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A shaky economy, job uncertainty and rising everyday costs have Americans craving the financial independence that makes money worries a distant memory.
That might be why so many people are turning to author and personal finance expert Grant Sabatier’s seven-level breakdown for financial freedom.
Sabatier’s list is gaining attention because it ladders the distinct levels of wealth people reach on their path to prosperity. Understanding where you stand on the ladder can inform your steps toward the final rung: complete money freedom.
So, where are you on the ladder, and how can you keep climbing?
Level 1: Clarity
The journey starts by understanding your financial situation — your income, debts, and savings.
Today’s high grocery prices and everyday costs make basic living expenses a challenge. But it can be empowering to get an understanding of where you are financially speaking and how much you need to make ends meet. That’s how you build a plan.
How to climb: Begin by following every dollar’s comings and goings. Budgeting apps like Monarch Money can help you track your expenses down to the last penny, helping you figure out where your money is going.
You are probably overpaying for at least one unused subscription, and Monarch Money can help you identify it. According to a survey of 1,106 consumers conducted by Self Financial in 2023, 85.7% of respondents paid for at least one subscription that went totally unused.
Monarch Money’s expense tracking system makes managing expenses and debt easier. The platform seamlessly connects all your accounts in one place, giving you a clear view of where you’re overspending.
For a limited time, you can get 50% off your first year with the code NEWYEAR2025.
Level 2: Self-sufficiency
At this level, you no longer rely on anyone for financial support and can cover basic expenses. Reaching this stage means you’re paying the rent or mortgage, utilities, and other essentials without accumulating debt.
Living paycheck to paycheck, however, is still considered part of this step. A recent study by MagnifyMoney found that half of Americans are dealing with that reality.
How to climb: It’s important to build an emergency fund with three to six months’ worth of living expenses — a safety net to protect against lost income or unexpected expenses. It’s also important to minimize lifestyle inflation and keep expenses low as your income grows.
But you don’t need to contribute huge amounts of money to your emergency fund at once. With Acorns, you can automatically invest spare change from everyday purchases into a smart portfolio of ETFs.
If you want to handpick your investments, you can opt for Acorns Gold, which allows you to invest in individual stocks.
Plus, get a $20 bonus investment when you sign up with Acorns today.
Level 3: Breathing room
At this level, you’ve escaped the paycheck-to-paycheck cycle. Extra money allows discretionary spending. You’re no longer stressed about covering your monthly bills. Knowing your financial house is in order, you have enough to occasionally indulge in eating out, vacations and other non-essentials.
How to climb: Focus on erasing high-interest debt and increasing your savings rate. Prioritizing where your money goes ensures you’ll continue to build wealth while enjoying the results.
You can do this by consolidating your debt using a personal loan at a preferably lower interest rate. This way, you have to make only one payment every month, easing your interest burden.
Credible is an online marketplace where you can compare personal loan rates. You get offers from lenders near you all in one place so that you can make an informed decision to consolidate your debt.
The best part? Checking rates on personal loans through Credible is completely free and won’t impact your credit score.
Level 4: Stability
At this point, you’ve built a solid foundation. Day-to-day expenses and unforeseen emergencies don’t worry you. This level is about security and knowing that one unexpected bill won’t send you spiraling into debt.
How to climb: Maintain regular contributions to your savings and investments. Make sure you have the appropriate insurance policies (health, life, disability) to protect your assets and income.
While the national average rate on savings accounts is about 0.42% APY, according to the Federal Deposit Insurance Corporation (FDIC), several institutions offer significantly higher returns, up to 10x the median.
If you want to compare your options, check out our list of the Best High-Yield Savings Accounts of 2025.
For investors looking for reliable, safer investment options with long-term investment horizons, certificates of deposit (CDs) might be suitable. CDs typically offer higher returns compared to traditional savings accounts, but the investment amount remains locked in during the specified period.
With CD Valet, you can shop and compare top certificates of deposit rates from various banks nationwide.
Their extensive database shows the most competitive rates without bias, with daily rate updates and earnings calculators which give you an array of free tools to help you find the right CD based on your financial goals, time horizon and risk preferences.
Level 5: Flexibility
You can now take more risks or consider life changes — like a career change or entrepreneurship — without fear. Flexibility allows you to follow your passions, knowing your money can handle it.
How to climb: Continue to build diverse income streams and make strategic investments. Real estate, stocks, and side businesses are common ways of building financial flexibility.
To help with growing your portfolio, platforms like Moby, founded by former hedge fund analysts, provides stock research and insights tailored for everyday investors.
Over the past four years, Moby’s stock picks have outperformed the S&P 500 by an average of 11.95%, helping more than 5 million users identify promising investments before they take off.
Level 6: Financial independence
At this level, your investments generate enough income to cover your living expenses. Work is optional.
This level is commonly associated with the FIRE (Financial Independence, Retire Early) movement, where investments provide enough income to cover daily costs and allow you to stop working, all while enjoying more control over your time.
How to climb: Maximize contributions to tax-advantaged accounts like 401(k)s and IRAs, and invest in dividend stocks or rental properties to generate passive income. With the stock market’s ups and downs, a well-diversified portfolio is essential for maintaining your financial independence.
First National Realty Partners makes it easy for accredited investors to grow their returns through grocery-anchored, necessity-based retail properties, like Walmart, Kroger and Whole Foods.
With a minimum investment of $50,000, accredited investors can potentially collect quarterly cash flow through a diverse real estate portfolio – without the leg work of finding deals yourself, negotiating for mortgage rates or managing the purchasing logistics.
Investing in secure commodities
Gold is known for its stability in the face of adverse market conditions or economic downturns. Over the last 10 years, gold prices have risen by over 120%.
Opting for a gold IRA gives you the opportunity to hedge against market volatility by allowing you to invest directly in physical precious metals rather than stocks and bonds.
If you’d like to convert an existing IRA into a gold IRA, companies typically offer 100% free rollover. Others might offer free gold, silver or other metals up to a certain amount when you make a qualifying purchase.
You can check out our top picks for industry-leading companies offering gold IRAs.
Compare offers instantly and request a free information guide to help you understand how to diversify your portfolio.
Level 7: Abundant wealth
Is this the finish line? Sabatier says the final level finds you with more money than you’ll need, allowing you to live your dream life and give back generously. Whether that means traveling, passion projects, or philanthropic work, abundant wealth allows you to pursue what matters most to you.
How to climb: Focus on wealth preservation through diversified investments and estate planning. Giving, whether through charitable donations or creating a legacy for your family, can also become a priority.
Consulting a financial specialist can help you understand the best ways to make your money work for you.
WiserAdvisor has a free online service that helps you find a financial advisor who can co-create a plan to diversify the asset mix in your portfolio and continue building wealth.
Just answer a few questions, and the extensive online database will match you with a few vetted advisors based on your answers.
You can view the advisors’ profiles, read past client reviews, and schedule an initial consultation for free with no obligation to hire.
What will happen to your wealth?
Regardless of where you land in Sabatier’s seven tiers, it’s important to plan for the safe transfer of your wealth to the next generation. Creating a will or trust can help you ensure your loved ones remain protected after your passing.
With Ethos Will & Trust, you can create a living trust online from the comfort of your own home in as little as 20 minutes. All documents created on the platform are vetted by experienced estate-planning attorneys — giving you complete peace of mind.
You can also make unlimited updates forever as your life changes, helping you secure your legacy for your loved ones.
You can create a trust starting at just $349 with Ethos Will & Trust. Plus, if you’re not happy with the results, you can get a full refund within 30 days.
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
