The

Financial Ladder

1. Reckless overspending, high credit card balances, mortgage or rent payment over 40%+ of gross earnings, massive student loan debt and loves high end vehicles.  Has filed bankruptcy at least once and a portion of this out-of-control individuals has filed more than once.  No matter how high their earnings they continue to expand debt living paycheck to paycheck.

2. All debt payments compared to gross income is in the 40%+ range despite the difference from our first example rarely has any savings and only saves in his 401k the matching amount.  Most of the time financial living remains basically paycheck to paycheck.  Emergency fund is maintained by having low balances on credit cards.

3.) Discovers or all ready knew that paying interest is a looser for wealth building and that ever important piece of mind.  Debt snow balls his consumer debt and then builds six months plus worth of expenses emergency fund.  Starts his 401k and snowballs his percentage increases with every pay raise or promotion.  Has little investment financial education after his first real bear market only invests in ultra conservative mutual funds thus lowering his future returns substantially (all short term bonds and money funds all the time).

4.) Is consumer debt free, buys used cars cheap in cash and holds onto them as long as possible.  Mortgage (or paid off) or rent payments are way below his means and pushes his savings rate/investing with the goal of 50%+ of income. 

Devours investment books that stress a valuation approach; avoids YouTube presenters who push overly simplistic approach for all market conditions.

End's up a multi-millionaire living in a comfortable yet very middle class neighborhood driving average type cars with his friends or relatives having no idea how wealthy he has become.

DYI