Financial freedom is not an all-or-nothing scenario. It is a journey. The stages have several ups and downs, and you need t cross all those scary and messy paths to reach the stage of abundance and full financial freedom. You cannot just rush or skip any of these levels. One needs to experience and learn from each of these stages to make the freedom available. The very beginning of this course starts from dependency. Here, we are going to read about the levels of financial freedom.

The Levels of Financial Freedom – Top 6 Remarkable Stages


The very first level of financial freedom starts with meeting your financial obligations without any requirement of help from others. Even if you have a negative net worth or big debts, you are solvent if you manage to cover your pay and the full cost of living. The freedom in this stage is limited. However, if you spend whatever you are earning, there’s no way you can reach the next level. You can only make progress and grow your financial status if you earn more than you spend.

The Levels of Financial Freedom – Top 6 Remarkable Stages
The Levels of Financial Freedom – Top 6 Remarkable Stages


The second stage is where you have adequate cash for emergencies and no debts. Your income is more than your basic expense of living and has little cash to spend on your weekly or monthly expenses. Because your emergency requirements are taken care of, you have the freedom to take small risks of spending some cash sometimes. This is the time you should think about what you are going to do with your excess income. Several people stop and live at this level for the rest of their life. This is the time for saving and investing your excess income.


At this stage 3, you have organized and built up a significant savings pile and investment portfolio. Your excess income is being saved and invested, however, your assets are growing and input is adding to your net worth. In this stage, you have an abundance of flexibility and freedom. As your investment income grows, the requirement for personal earnings shrinks. This gives you more opportunities to live as you please and organize your own life. However, it is important to remember that work is still very much needed in this stage. You want your living expenses to be covered, right? Keep working!

The Levels of Financial Freedom – Top 6 Remarkable Stages
The Levels of Financial Freedom – Top 6 Remarkable Stages


Security is considered the first step toward financial independence. It is the level where your income is capable of taking care of living expenses. You don’t have to work anymore for your necessities. However, there is no room for luxury and careless expenses. When people reach this point, all they want is to travel, pursue new hobbies, buy expensive things, share their wealth, and live the life they have always imagined. To be able to do all of those things you need to reach the next stage.


Independence is something we all seek since we come to senses and be aware of society and relationships. Firstly, it was the freedom from parental guidance and growth as an individual. Secondly, comes academic freedom, which is considered the hardest part. This stage determines our profession, bank balance, and in a way the rest of our life. Lastly, we seek financial independence. By this point, we are somewhere between 30-40 and we all want to live life on our terms. Buy whatever we want and travel wherever we want without thinking about the bank balance. In this stage, your investment incomes cover your living necessities.

The Levels of Financial Freedom – Top 6 Remarkable Stages
The Levels of Financial Freedom – Top 6 Remarkable Stages


By this point, your investment portfolio is making more bucks than you require in your life. However, the gap between the things you have and the things you need will keep growing over time. In this stage, you have the power to make decisions in life based on your choice and happiness. You can give back, help and share, or set up long-lasting wealth for the future generation.

Financial freedom is not a competition. Take advantage of your freedoms in the here and now! We are all striving for independence and abundance. You must be aware of which stage you are in, and grow and build yourself accordingly. Remember, you don’t have to rush, if you are consistent and hard-working you will eventually reach stage 6. Good luck!

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