From Yahoo Finance: 2025-05-12 10:17:00

Financial expert Ramit Sethi shared the seven levels of wealth, each with unique strategies to advance. Survival mode is the lowest level, characterized by financial chaos from unexpected expenses. Sethi offers a path out, emphasizing the importance of knowing income and expenses to optimize finances and escape survival mode.

To understand spending habits, Sethi recommends reviewing past credit card statements and pay stubs. A simple formula of doubling hourly wage and adding three zeros can estimate annual income. Starting small with investments, like saving $20 a month, builds a savings habit to eventually tackle debt and make investments.

As debt decreases, detailed tracking of bills and expenses is crucial. Sethi advises jotting down every financial detail to make more conscious spending decisions. This method, along with consistent saving and investing, can lead to financial freedom and long-term wealth.

Read more: ‘One Unexpected Expense Can Throw Your Whole Life Into Chaos’