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The concept of “a comfortable living” has undergone a profound transformation. While income levels have nearly doubled since 1997, what constitutes comfort has shifted dramatically, raising important questions about how we define and achieve financial well-being in modern America.
In 1997, the average American income was approximately $30,250, with a median income of $37,000. Fast forward to 2024, and average incomes have nearly doubled, though median incomes haven’t kept pace, revealing a widening disparity in earnings across the population according to data from the Bureau of Labor Statistics. This divergence prompts us to reconsider what level of income truly creates a comfortable lifestyle today.
MIT’s Living Wage Calculator proposes that comfortable living entails the ability to live on 50% of one’s income, save 20%, and allocate 30% to discretionary spending. By this standard, residents of West Virginia earning the state’s average income of $39,770 would need $89,461 to live comfortably. This gap between actual and required income for comfort exists across numerous states, highlighting a nationwide challenge.
But maybe our understanding of comfort needs recalibration. True comfort goes beyond numerical calculations and materialistic pursuits. It encompasses contentment – not to be confused with complacency. Contentment is the delicate balance of appreciating what we have while maintaining ambition to increase productivity and profitability. It’s a mindset that allows us to find joy in our current circumstances while working toward sustainable financial growth.
Examining the evolution of what constitutes “comfortable living” reveals striking changes over recent decades. Many conveniences we now consider necessities were luxuries just forty years ago. As of January 2024, nearly 90% of American homes feature central air conditioning, a dramatic increase from 1980 when 43% of homes had no air conditioning. Our expectations regarding transportation have similarly expanded, with the average household now owning two vehicles compared to the single-car norm of the 1980s.
Housing expectations have undergone the most dramatic transformation. The average American home measured 1,595 square feet in 1980; by 2018, this figure had grown nearly fourfold to 6,295 square feet. This expansion highlights heightened expectations of what constitutes adequate housing.
Despite these material improvements, an interesting paradox emerges. Despite fewer modern conveniences, Americans in the 1980s reported higher levels of happiness and contentment, with lower rates of depression and suicide than we observe today. This suggests that comfort and happiness may not correlate as strongly with material abundance as we might assume.
Ancient wisdom offers insights that remain remarkably relevant to our modern quest for comfort. James, the brother of Jesus Christ, addressed this very issue, observing: “You crave what you don’t have, you kill and covet, but are unable to obtain it. You quarrel and fight and you do not have because you do not ask. And when you do ask you do not receive because you ask with wrong motives, that you may squander it on your own pleasures.”
This timeless observation illuminates a fundamental truth: those who fixate on material acquisition often find authentic comfort perpetually beyond reach. The pursuit of money and possessions as ends in themselves rarely results in genuine satisfaction or comfort. Instead, it leads to an escalating series of desires that remain unfulfilled.
King Solomon, renowned for his wisdom, offered this insight: “One person gives freely, yet gains even more; another withholds and comes to poverty. A generous person will prosper, whoever refreshes others will themselves be refreshed.” This principle suggests that generosity – using our resources to benefit others – paradoxically enhances our comfort and well-being.
These ancient perspectives align with contemporary research on happiness and fulfillment. Numerous studies confirm that helping others reduces our own anxieties, fears, and stress, maximizing our comfort levels. Genuine comfort, it seems, emerges not from accumulation but from contribution – using our resources to create value for others.
In light of these insights, we might benefit from reconsidering the standard financial formulas for comfortable living. The common allocation of 30% of income to discretionary spending may undermine rather than enhance comfort by encouraging unnecessary consumption that fails to generate lasting satisfaction.
A more balanced approach might follow what we call the 10/20/70 rule:
This framework challenges conventional wisdom but offers a more sustainable path to genuine comfort. As financial mentor Gil Liming wisely advised, “always think in percent financially.” Paying 30% more than necessary (as in the credit card example) undermines your ability to establish a comfortable living.
While mindset and allocation strategies form the foundation of comfortable living, specific financial tools can enhance their effectiveness. Dividend-paying whole life insurance is one such instrument, creating additional cash reserves that can be deployed to meet personal needs and opportunities to assist others.
Unlike many financial products, properly structured whole life insurance provides multiple benefits aligned with comfortable living:
The strategic use of such financial tools amplifies the effectiveness of your allocated savings, allowing your wealth-building portion to work more efficiently. This approach exemplifies the principle of making your money work harder rather than working harder for your money.
Implementing the 10/20/70 framework initiates a positive financial trajectory. As non-productive debt diminishes through the dedicated 20% allocation, those funds gradually become available for other purposes. Once your non-performing debt is eliminated, you can redirect that 20% toward wealth building, tripling your capacity to save and invest.
This progression creates accelerating financial momentum. Your initial 10% wealth-building allocation establishes foundational security. As debt diminishes, the redirected 20% increases your ability to build assets and generate passive income. This growing asset base produces additional income, enhancing your financial capability.
The beauty of this approach lies in its self-reinforcing nature. Each step creates resources that make subsequent steps more powerful. Eventually, the assets you’ve accumulated generate income that can supplement or even replace employment income, providing financial freedom and maximum flexibility in how you allocate your time and energy.
Implementation of these principles requires acknowledgment of current economic challenges. As the document notes: “Not all incomes are uniform nor are all incomes increasing as rapidly as prices are increasing.” This observation highlights the importance of personalized financial strategies that account for individual circumstances.
Inflation represents a particular challenge to comfortable living. When prices rise faster than incomes, maintaining lifestyle quality requires either increased earnings or enhanced efficiency in resource utilization. Strategic wealth management becomes even more crucial in such environments to preserve purchasing power and maintain comfort.
For those facing income constraints, creative approaches to the 10/20/70 framework may prove necessary. This might include:
The main principles remain valid even when implementation requires adaptation. The goal remains establishing sustainable financial habits that promote genuine comfort rather than always striving for more.
Beyond numbers and strategies, comfortable living encompasses psychological well-being. Financial stress ranks among the biggest contributors to overall anxiety and relationship difficulties. Addressing this dimension requires objective financial progress and subjective perception management.
Comparing ourselves to others undermines contentment regardless of absolute financial position. Social media amplifies this tendency by presenting curated glimpses of others’ lives that rarely reflectthe complete reality. Focusing instead on personal progress relative to your own past circumstances yields greater satisfaction.
Financial decisions impact comfort beyond their monetary consequences. Spending aligned with personal values generally produces greater satisfaction than purchases motivated by social comparison or momentary impulse. Similarly, investments that support causes or companies you believe in often provide psychological returns beyond financial performance.
True comfort emerges from the alignment of your financial reality with your values and aspirations. This alignment creates coherence between what you believe matters and how you allocate resources, reducing cognitive dissonance and enhancing overall well-being.
Financial comfort surpasses individual or family boundaries. As noted earlier, helping others through financial means enhances personal comfort. This principle applies at community levels as well, where financial wisdom shared and practiced collectively creates resilience that benefits all members.
Financially stable individuals have a greater capacity to volunteer, contribute to community initiatives, support local businesses, and assist neighbors during difficulties. These contributions strengthen social bonds and create informal support networks that enhance everyone’s security and comfort.
Financial education represents a particularly valuable form of community contribution. Sharing knowledge about effective money management helps others avoid costly mistakes and implement effective strategies. Such education creates ripple effects as recipients apply principles, improve their circumstances, and share wisdom with others.
A comfortable living ultimately transcends simple financial metrics. While adequate income provides necessary resources, true comfort emerges from the thoughtful application of those resources in alignment with enduring values and principles.
The 10/20/70 framework offers a practical starting point for this journey, providing structure without rigidity. As your non-productive debt diminishes and eventually disappears, your capacity for wealth-building expands dramatically. Strategic tools like dividend-paying whole life insurance can accelerate this progression by providing tax-advantaged growth and flexible access to accumulated value.
Throughout this process, maintaining perspective remains essential. Contentment with current circumstances, even while working toward improvement, provides psychological comfort that material acquisition alone cannot deliver. Using resources to help others enhances rather than diminishes personal comfort, creating positive cycles of generosity and refreshment.
In an era of constant change and economic uncertainty, these principles provide stability and direction. They enable you to thrive – finding genuine comfort amidst life’s challenges and opportunities. By balancing prudent resource management with generous contribution, we discover that comfort emerges not from how much we have, but from how wisely we use what we possess.
McFie Insurance is here to help and guide you on your journey to making a comfortable living. Whether through structured financial tools, educational resources, or personalized guidance, professional assistance can accelerate your progress toward genuine financial comfort. The journey may require patience and discipline, but the destination – a truly comfortable life characterized by material sufficiency and personal contentment – rewards every thoughtful step along the way.
Tomas P. McFie DC PhD
Tom McFie is the founder of McFie Insurance and co-host of the WealthTalks podcast which helps people keep more of the money they make, so they can have financial peace of mind. He has reviewed 1000s of whole life insurance policies and has practiced the Infinite Banking Concept for nearly 20 years, making him one of the foremost experts on achieving financial peace of mind. His latest book, A Biblical Guide to Personal Finance, can be purchased here.
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