I picked up The Wealth Ladder by Nick Maggiulli, expecting another book about cutting lattes and maxing out IRAs. What I found instead was a big picture map, based on real data, showing what it actually takes to climb from poverty to wealth, and whether it’s worth sacrificing your life to reach the top. It challenged what I thought I knew about financial freedom. If you’ve ever wondered if the next level of wealth will really make you happier—or if you should start enjoying where you are—this book is for you.
The Wealth Ladder: What You Need to Know
Maggiulli draws on data from the U.S. Federal Reserve, the Survey of Consumer Finances, and other economic research to break down the six key levels of wealth in America. What he reveals is surprising: yes, escaping poverty dramatically boosts your health, happiness, and choices—but after a certain point, more wealth doesn’t always bring significantly greater happiness.
In fact, for many, wealth can become another form of bondage—more stress, more risk, more pressure, and possibly paranoia. The superrich are also at the greatest risk of losing their vast wealth, as most of their wealth is often tied up in their business.
The Six Levels of Wealth
Maggiulli defines each rung of the wealth ladder by net worth, not income. Each level reflects a radically different way of life.
Level Approx. Net Worth
- Level 1: Less than $10,000
- Level 2: $10,000 – $100,000
- Level 3: $100,000 – $1 million
- Level 4: $1 million – $10 million
- Level 5: $10 million – $100 million
- Level 6: Over $100 million
The key takeaway? It’s not just about how much money you have—it’s about how your life feels at each level. What decisions can you make? What burdens, and opportunities, appear or disappear? And whether you have time and the health to enjoy the life you’re working so hard to create.
Why Leveling Up Is Hard (and Sometimes Not Worth It)
Breaking out of the bottom levels of the wealth ladder—especially from Level 1—is critical. Living with less than $10,000 in net worth means every unexpected bill is a crisis. The constant financial stress has a measurable impact on your health and happiness.
But climbing beyond Level 3 or 4? That’s when the costs start to climb, too—time, energy, mental load, responsibility. At some point, you’re not working for joy or freedom—you’re working to maintain appearances, grow investments, and manage complexity.
Maggiulli doesn’t say “don’t climb”—but he does say: know your reasons. I liked the book for this reason: you go in open-eyed as to what it may take, what you actually stand to gain, and what you risk.
5 Powerful Lessons for Financial Freedom
1. Know which level you’re on. This may sound obvious, but most people have no clear sense of where they stand financially. They might know their income, but not their net worth—and that’s a problem. Without knowing your true position, you risk reaching for strategies that aren’t right for you.
If you’re in Level 1 or 2, you need stability and breathing room. If you’re in Level 3 or 4, you might be focusing on optimization, growth, or lifestyle design. But if you’re unknowingly copying someone at Level 5 or 6—whose life circumstances, stressors, and wealth structures are completely different—you’ll feel confused, behind, and exhausted.
Track your net worth yearly—not because the number matters so much, but because the awareness does. When you know your level, you can start from reality, not fantasy.
2. Escape the fragility of the lower levels first. If you’re under $10,000 in net worth, life is precarious. Every little mishap—a car repair, medical bill, job loss—can spiral into crisis. Maggiulli calls this “financial fragility.” I call it survival mode. It’s hard to dream big, live freely, or be your best self when you’re constantly worried about money.
The first goal should be to build reserves. Not just money, but time, energy, emotional support, and a sense of safety. It might look like:
- A starter emergency fund
- Paying off high-interest debt
- Setting up autopay on bills
- Saying no to unnecessary spending (not out of punishment—but power)
These early wins change how you feel—about money and about yourself. That shift, from reactive to proactive, is going to get you out of financial fragility and into a feeling of financial security.
3. Align spending with your level—not your income. This one is subtle, but it changes everything. Most people budget—or spend—based on income. But Maggiulli makes a compelling case for spending in line with your net worth. Why? Because income can rise and fall, but net worth is a better indicator of what you can truly afford over the long run.
I’ve seen clients earning $200,000 a year feel trapped and anxious because their lifestyle is designed for Level 5—but they’re actually at Level 2 or 3. That kind of misalignment steals your peace and flexibility. Ask yourself:
- Is this expense aligned with my values—or my ego?
- Does it serve my current level, or am I trying to jump ahead?
- Would I feel freer with or without this expense?
Financial freedom often means saying yes to less—so you can say yes to more of what truly matters.
4. Don’t assume more wealth equals more happiness. This is the one that surprises people most. We assume that more money = more joy, more peace, more freedom. But that’s not always true. Sometimes it’s the opposite.
Maggiulli points out that the leap from Level 4 to Level 5 (and beyond) often requires sacrifices—your time, your health, your relationships. I’ve seen clients make millions and still feel anxious, disconnected, or burdened by their success. They’ve climbed the ladder, only to find the view isn’t worth the climb.
This doesn’t mean don’t grow. It means grow consciously. Ask:
- What am I sacrificing to get to the next level?
- Is that sacrifice worth it to me?
- Have I already reached a level where more won’t make me happier?
Financial freedom is not a number—it’s a feeling. A way of being. A life designed around enough. If you feel it’s never enough, it might be more beneficial to work on meeting your hidden personal and emotional needs. You may be working hard to get more money, but the fastest way to feeling genuine contentment and happiness is getting your emotional needs met LINK TO QUIZ and aligning your life with your true values. This is what I help my high-net-worth clients achieve so they feel peace and contentment while climbing the wealth ladder, not waiting until the top.
5. Your strategy must evolve as you grow. The habits that got you to Level 2 may hold you back at Level 4. And that’s okay! Growth requires change. But here’s the trick: most of us cling to strategies that no longer serve us.
Maybe you were a super-saver early on, pinching every penny. But now, you’re earning more—and it’s time to learn how to invest, delegate, or spend joyfully. Or maybe you’ve always gone it alone—and now it’s time to build a team, hire a coach, or automate your systems.
Don’t let outdated tactics keep you small. At each level of wealth—and each stage of life—you must be willing to let go, learn, and lead differently. If you’re not sure what your next-level strategy looks like, that’s what coaching is for. You don’t have to figure it out alone.
Final Thoughts: Your Life, Your Ladder
Maggiulli’s brilliance lies in helping us see what most of us don’t always feel intuitively: more is not always better. Freedom isn’t found at the top—it’s found when you align your money with your values.
You don’t always need to “hustle harder” to be free. You need a smart strategy and the courage to live your own version of a rich life, not a media-inspired version of happiness.
Action Plan: Build Freedom, One Rung at a Time
Here’s what I recommend based on Maggiulli’s ladder—and my 30+ years of coaching clients toward freedom:
- Locate yourself on the ladder with honesty and compassion.
- Define what financial freedom means for you—not someone else.
- Simplify and stabilize before you seek more.
- Spend aligned with your values, not ego.
- Re-evaluate regularly—is your strategy still serving you? Is more worth it?
And above all: enjoy the level you’re on. Don’t climb for the sake of getting more. Freedom is available long before you reach the top.
More Resources
The Wealth Ladder by Nick Maggiulli — a grounded, data-rooted view of wealth and wellbeing.
Your Money or Your Life by Vicki Robin & Joe Dominguez — reframing the relationship with money.
Man’s Search for Meaning by Viktor Frankl — reminding us that purpose matters.
My Financial Independence, Retire Early Course — for designing a life of freedom now, not someday.
