Stages of Financial Independence

The concept of financial independence is closely associated with retirement; after all, if you aren’t financially independent from work, you won’t be able to retire. But it’s not just a question of whether you are financially dependent or independent; there are several levels between being fully dependant and fully independent.  The following is a guide to the various different levels.

Sadly, we don’t all make it through all of the stages; many people don’t reach the final level. And it can be a bit like Snakes and Ladders, as you can move back a stage, as well as forward:

  • divorce and ill health are usually the snakes, whilst inheritance is the most common ladder.

Many people deliberately make choices that move them back a level (e.g. moving house and increasing their mortgage).

The framework of the levels of financial independence can help us to quickly understand the financial consequences of the choices we make.

Philip Wise | philip@sussexretirement.co.uk

Managing Director and Chartered Financial Planner


This guide is for information purposes and does not constitute financial advice, which should be based on your individual circumstances.

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