I consider myself wealthy but not rich. While it sounds like they are two sides of the same coin, there is a subtle difference. One is related to contentment while the other is related to possessions. If you are investing money to buy more stuff, you are trying to get rich. If you are investing to buy freedom, then you are trying to be wealthy. I can keep going, but the Stoic philosophy has as much to say about wealth. The name of the game is to buy freedom not things. Of course everyone needs money, but it is important to understand that happiness isn’t always found in material possessions.


I came upon an interesting article on 7 levels of financial freedom. It is an old article which I read a long time ago, but it came up again recently and I thought, this is a nice way to think about financial freedom. According to the author, here are the 7 levels


  1. Clarity: When you have understood your financial position and what you can achieve.
  2. Self-sufficiency: When you earn enough money to cover your expenses on your own.
  3. Breathing room: When you escape living from salary to salary.
  4. Stability: When you have six months of living expenses paid and have no consumer debt.
  5. Flexibility: When you have at least two years of living expenses saved.
  6. Financial independence: When you can live off your investment income, and therefore, working is optional.
  7. Abundant wealth: When you’ll have more money than you’ll ever need.


You can test yourself to see where you are in that ladder. I am currently at number 6 and I am pretty happy about it. Reaching number 7 is a non goal for me, but if I ever reach there, it gives a lot of freedom to run philanthropic efforts which may come with its own set of problems.


But how does one become wealthy? Like someone said, “True wealth is not measured by material possessions or luxury, but by the contentment and happiness that come from within”. Like Epictetus said “Wealth consists not in having great possessions, but in having few wants”. So the root cause is desires. Live a simple, frugal life and not be overly attached to material possessions. True wealth is to be able to buy freedom. That is all from me today!