Indie game development is pretty much the same as any other "artistic" type of career. This is going to sound rude, but I've found it an apt metaphor. Please don't take it personally, it's just sort of the nature of any business based upon gaining money from Subjective Personal Opinion.
"A few winners, a whole lot of losers".
Rock Stars, Actors/Actresses, and Famous Painters have proven it can be done. You can become absolutely rich beyond your wildest dreams. But, if we take a look at how few there are compared to the rest of the populace, then you'd realize that these people are the exception rather than the rule. How many failed bands exist? Failed painters? Failed actors/actresses? I'd wager its about the same amount as people who have failed at making any kind of living making video games. Even among the AAA industry, there are a lot of "flop" games that just don't even make their production costs back.
Basically, I know what you're asking with your question, but I suspect you already know the answer to it. You're asking "Can I live comfortably off of my funds if I work hard enough?" Maybe. Food expenses, bills, gas for a car, clothing, rent, taxes, etcetera all play a role in how well you could live on any given amount of money. I live "comfortably" on $17,000 a year, which leaves a little leftover for new games or unexpected expenses (like fixing a car, replacing broken things, etcetera). But, let's put that in perspective. If you sell a single game for $20 a pop (I'm using what qualifies as the "Discount Game" prices here in stores... Basically games almost nobody buys, and they're sold so cheaply just to get rid of the stock) then you would have to sell 850 copies of your game in a year to live on that "comfortably" position of $17,000. You'd have to sell nearly two and a half copies a day, the entire year, to make that kind of money. To put that further in perspective, there are games on Steam Greenlight that don't sell that well. Even very good games on Steam Greenlight that don't sell that well. Even before the return policy.
If you're truly serious about trying to live off of the money you would make via Indie Development, then I wouldn't concentrate on the money side of things first. The first thing you'll want to concentrate on is learning game mechanics, learning some programming (or at least some neat tricks you can do with the engines this website has as a means of making games), and getting good, but cheap, custom content for games. Your first few games are going to want to be given away. You are most certainly going to eat those costs and they might be more expensive than you're willing to give a game away for. But, that's kind of how it has to go. Most people will try any game for free. They paid nothing for it, so any value they get out of it is a net profit for the consumer. This is also a good marketing campaign. If your first few games end up being at least decent and you've got at least a couple hundred players, then you've essentially cemented into their minds that you can produce at least decent content. Plus, you can do it cheaply to the consumer. Also, these first few games that you create and give away are learning experiences for you. They are how you will learn to deal with feedback from players as well as how to fix all the problems that inevitably arise with the public release of a game (bugfixes, finding places to host the game for download, etcetera). I'd say that once you reach at least a few hundred players of your free games and feel confident enough to try to charge people for your product, you should go with one of two systems. Donations to keep you going (this is somewhat risky, but if your content is amazing, people are more than willing to toss $5 your way every so often just to keep you going) or small amounts of cash. I'd charge $3-$5 a game at that point. Generally, less will be better (you're still going to be eating your costs at this point, but at least you'll be making some of those costs back, and you'll have kind of an installed playerbase from your previous free games who might be willing to toss you that money just to see what you've done next), but try to avoid going over $10 and under $3. You need to make some of your money back, especially as the quality of your game-making goes up (and your contact lists go up). Make a few games at these low prices and make sure they're not shovelware, your goal in these priced games is to get a 50% review rating. As in, half your customers like the game and the other half think it needs work.
Once you hit that 50% mark, you could try making a longer, prettier, better game that you would try to sell in the $10-$15 range. Your installed playerbase should be much larger by this point, and hopefully you've been doing some marketing and keeping players in the loop about your new project. Hype is helpful, but try to keep your hype realistic so that players don't feel burned or lied to when they get your new project. Your goal in this price range is simply to make back the money you spent creating it. That means you're going to spend time budgeting and doing spreadsheets, but that is vital. If you can create a game that earns back all the costs that were put into it in say... a year or less, then you are well on your way to making games you can charge $20 for. Through all these first steps here, however, you will need an 8 to 5 job to keep you fed, clothed, and flush with essential items for living comfortably.
If your $15 game makes back more than you spent on it in whatever time frame you had (I suggest six months to a year), it is now probably time to work on your $20 game. This is a huge step and you cannot afford many, if any, mistakes. You're now charging $20 for a game without being a "big time developer". You're still Indie. Somewhat more well-known by this point than most, but still an Indie. Your first goal with your first $20 game is to make a 25% profit off of it. That means, if production costs were $10,000 in two years, you should be making $12,500 from the sale of that game in six months or a year (the shorter the time frame the better, the longer the worse, if it takes you several years to make back what you spent, or over a single year, I suggest going back to previous steps until you've built up enough fanbase and consumer confidence to try this step again). It will take you a lot of time to make a 100% profit from $20 games, but if you can average at least a 5% larger profit from each new $20 game after the initial 25% profit of the first game, you're well on your way to making it to the next step.
Okay, so now you might be making that 100% or more profit on each $20 game you make. If you're at this point, congratulations, that's quite a feat! But, what's important about that, is now you've got most of the systems in place to at least get players into your new project. You probably even have mechanisms in place for marketing to get even more new customers (or at least new eyes on the product). This is the point in which you are going to aim for "live comfortably from making games". Hopefully, you've been investing all that profit from the $20 games back into making new games (yes, you should keep that money separate and you should not spend it for personal use, because it will be invaluable for this step). If you have, you should now have a sizable pool of cash to work with when it comes to trying to make 300% profit from your $20 game. Yeah, you should probably still be making your $20 games. If you're good at it, they will sell, and they will sell very well (we're going to use Minecraft as the example, since it's so well-known. $20 game and the guy sold his company to become rich just based on how many sales he got of that game). Generally, I don't think you want to transition into a full $50 pricetag until you can pretty much guarantee a 600%+ profit from every $20 game you produce. I also don't suggest putting in "Micro Transactions" or other sorts of goodies like them until you're at the point where you'd make a $50 game. Unless, of course, your games stay free forever, and the only money you would ever make would be those goodies and micro-transactions. However, you may just want to skip the "goodies" and "micro-transactions" altogether, as very few ever do them right.
So, if you're making 300% profit on a $20 game in a year, you should now be living "comfortably". At least, if you live where I live. Please adjust dollar amounts for your local currency and local cost of living expenses. Ideally, at this point, you could probably quit your full-time job and either take on a part-time job or quit a job altogether. However, you will have to manage your money well, because if you make a game that flops, you might not have much income for a year, and living will be rough. This is one of the reasons you want to keep your profit separate from your "day job" funds. You should probably also check with local tax collectors on if you owe anything on your profit (like if you're a business) and how much that could be. This might be a bit trickier if you have your profit put into a "Business Account" instead of just your standard savings/checking accounts. There are plenty of places out there that would give you some free advice on how to manage such money for taxes. But, if you're asking for loopholes and how exactly it's paid... Well, you might have to hire someone to do those taxes for you. Just keep that in mind. Anyway, from this point on, you should be doing everything possible to make more and more profit from each game you create, and doing it much more quickly. You're going to be "living comfortably" for quite some time and having to micromanage your money. Yes, even if you're making back 600% of what you put into the game in less than a year. A single flop at that point, can rob you of the funds you need to simply live. Save money where you can and try not to blow all the profit from each game on the next one. Until you're pulling down what amounts to $50,000 a year in your own currency, you shouldn't be trying to make "upgrades" to your life (like moving from an apartment to a house, new car, etcetera) because a game that flops can quickly make these situations horrifying to be in. Even more importantly, you need to be getting paid while you're developing new games. Up until this point, you should be assuming one game every year or so. As in, creating and completing a game every year. Until you're pulling down good chunks of money without a job, there's no way you could turn development time into more than a year. So, honestly, at this point, it's about getting your games to the point you can live comfortably and afford an upgrade or two to your life every so often without the threat of going broke when a game flops.
After that, all you're shooting to do is make enough profit from your games that you can either increase their price tags and nobody bats an eye, or that you can take a few years off from game development if you need/want to. This buffer also helps if a game or two flops. From there, it just gets more complicated, but at least you're on your way to no longer being an Indie Developer.
Anyway!
I know this is really long. So, if you just scrolled down this far and didn't read it, I understand. I'll give you the tl;dr section right here. I'm a very part time Indie developer guy who has never sold anything or even published a single game in the two years I've been here. Take my advice with a grain of salt as I probably have no idea what I'm talking about. However, all the advice I've listed is what my own plan has been for Indie Development. It is how I planned to go about it, and how I planned to do it from the start. Barring unforeseen circumstances (like me not knowing what I'm talking about), it would remain unchanged. But, if you must ask someone good and proper steps for how you should go about the process, I suggest the people who are "living comfortably" on their game sales. They could tell you better than anyone what kind of hell they went through to get to that point as well as the mistakes they made and what some of the best decisions they made.
If you want to succeed, ask those who have succeeded. If you want to fail, ask those who have failed.
