by our food, we do not need 2-3 jobs to survive and where health care is not the luxury but the norm.
“Some place where people stop and appreciate the little things and enjoy the slow life; a safe place where the community comes together and supports one another.”
The Money Wise report said:
Clearly, the young American is searching for more affordability and flexibility than she believes she can experience in the U.S.
It has been a tricky few years from an affordability standpoint for many Americans. The Federal Reserve’s efforts to curb post-pandemic inflation by hiking interest rates have increased the cost of borrowing and reduced Americans’ purchasing power.
This has forced a lot of Americans to focus more on short-term goals (paying rent on time and putting food on the table) over longer-term goals (homeownership, raising a family and retirement) that one might traditionally associate with the American dream.
Dollars Behind The Dream
The report said:
Cost is one key factor behind the demise of the American dream.
Recent analysis by Investopedia revealed that you now need a whopping $3.4 million to cover the costs of traditional American dream milestones such as marriage, raising children and owning a home.
But most Americans fall short of that target by over a million dollars. The average lifetime earnings of Americans across all education levels is closer to $2.3 million, according to Investopedia, leaving a big financial gap that is forcing people to reassess their life goals.
“We have been misled to believe that life is about enduring our circumstances and place of birth, but it is not a requirement in life that you have to stay in the same place you were born and spend your life struggling,” Elise said in her video. “The fact is, the old American dream just simply does not serve us anymore.”
One look at the attainability of a basic element of the traditional American dream — homeownership — is telling.
According to real estate brokerage Redfin, 2023 was the least affordable year for home buying on record. To buy a median-priced home, worth $408,806, with the median U.S. income $78,642, you would have had to spend a record 41.4% of your earnings on housing costs, up from 38.7% in 2022 and 31.0% in 2021.
To buy that same home without spending more than 30% of your income — a popular rule of thumb among personal finance experts — you would need an annual salary of $109,868, according to Refgin, which is $31,226 more than the typical household makes in a year.
Freedom and flexibility
The Money Wise report said:
Elise extols the virtues of being a digital nomad.
“Hands down, the best part about being a U.S. citizen is our ability to leave the U.S. and travel abroad to seek out a better life,” Elise said. “Let’s take a moment to recognize how lucky we are that we can leave.
“Let’s focus on getting remote jobs, or building online businesses, grab our passports and take advantage of the fact that, because of the internet, we have the ability to earn U.S.-level income from anywhere in the world.”
The lifestyle Elise is describing bears some resemblance to parts of the traditional American dream — notably the notions of equal opportunity and prosperity through hard work and determination — just not in the U.S.
Rather than trying to achieve a certain social status based on assets owned, perhaps the American dream today is more about an attitude that Americans carry with them wherever they are in the world.
Paris-based the Association of Americans Resident Overseas (AARO) said in a report (How Many Americans Live Abroad?, By Doris L. Speer, AARO President, November, 2023, © 2024 AARO – Association of Americans Resident Overseas. A 1901 non-profit association under French law in 1973):
Estimating the numbers of Americans living overseas is challenging, as we explain later on. AARO has for several years communicated that 8.7 million Americans live abroad, based on a State Department estimate from 2015.
The State Department has increased its estimate to 9 million. But the State Department number is said to count all Americans outside the U.S. for any reason, including tourists, not Americans living abroad. Other organizations, both inside and outside the Government, have different estimates. So AARO decided to revisit the situation to see if we could establish a more accurate estimate.
From AARO’s research, we found six estimates of the number of Americans living overseas, some widely divergent, so we tried to understand the basis on which they were made, their assumptions, sources and supporting data, so as to refine our own estimate.
Based on this research, AARO believes that at least 5.4 million Americans live abroad in 2023.
We describe below the six different estimates that we found in our research.
Two Contradictory U.S. Government Estimates of the Number of Overseas Americans
Department of State Estimate: 9 Million
The U.S. Department of State’s Bureau of Consular Affairs publishes a one-page brochure called “CONSULAR AFFAIRS BY THE NUMBERS” which states, without explanation, that “an estimated 9 MILLION U.S. citizens live overseas.” See State Dept Brochure. The Department of State has been using this number since 2016. We cannot determine the basis on which State has made this estimation. According to the Defense Department’s Federal Voting Assistance Program (discussed later), the Department of State’s estimates of the number of overseas civilians “are used for contingency operations and appropriately result in an overestimation.” See Frequently Asked Question No. 6 in FVAP Analysis.
The State Department’s earlier 2015 estimate of 8.7 million Americans living abroad was published in the 2018 U.S. Government Accountability Office (GAO) report “Workplace Retirement Accounts,” along with State Department estimates by geographic region, based on data as of April 21, 2015. See GAO Report, Appendix II, page 60. Although we show you below this regional breakdown for your information, we remind you that this table is based on the 2015 8.7 million number, that the State Department’s estimate is now at 9 million, and that the State Department’s numbers are overestimations:
| Region | Number of Americans (2015 Data) |
| Africa | 231,854 |
| Western Hemisphere | 3,706,577 |
| Europe and Eurasia | 2,027,914 |
| Near East | 1,019,457 |
| East Asia and Pacific | 1,135,114 |
| South Central Asia | 618,772 |
| Total | 8,739,688 |
[Please note that, while tables in this document show numerical results down to the individual person, these specific numbers are estimates and not exact counts.]
The Department of Defense’s Federal Voting Assistance Program (FVAP) Estimate: 4.8 Million
The Federal Voting Assistance Program (FVAP) is a voter assistance and education program established by the United States Department of Defense. It is statutorily mandated to report on the registration and voting activities of the populations the FVAP serves after each general election, including U.S. citizens living overseas. The FVAP sponsors the Overseas Citizen Population Analysis (OCPA) to learn more about the U.S. overseas citizen population. The OCPA uses a statistical model averaging methodology to estimate the number of overseas Americans and their distribution across countries. (Note 1)
The FVAP recognizes that its estimate of overseas citizens is different from that of other groups, stating on its website that population estimates created by other groups: (a) excluded key countries; (b) were produced for years before 2014; or (c) used different definitions of U.S. citizens or methods of counting them.
The FVAPs 2020 Overseas Citizen Population Analysis Report estimated that there were 4.8 million U.S. citizens living overseas in 2018, distributed across 186 countries (2020 data not yet available). This FVAP estimate does not include military personnel or their families. (Note 2)
The breakdown by region is as follows:
| Region | Number of Americans (2018) |
| North America | 1,447,712 |
| Europe | 1,322,113 |
| South/Central America | 590,187 |
| East Asia | 466,212 |
| Middle East/North Africa | 362,531 |
| Oceania | 204,372 |
| South East Asia | 149,402 |
| North/Central/South Asia | 123,653 |
| Sub-Saharan Africa | 113,747 |
| Total | 4,779,929 |
The FVAP estimates that the five most populous countries are the following:
| Country | Number of Americans (2018) |
| Canada | 860,783 |
| Mexico | 586,129 |
| United Kingdom | 391,141 |
| France | 248,168 |
| Israel | 304,542 |
The Number of Overseas Americans Based on Other Analyses
Mr. Pinto’s Estimate: 4.8 Million
AARO consulted with Mr. Heitor David Pinto, an electrical engineer working at a U.S. Government research laboratory near Washington D.C. For many years, Mr. Pinto has, in his personal capacity, researched international topics and has been involved in advocacy for international individuals, in particular Americans abroad. (Note 3)
Mr. Pinto made a deep analysis and has recently estimated that a total of 4,835,864 U.S. citizens live overseas. He shared his research with us.
Mr. Pinto started from data compiled by the United Nations for 2015 from the most recent census of every country, and updated it with census data up to 2020 from some individual countries. The census data of each country shows the number of people residing there who were born in each other country so, in the case of Americans abroad, it means only people born in the U.S. Mr. Pinto then took the more detailed census data from some countries showing parents’ place of birth to estimate the number of Americans born there from a parent who was born in the U.S., and applied it to all other countries proportionally.
His analysis then presents the number of U.S. citizens living abroad as the people born in the U.S. plus those born abroad from a parent who was born in the U.S. This is an admitted simplification, as it includes some people who are not U.S. citizens (born in the U.S. from foreign diplomats, or born abroad from American parents who did not reside in the U.S. for enough years to transmit U.S. citizenship, or who renounced U.S. citizenship) and excludes some people who are U.S. citizens (naturalized U.S. citizens and their children born abroad). But there is no data available to estimate these particular cases, their numbers are thought to be relatively small, and they partially compensate each other.
Mr. Pinto estimates that the following are the 10 most populous countries:
| Country | Number of Americans 2015-2020 |
| Mexico | 1,089,368 |
| Canada | 877,130 |
| United Kingdom | 371,674 |
| Israel | 243,772 |
| Germany | 198,125 |
| Australia | 190,788 |
| South Korea | 120,429 |
| Italy | 94,941 |
| France | 94,473 |
| Japan | 87,967 |
Although Mr. Pinto’s total number is quite similar to that of the FVAP, the country breakdown is different. Canada, the U.K. and Israel are pretty close, but Mr. Pinto’s Mexico number is much higher and his France number much lower than the FVAP’s. Mr. Pinto’s data also shows that a large number of children born in the United States of Mexican parents return to Mexico, which partially accounts for his larger number. Mr. Pinto’s estimate also does not include military personnel or their families.
Three Other Estimates: Ranging from 5.1 to 9 Million!
American Citizens Abroad: The American Citizens Abroad estimates that, as of 2022, there were 5.1 million U.S. citizens abroad, comprised of 3.9 million U.S civilians, plus 1.2 million service members and other government-affiliated Americans. See ACA Article. ACA’s estimate is based on a private study which they commissioned. We have not seen this study, nor do we know the methodology used or the assumptions taken.
World Population Review: The World Population Review (WPR) is an independent for-profit organization committed to delivering up-to-date global population data and demographics. The WPR estimates that, in 2023, there are more than 8 million expats today living overseas, See World Population Review. However, the WPR provides no data nor methodology describing how they reached their numbers.
Democrats Abroad: The Democrats Abroad organization has informed us that their official position is currently the State Department number of 9 million.
We do not know of any other groups or organizations who have developed, communicated or supported an estimate.
Estimating the Number of Americans Abroad is Difficult
Ultimately, there will always be a level of uncertainty about the true number of overseas U.S. citizens because actual numbers of Americans living abroad are either unavailable or unreliable.
There can be no precise official estimate:
Individuals who travel or live abroad can register with their local embassy, but no official registry is kept. Registries that do exist include citizens on short-term travel as well as long-term relocation, and there is no process to remove people from the list who have returned to the United States.
The U.S. Census Bureau piloted a program in 2004 to assess the feasibility of including overseas citizens in its decennial census, but the study found that full implementation would be prohibitively expensive and the data quality would not be sufficient. So, overseas Americans are not included in any U.S. census (overseas military and federal personnel, however, are included in the U.S. census, as discussed below).
That is why one must estimate the number of Americans living abroad. But this is complex and tricky, as you can see from the wide range of numbers in this article. We do not know the methodology used, nor the data behind, several of these estimated numbers. Further, much is necessarily based on older data.
AARO’s View: At Least 5.4 Million
Because AARO has had some access to their methodologies and underlying assumptions and finds them credible, and because their numbers are quite similar, AARO supports the FVAP’s and Mr. Pinto’s 4.8 million number as a starting point. As this number is based on data generally from 2018, it will have to be adjusted to account for overseas population growth since then.
How to do that? The FVAP data show that the U.S. overseas population increased 15% in the six years between 2012 and 2018 and 11% in the four years between 2014 and 2018.
We have assumed a 13% increase in the overseas population from 2018 to 2023 by extrapolating from this FVAP data. Applying this percentage to the FVAP’s and Mr. Pinto’s 4.8 million number, AARO believes that the number of Americans living overseas in 2023 would be at least 5.4 million.
As mentioned above, neither the FVAP’s nor Mr. Pinto’s numbers include U.S. military personnel living overseas, nor their families. AARO believes that, based on certain government data, between 200,000 (Note 4) and 350,000 (Note 5) military personnel and their families live overseas. If one were to add these people, AARO’s estimate of 5.4 million Americans living abroad would reach 5.6 to 5.7 million.
But AARO prefers to take the conservative view and support the lower 5.4 million estimate because many active-duty military are on US military bases or ships (i.e., not considered residents of the other country) and are assigned abroad temporarily. Further, being federal employees, they are usually not affected by the same problems that civilian Americans abroad face.
No matter what number one chooses, if all Americans overseas were placed in one state, they would be a formidable force:
Using the State Department number of 9 million, we would be the 12th most populous state in the U.S. (right between New Jersey and Virginia)!
Using AARO’s more conservative number of 5.4 million, we would be the 23rd most populous state in the U.S. (right between Minnesota and South Carolina)!
Living Overseas is Difficult for Americans
No matter how many we are, Americans who have moved overseas face legal and regulatory impediments that make life abroad difficult, such as:
Reporting for FATCA and FBAR is tedious, redundant and expensive.
U.S.-based financial institutions and banks refuse to deal with Americans living overseas, often cancelling accounts with little notice.
Overseas Americans are caught between two conflicting tax systems, the mandatory U.S. and the country where they live.
Saving for retirement is difficult, if not impossible, due to conflicting requirements, taxed investments, and onerous reporting.
AARO has advocated for changes to U.S. laws and regulations that fail to respect the American values of equal protection and due process, so as to permit overseas Americans to live ordinary lives like resident Americans. See here for AARO’s recent advocacy submissions.
Endnotes
Note 1: The OCPA compiles data from many different sources to create statistical estimates of what a government census of the number of U.S. citizens in each of 186 countries would be. These sources include registries and censuses kept by foreign governments, administrative records from U.S. agencies (e.g., foreign income tax filers, social security beneficiaries, civilian government employees, students), and a set of country characteristics that may affect immigration to or from that country. See Frequently Asked Questions, No. 7 in FVAP Website. (Return)
Note 2: See Frequently Asked Questions, Nos. 13 and 14 in the FVAP Website. (Return)
Note 3: Mr. Pinto is interested in international topics and, in particular, human migration and how laws vary between countries. He has researched the subject of citizenship-based taxation extensively, and has written several proposals, essays, comments and analyses, including an essay in 2017 entitled “Constitutionality of Citizenship-Based Taxation,” arguing that citizenship-based taxation violates the U.S. constitution as a form of invidious discrimination. (Return)
Note 4: The 200,000 number comes from Defense Manpower Data Center (DMDC) data: The data for September 2022 is the most recent and complete. We subtracted the persons living in the U.S. territories from this data, and arrived at 199,678 overseas military personnel. (Return)
Note 5: The 300,000 number comes from 2020 Military Census Data: The total overseas population in the census of 350,686 includes U.S. military and their dependents living with them overseas. as well as federal civilian employees and their dependents. The federal civilian employee number (around 30,000) is insignificant for our analysis. See also the OPM US Federal Workforce Data. (Return)
