Standard of Living vs. Quality of Life

Standard of living refers to the level of wealth, comfort, material goods, and necessities available to a certain socioeconomic class or geographic area. Quality of life, on the other hand, is a subjective term that can measure happiness.

The two terms are often confused because there may be some perceived overlap in how they are defined. But knowing the different nuances of each can affect how you evaluate a country where you might be looking to invest some money.

Standard of living is a comparison tool used when describing two different geographic areas. Metrics may include things like wealth levels, comfort, goods, and necessities that are available to people of different socioeconomic classes in those areas. The standard of living is measured by things that are easily quantified, such as income, employment opportunities, cost of goods and services, and poverty. Factors such as life expectancy, the inflation rate, or the number of paid vacation days people receive each year are also included.

Other factors commonly associated with the standard of living include: Class disparity, poverty rate, quality and affordability of housing, hours of work required to purchase necessities, gross domestic product (GDP), affordable access to quality healthcare, quality and availability of education, incidence of disease, infrastructure, national economic growth, economic and political stability, political and religious freedom, environmental quality, climate and safety

The standard of living in the United States may be compared to that of Canada. It may also draw comparisons to smaller geographic areas such as New York City versus Detroit. It can also be used to compare distinct points in time. For example, the standard of living in the U.S. is considered to have greatly improved compared to a century ago. Quality of life is a more subjective and intangible term than standard of living. As such, it can often be hard to quantify. The factors that affect the overall quality of life vary by people's lifestyles and their personal preferences. Regardless of these factors, this measure plays an important part in the financial decisions in everyone's lives. Some of the factors that can affect a person's quality of life can include conditions in the workplace, healthcare, education, and material living conditions. The United Nations' Universal Declaration of Human Rights, adopted in 1948, provides an excellent list of factors that can be considered in evaluating quality of life. It includes many things that citizens of the United States and other developed countries take for granted, which are not available in a significant number of other countries around the world. Although this declaration is more than 70 years old, in many ways it still represents an ideal to be achieved, rather than a baseline state of affairs.

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