When your debt and other living expenses are greater than your income. or you are dependent to someone or something to be able to pay your bills or your living

Pag nakatira ka pa sa parents mo or you are not living with you own expenses.

If income can meet all living expenses with out outside help.

If you already build an emergency fund in additional to being Financial Solvent (Level 1)

Note:

Stage 1: Emergency Fund is 3 to 6 months of Monthly expense

Stage 2: Emergency Fund is 6 months of Monthly expenses

Two definitions

1. Completely debt free

2. Free of the high interest rates e.g. credit cards but you still have mortgage or car loans.

If you can step down from a higher paying job with high stress and do a low paying job with less stress.

Parang from regular employee to a consultant, seminar speaker, or turn hobbies into 

This is because you have saved a very descent amount of money for their retirement, therefore you only need to do is to get a money until you get to 60 yrs old or to a retirement age or until the age you will be withdrawing the from their retirement fund. 

If you have an amount or cash flow from your investments and have grown enough to cover your survival needs.

Although, this is not an ideal spot to retire but if you are at this level and you got fired today, you will be ok because you can survive until you get another job.

Note: 

Survival needs/ expenses are just the basic things you need to survive such as Food, water, shelter, some form of transportation, clothing and probably insurance. Basically this does not include netflix subscription, cable bills, internet.

Living expenses is different from survival expenses, living expenses is your current expenses which includes cars, netflix, internet, celphone, etc.

Similar in anyway with Financial Security (Level 5), but you have an ability to adjust your expenses relative to the market return or dependent on the percentage of return.

Your expenses is being adjust according to the investment return per year.

This is roughly half of Financial Independence (Level 7) or 12.5 times your annual income.

Example:

it this year +20% you can adjust your expenses according to this. and when the next year -20% you can still adjust your expenses based on this.

If you have saved 25 times of your annual expenses, so 4% rule can cover your annual expenses. Therefore you are financially independent.

Basically based o 4% rule.

If you have saved 25 times of your annual expenses, so 4% rule can cover your annual expenses. Therefore you are financially independent.

Basically based o 4% rule.

If the cash flow from your investment is greater than your Financial Independence expenses and a few more life goals you have. Life goals is different form each and every one e.g. cruise trip, around the world trip etc.

If the cash flow from your investment is more than you'll ever need.

(Di na maubos ubos kahit anong gastos mo.)