Financial independence is the status of having enough income to pay one's living expenses for the rest of one's life without having to be employed or dependent on others.


With this mind, let's explore the levels of financial Independence.

With each level comes more freedom and economic stability.



Level 0 – Financially Struggling

Most people have experienced what it’s like to struggle with money.

Struggling with money is horrible. It creates constant background anxiety that lessens our enjoyment of everything.

When you’re in the struggle stage , it can feel like your hard work isn’t getting you anywhere.

You work every waking hour, yet still barely manage to cover your bills.

And to make matters worse, you might also have debt that’s growing at an alarming rate.

People at level zero have zero assets, zero passive income and often have a negative net worth .


Level 1 – Financially Stable

The next level up is when you’re making enough to get by.

You’re still living paycheque to paycheque, but you’re surviving. The wolves are no longer at the door.

Spending everything you earn is now a choice.

Saving at this point will require a lot of discipline.

The best thing you can do for your finances at this stage is to create a budget.

Get good at managing your money, look for ways to save more, and pay down bad debt.

Build a small emergency fund that will stop you from going into debt for unexpected financial emergency.

At this level,the need for Investment on personal finance books cannot be underestimated.


Level 2 – Financially Comfortable

By the time you’ve reached level two, your financial house in order, you’ll probably relax a little.

You will be able to live a comfortable life.

You’ll buy a house and a nice car. Then you’ll buy a bigger house and a nicer car.

With no immediate financial threats or incentive to save hard, people remain at this level for years, decades even, and sometimes for the rest of their lives.


To catch the concluding part of this article stay glued to this page on our Friday financial wellness series.


Cheers to your continuous financial wellness.


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© Olubusayo Akin-Akinbode
Real Estate and Investment Consultant