(First appeared in USA Today)

When your favorite television show goes to commercial, one might get the impression the entire country is millionaires. We drive amazing cars, we all have high definition curved televisions, and even if we have a serious medical condition which can fortunately be treated by a strange-named drug with heinous side-effects, we’re still living an opulent life of sail boats, cashmere sweaters, and personal antique bathtubs on a mountainside. You can’t help but to feel inadequate. Not only can the average person not afford most of the wares being hawked on television, but if they even tried, their future would be worse than the side-effects which, again, sound worse than the actual medical ailment you’re hoping to cure.

According to Census ACS data from 2016 (the most recent available), the median household income in the United States is $68,260. You gotta wonder what a life on $68,260 looks like. Fortunately for you, I’m currently obsessed with crafting financial lives based on vastly different income levels.

We have to start with a pile of excuses, disclaimers, and caveats. The life of a 25 year old single woman living in Tulsa earning $68,260 is much different than a 40 year old married couple with six children living in San Diego on the same income. I know that if you’re paying-down debt or if you have huge day care expenses, the numbers you are about to read will seem ridiculous. The point of this exercise isn’t to debate nuance. It’s to put the pop-culture socio-economic narrative in its proper place.

I can’t emphasize enough how important it is for you to not focus on how different my example is than your life, throw your hands up in frustration, and move about your day. You may have never seen what your financial life is supposed to look like until this very moment. To say it’s shocking, would be an understatement.

Your income must not only fund your present life, but it must fund your past and your future too. In our example, Barry and Carrie don’t have any student or consumer debts, but like everyone else, they must save for their future. Therefore I’ll show you a life in which they acknowledge their future, and a life in which they don’t. The childless couple lives in Texas, are both 35 years old, and spend $5,000 annually on pre-tax health insurance. I’m not going to project income increases for this couple over the next 32 years, outside of cost of living pay increases, which will in fact cover cost of living increases.

The first path for Barry and Carrie is one with an eye on the future. They choose to defer ten percent of their pay to an employer sponsored retirement plan (401k), which has no employer match. Their contributions to their retirement plan will grow to $1,009,080 by age 67 (calculated with an 8 percent annual rate of return).

The net (take-home) pay for Barry and Carrie each month is $3,490.

This next part is wildly important. You can either spend what someone allows you to spend on major expenses, or you can spend what you can truly afford. The difference between those two concepts is the difference between thriving and surviving. Barry and Carrie can afford a mortgage/rent payment of $872, total transportation cost of $523, and monthly food expenses of $418. They should save $349 for emergencies or other non retirement savings and allocate $349 toward utilities each month. Next, they should spend $174 per month on the following expense categories: entertainment, clothing, medical, holidays/gifts, and charity. Finally, $104 per month is available for miscellaneous expenses.

Yes, there are lots of expenses missing. That’s the entire point of the exercise. You can’t push the limits of housing and transportation affordability, and still expect to have money leftover for vacations, falconry lessons, and trips to Target or Wal-Mart.

Of course, Barry and Carrie have the opportunity to navigate an alternate path. If they choose to ignore their future, they can increase their take-home pay to $4,058 per month. The allocations shift accordingly: mortgage/rent $1,014, transportation $608, food $486, savings $405, utilities $405, then $202 per month each for entertainment, clothing, medical, holidays/gifts, and charity, and finally $121 per month for miscellaneous.

Don’t forget, the second path leaves Barry and Carrie with a $0 nest egg at retirement. Also knows as a goose egg nest egg.

I urge you, don’t make this exercise about yeah buts and gripes about my assumptions. If you spend more on a particular category, fine. Just be sure to reduce the amount you spend on a different category. After you the sift through the numbers and collect yourself, you’ll quickly realize my point about advertising. If you’re the median American household, you can’t afford half the things you think you need.

I’ve taken the liberty of breaking down several different household income levels. You can see very detailed breakdowns at PeteThePlanner.com/blog. What you’ll find is that it’s possible to become a millionaire at just about any household income level, but it requires you to live a disciplined financial life. And you’ll learn something else – it’s possible to waste a crippling amount of money, no matter how much money you make.

Pete the Planner®

Peter Dunn a.k.a. Pete the Planner® is an award-winning financial mind and a former comedian. He’s a USA TODAY columnist, author of ten books, and is the host of the popular radio show and podcast, The Pete the Planner Show. Pete is considered one of the foremost experts on financial wellness in the world, but he’s just as likely to talk your ear off about bass fishing.