Lotto advertisements are fantastic at selling you the dream of $50 million worth of wealth. Sometimes they talk about quitting work, taking holidays, buying houses. Or it’s something less cliché, like chartering a pirate ship for your kid, or bonding with your colleagues in Antarctica. But what really sells the dream is not the pirate ship or southern borealis … it’s the freedom. That’s the real attraction of being wealthy: freedom.

There are lots of ways to think about levels of wealth, and one is by considering the six stages of wealth freedom, as set out in this blog by finance writer Nick Maggiulli. Each one is a considerable jump from the next – in both money and freedom. And the jumps get larger as you move up the ladder. Most of us start out at stage 1 and, with a bit of luck and some good planning, should reach stage 2 or 3; very few people ever make it to stage 5 or 6.

Which stage are you at now – and which stages have you left behind?

Stage 1

Nothing to spare – very little wealth freedom

You spend as much as you earn, or more, and you have negative or very low net worth. Maybe you’ve just started working, or you’re studying, or perhaps you have high levels of personal debt. As a result, your financial freedom is low and you must watch every dollar you spend.

Stage 2

Supermarket freedom

When you no longer spend everything you earn, you gradually reach the stage of supermarket freedom. This is where you can make more choices when you shop. You can pay more for free-range eggs or fairtrade coffee without worrying that it will put a dent in your finances.

Stage 3

Restaurant freedom

When you are comfortably earning more than you spend every month, you reach the point of being able to go to a restaurant and choose anything off the menu without worrying about the price. Whether it’s a $42 steak or a $200 bottle of wine, you know your meal will not set you back financially.

Stage 4

Travel freedom

Once you’re earning considerably more than you’re spending, and you know your money will keep rolling in, you no longer need to worry about taking affordable holidays. Now you can travel wherever you like, fly business class, stay in whatever hotel takes your fancy, and do whatever activities you like while you’re there. You’re free to spend like that, knowing your wealth will remain undiminished.

Stage 5

House freedom

You’re wealthy enough to buy the house you want in the area of your choice – another million or ten isn’t going to make much difference. You can buy some other houses, too, if you like. Why not? You’re always looking for somewhere to put your money. It’s not like you can spend it all.

Stage 6

Philanthropic freedom

Now you have so much money that you can give it away and it can dramatically change other people’s lives for the better. There’s no way you could spend all your money within your lifetime, so your main issue is planning how best to pass it to the next generation and how much good you can do with it.

Moving between stages

If you’re aiming to move up the stages, it’s important to spend appropriately for your level of wealth. If you’re in stage 1 and you spend like you’re in stage 3, you’re only going to keep going backwards into negative wealth territory. You also need to invest appropriately, balancing your risk profile with how much you can afford to lose.

Once you do reach a new stage, though, why not spend more and take a few investment risks? Although lifestyle creep is often seen as a problem, if you’ve moved from stage 2 to stage 3, it’s your choice to enjoy a nice bottle of wine with a restaurant meal. Spending more once you can afford it could make your life more enjoyable – and allow you to share some of your good fortune with the people you love.

This story originally appeared on the Zagga blog and is reproduced here with permission.