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Leveling up in Cindergrove does not serve quite the same purpose as it does in D&D or in video games. In Cindergrove, you level up in order to be able to take on harder quests, which in turn give better loot, experience (or 'XP') and other rewards.

There are five classes of quests in Cindergrove, separated by tier. When you join the game, your character is assigned a level based on their earlier experience (but never beyond the second tier) and can take on quests within that tier (and sometimes above or below it, so long as the average party level matches the tier of the quest.) As you complete quests and monthly activity checks, your character gains XP, and eventually levels up.

Experience, Levels, and Tiers
Experience
0
0-299
300-899
900-2,699
2,700-6,499
6,500-13,999
14,000-22,999
23,000-33,999
34,000-47,999
48,000-63,999
64,000-84,999
Level
0
1
2
3
4
5
6
7
8
9
10
Tier
0 (A special tier for the inexperienced. Most NPC's are Tier 0.)
1
1
1
1
2
2
2
2
2
3

Tier 0 Quests
Suitable for most people to undertake, these quests help maintain the daily life in Cindergrove. Unskilled work usually provides about 2sp per day, and skilled work (that requiring training or special expenditures) offers 2gp. This is also the wage that employers pay workers, if you decide to open a business, and failing to pay consecutively for more than 2 weeks in a row can have consequences. Experience can be gained within this tier, but it is more in the form of learning new skills--mastering a trade, fulfilling some prerequisite to truly call yourself an adventurer.

Tier 1 Quests
These quests are suitable for adventurers who are just learning how to work together and how to make the best of their unusual abilities. They might involve clearing out Rats Of Unusual Size, tracking down a bandit camp, exploring a haunted cave, or dealing with unusually aggressive forest beasts. Rewards in this tier are often less than 10gp per adventurer, but occasionally some really nifty loot can be found. During this tier it is good to build a relationship with a patron, and trust with other adventurers. The payoffs will benefit everybody.

Tier 2 Quests
You might need some backup on these; clearing out a magic-infested mine, tracking down a crime lord's den, destroying a fledgling necromancer, or parlaying with a dangerous band of druids... it's not easy work, and it demands better rewards. You're likely to find some sweet loot in addition to being paid better for these jobs, but the chance of being killed along the way is higher, too. Heck, if you manage to secure resources for the town, you may just get a cut...

Tier 3 Quests
These are incredibly dangerous quests that will pit you against true monsters; dragons, liches, and beholders oh my! Be sure to be well prepared; these creatures are only ever tackled if they are proving a real threat to the folks in the world beyond. It might behoove you to bring a sword... or maybe a pen; there are more subtle and lasting rewards for forging peace than there are in conquering and taking, aren't there?

Tier 4 Quests
(Cindergrove isn't likely to have quests at this tier, at least not for years to come. These are truly planet-changing circumstances that only those who are god-like in their powers can take on and hope to survive. Leave it to the professionals; there are heroes in the realms who are keeping places like Cindergrove safe from the worst of the worst.)