A couple of decades ago, life seemed to be well planned out. You would go to school, get a good job right after school, and get yourself an affordable mortgage. If you are good with finances, then you will have enough income to save some of it. However, that has changed a lot over the years.

Before we can talk about how life is not as it used to be before, we have to look at the life of millennials. For most millennials, they were sold the idea of the American Dream. However, it seems like the dream is no longer attainable. Some even feel it was a lie all along, but we have to understand that a lot has changed, especially in terms of economy.

We do not want to crash any dreams that millennials have about the American Dream, but it is time we got real. Your college degree is not going to be enough anymore. In the past, having a college degree guaranteed a good job, however, that has largely changed right now.

There are things that made the life of our parents easier and better for them to live off their salaries and even make investments. Below, we look at some of the things that made their American dream attainable and why it does not work right now.

The average income

Most parents must have told their kids that the only way to succeed in life is through going to college and getting a degree. However, once the kid graduates and there is not much for them to do, he or she can start to question if the degree was worth it all along.

As much as getting a college degree is important, the first thing you rack up while in college is the student loan debt. Paying off such a loan is not always the easiest thing for most struggling graduates.

We have to look at the average income that such graduates will be making. The starting salary is $50,000 per year for a graduate. Many might be surprised about others complaining about such a figure. However, when you break it down to a monthly salary, it is $3,200. Considering the taxes and costs of living are on the rise, then you will find this amount shrinking even further.

When the cost of living keeps on rising faster than the wages, then you end up with people struggling to meet their obligations.

The recurrent expenses

There is no doubt that the monthly expenses can take up a huge chunk of your paycheck. If you are not careful, you might not end up with anything left for saving. Below, we want to look at some of the common expenses that fresh graduates out of college are likely to face.

Paying for student loans can amount to $280 per month. On average, a college graduate will have a student loan debt of $25,000. This was taken to help the student get a degree that is supposed to open doors to a better career. However, some have to pay a lot more money in terms of student loans immediately after school. If you want to clear your student loan debt in 10 years, then a payment of $280 per month is necessary.

Health insurance will take up to $320 per month. Not all people get the government subsidy to help with their health insurance costs. As such, they have to part with the amount mentioned above. It looks like a lot of money to pay for something you might not use, but it is better to have medical cover as you never know when you might need to use it. The last thing you want to do is pay the exorbitant medical costs.

The average rent or mortgage payments for those fresh out of college will be around $895. As such, this amount of rent will take up a huge percentage of their income. This is even assuming you can afford to get a house in the first place.

If you decide to get yourself a car for commuting to and from work, then you are looking a car payment of $295 monthly. This can also vary depending on the type of car that you decide to choose. In addition, there is $75 monthly for car insurance. You need the car insurance to drive around safely.

Still, as part of car expenses, you are looking at $205 per month for gas. If the gas is too expensive for you, then you might decide sometimes to take the public transport and use the car only when necessary.

Any person who has a house will also have to deal with utilities. Depending on the various amenities you need to use, the utilities can take up to $240 per month. If more people have to start staying in the same house, then expect the utility bill to go up.

Remember that you still have to keep your belly full too. It is why you need about $480 per month for food only. Considering that many people right now like to eat out, then the food bill might even be higher.

Credit card payment is around $60 per month. Because most people would need credit cards until the next paycheck, you are likely to get one for yourself.

It is good to maintain a good social life, so you would want to consider some entertainment money too. On average, you can spend about $200 per month on entertainment.

We cannot forget about the miscellaneous expenses. Such expenses will take up an average of $250 per month. This is the money you never budget for something specific, but it should be available just in case you need it.

If you add up all the expenses mentioned above, you are looking at a total of $3,300 each month. Keep in mind that there are still a few things we have not included in the list.

So, What Next?

As you can see from the expense’s breakdown above, it is easy to see that it would be hard to have a successful future. You will be spending most of your income on paying the expenses and likely to end up in more debt because the expenses are more than the income.

Unfortunately, people can easily get tempted to get more credit cards to offset some debts. However, these credit cards are still debts that you are accumulating. As such, you end up in a loop of endless financial constraints.

It is why many college graduates are looking for new and innovative ways to earn more money. Some can have businesses running parallel to their full-time job. As much as running your own business can seem intimidating, it can be your ticket to financial freedom.

If you are planning to start your own business, take the time to research more about the idea first to see if it is viable. Do not quit your job before the business is stable and profitable.