Money ratios can help you quickly gauge the health of your finances and pinpoint what changes you need to make to improve them.
Here 5 of the important ones you should know.
1. 50% Budgeting Ratio
The budgeting rule of thumb that limits your must have expenses to less than 50% of your income.
2. Credit Utilization Rate
The ratio of the sum your revolving credit line balances to the to the overall credit limit.
3. Student Loan Debt-To-Salary-Ratio
The upper limit of student loan debt to take on in order to realize the return on investment in earning a college degree.
4. Loan-To-Value Ratio
How much of the property your purchased with a loan, you actually own.
5. Debt-To-Salary Ratio
A ratio of all your monthly debt obligation compared to your monthly income.
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To learn more about why they are important and how to apply them to your finances, head over to read the entire post, at CleverGirlsKnow.com.
~ Melisa Boutin