Five Wealth Levels

A framework for understanding different levels of wealth and their impact on happiness/lifestyle, from basic survival to post-consumption enlightenment.

The Five Wealth Levels

• Level 1-2: Survival/Struggling

  • Crushed by circumstances
  • Basic needs not fully met

• Level 3: Middle Class

  • Has house, car, and some savings
  • Can't buy whatever they want
  • Uncertain about funding future big expenses (college, bigger house)
  • A "great happy place" to be
  • Already in top 1% of all humans who have ever lived

• Level 4: "We Like Nice Things"

  • Spans upper middle class to ultra wealthy
  • Basic life is sorted
  • Focus shifts to buying enjoyable things
  • Can include:
    • Vacations
    • Second homes
    • Private jets
  • Key traits:
    • State of mind, not specific income level
    • Endless playground of things to buy
    • Can spend whatever you earn

• Level 5: Post-Consumption

  • No longer focused on material goods
  • Emphasis on time allocation
  • Different manifestations:
    • Could be small house/truck on Wyoming farm
    • Could be power player in NYC
  • Key characteristics:
    • Focused on intrinsic motivation
    • Emphasis on personal purpose
    • Time becomes primary currency

Key Insights

• Happiness doesn't scale linearly with wealth

• Level 4 can bring unexpected stress/anxiety

• Level 3 to 4 transition has mainly upside

• Level 4 contains potential happiness traps

• Recommendation: Experience Level 4 lifestyle first

  • Try business class flights
  • Visit Paris
  • Rent boats
  • Then assess what actually brings joy

• Happiest people typically:

  • Reach Level 5 mindset
  • Work on intrinsically motivating projects
  • Focus on internal vs external validation