Managing Debt

The New American Dream: Getting Out of Debt

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What does the American Dream look like today? For a quarter of American adults in a new Credit.com survey, the answer is simple: it’s being debt-free.

Retiring financially secure at age 65 was the most popular response to the question, “Which of the following financial goals most closely represents the ultimate American Dream for you?” with more than a third of respondents (36%) choosing that option. The next most popular response? A quarter of respondents picked “being debt-free” as their definition of the “American Dream” in the 2014 Credit.com American Dream Survey, which will be released next week.

Other responses included owning a home (17%), joining the “one percent” (5%), graduating from college (3%) and paying off student loans (2%). Eleven percent of respondents chose the answer “something else.”

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I Can Do It, But Maybe You Can’t

Whatever the dream, the majority of respondents were largely optimistic they can achieve it themselves, but significantly less confident that most others can. These findings confirm a similar survey conducted last year on behalf of Credit.com, where the top definitions of the American Dream included retirement and freedom from debt. In that survey, like this one, most were more optimistic about their own prospects than those of most other Americans.

Of course these top two goals most respondents identified in both surveys go hand-in-hand. Being debt-free may very well be a vital step toward a financially comfortable retirement.

Consumers can start now by checking their free annual credit reports and by using free tools on Credit.com to check their credit scores, then using that to map out a plan. Here are five steps to get out of debt. Achieving these milestones will require sacrifice and hard work, but reaching the goal of being free from debt can be well worth it.

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Image: Chris Rogers; Graphic by Credit.com

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