Tuesday, December 12, 2006


I read this article yesterday on debt to income ratio. While it may seem straight forward on how to calculate it, I found the ratings interesting. I thought I would share.

Add all your monthly debt obligations (using minimum monthly payments for credit cards) and divide it by your monthly gross income.

If you are under 36%, you are in great shape. If you are between 37-42% you are in an acceptable range. If you are in a 43-49% range you have too much debt and if you are over 50%, you are in trouble.

I haven't gotten up to courage to calculate our situation yet :)

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