18 Personal Finance Ratios You Should Know

Do you want to get a better sense of your financial health now?

[{"selector":"#anim-26ca4be0-7080-43a2-866b-17f3d588bc31","keyframes":{"opacity":[1,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-d7222732-7cc0-417a-8d9d-24fbb55ade9f","keyframes":{"transform":["scale(3)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] Read more

Personal financial ratios can give you a picture of your proper financial health and progress relative to your goals.

[{"selector":"#anim-8f92831f-6fee-4799-b1f5-2a9a09400dca","keyframes":{"opacity":[1,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-0b9fd9e5-c941-41c1-941a-489f66d3661f","keyframes":{"transform":["scale(3)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-edf80ab2-421e-45ca-93a7-398fb4bc9745","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-e10b0781-e9a7-4cb4-812f-e92f7edf3041","keyframes":{"transform":["translate3d(0px, 304.98314%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Read more

These benchmarks can help you develop better financial habits in these areas: savings, retirement, spending, investing, and debt management.

[{"selector":"#anim-24196797-ef77-474c-ab44-2a57a021b0f7","keyframes":{"opacity":[1,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-0e3a5608-231a-44a2-947f-c35df43cbd13","keyframes":{"transform":["scale(3)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-5d228802-9ca1-4912-8c65-a833731824ab","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] [{"selector":"#anim-e5f17d8c-0750-4745-8c77-af6b0c71ff28","keyframes":{"transform":["translate3d(0px, 242.18199%, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.2, 0.6, 0.0, 1)","fill":"both"}] Read more

A six ratio means that your monetary assets can pay for your basic needs of food, rent, utilities, and a car loan for the next six months, if necessary.

[{"selector":"#anim-aae87746-88e8-4dee-83ca-272f5b811628","keyframes":{"opacity":[1,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-6b1bcfa4-f57c-4e8c-80dd-2c1e3e191570","keyframes":{"transform":["scale(3)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-466395fa-19af-4098-8eae-df4217060486","keyframes":{"transform":["translate3d(-144.95413%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-a7644cb8-4bc7-4fa4-a9f0-e3353b048d76","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-a49364d5-f07e-47bd-887b-a60a4d0f4ad6","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] [{"selector":"#anim-2a2ebfd9-b553-41ad-87fa-7aca947f9dcc","keyframes":{"opacity":[0,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-d61697ba-c809-412b-a2c1-6cc96074c7fa","keyframes":{"transform":["scale(0.3333333333333333)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] Read more

2. Emergency Fund Ratio

[{"selector":"#anim-7b2da724-8854-4e65-b6ef-eb235295f6f8","keyframes":{"opacity":[1,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-46228a33-2e15-44dd-a372-91f2c78bf273","keyframes":{"transform":["scale(3)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-7e791bad-e1ca-4fa7-81f0-56b1184daa89","keyframes":{"opacity":[0,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-1bda64e7-e31c-4f18-a378-d62c0f7a55ee","keyframes":{"transform":["scale(0.3333333333333333)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-8df33045-57f4-4236-87ce-82350c91880f","keyframes":{"transform":["translate3d(-130.88804%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-b2918632-7feb-4faa-b409-b88780bed194","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-37a5a880-2a29-4212-b369-c7983494a0b8","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] Read more

Your balance statement measures your net wealth at a point in time. As you add to your assets, hopefully outpacing your liabilities, you will be getting wealthier.

[{"selector":"#anim-43e2ed24-7c8d-4ec2-abe7-979f2fa09386","keyframes":{"opacity":[1,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-a8933224-f2d6-45e0-a5e6-c14c08310c35","keyframes":{"transform":["scale(3)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-ba0de165-7365-43bf-b341-6f25b4ac1652","keyframes":{"transform":["translate3d(-134.79999%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-9cc9a397-04f2-47f0-8acb-d9259a9679c0","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-cf70ad5d-e985-40a7-89a0-e481bb4db1c6","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] [{"selector":"#anim-5a37ecca-650d-4fc0-af84-b589ebc3f31e","keyframes":{"opacity":[0,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-7840f325-dc04-4bae-aea7-4c60ea0ab2e1","keyframes":{"transform":["scale(0.3333333333333333)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] Read more

Your targeted net worth provides you with an indication of what you should be worth after liabilities.

[{"selector":"#anim-4a64ecaa-be8f-4416-91db-6afda7c748a9","keyframes":{"opacity":[1,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-f1766d4e-6a58-4d78-b5b7-20b8322d27f4","keyframes":{"transform":["scale(3)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-ac7d8139-8388-4937-b820-8a526d2edced","keyframes":{"transform":["translate3d(135.56486%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-28722dbe-f176-4518-a47a-27197df76681","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-0fa7c7b6-3b5e-4c63-bcef-2c7721be485d","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] [{"selector":"#anim-62886cfb-0170-481d-aa6d-fbeac19d61c2","keyframes":{"transform":["translate3d(127.86260%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-8aecc2a4-8a44-4343-a05c-8f1247f0d11b","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-3201223c-2fde-4798-962b-3edd040c12eb","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] [{"selector":"#anim-9852eed8-b7a9-4b49-aa24-aee9254c0167","keyframes":{"opacity":[0,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-bcfb5971-9cc2-4e13-8296-f08e8c6e2a1b","keyframes":{"transform":["scale(0.3333333333333333)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] Read more

The current ratio is the best benchmark to determine liquidity in your household. It measures the household’s ability to repay a short-term debt in an emergency.

[{"selector":"#anim-1a1bb126-e90b-456e-aab6-036030c81bc7","keyframes":{"opacity":[1,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-c9f0339b-0b7a-400e-a521-1d49d413592a","keyframes":{"transform":["scale(3)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] [{"selector":"#anim-496a376f-bc6c-4a1a-9515-22eb5befd7a9","keyframes":{"transform":["translate3d(-131.7647%, 0px, 0)","translate3d(0px, 0px, 0)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-cee8ef1a-12ec-42c8-a077-fb39d50e9810","keyframes":{"opacity":[0,1]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"both"}] [{"selector":"#anim-70d06135-9965-4852-b162-c3cfb1215c25","keyframes":{"transform":["scale(0.15)","scale(1)"]},"delay":0,"duration":600,"easing":"cubic-bezier(0.4, 0.4, 0.0, 1)","fill":"forwards"}] [{"selector":"#anim-b9f97bbd-4f85-4cc8-be2c-6a7e1f399e77","keyframes":{"opacity":[0,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-32ff19e5-5a54-4e11-a286-c5f737fa9ea5","keyframes":{"transform":["scale(0.3333333333333333)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] Read more

Swipe Up To Read More

[{"selector":"#anim-d5d87525-7d68-4dca-8718-b4affd9302c1","keyframes":{"opacity":[1,1]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] [{"selector":"#anim-b1c5c59f-facd-4bed-8ffb-e3d53fdae6d0","keyframes":{"transform":["scale(3)","scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] Read more

18 Personal Finance Ratios You Should Know

Do you want to get a better sense of your financial health now?

Personal financial ratios can give you a picture of your proper financial health and progress relative to your goals.

These benchmarks can help you develop better financial habits in these areas: savings, retirement, spending, investing, and debt management.

A six ratio means that your monetary assets can pay for your basic needs of food, rent, utilities, and a car loan for the next six months, if necessary.

1. Liquidity Ratio

2. Emergency Fund Ratio

This ratio will give you a targeted amount of monetary assets needed to be comfortable for a possible emergency.

Your balance statement measures your net wealth at a point in time. As you add to your assets, hopefully outpacing your liabilities, you will be getting wealthier.

3. Net Worth Ratio

Your targeted net worth provides you with an indication of what you should be worth after liabilities.

4. Targeted Net Worth Ratio (The Millionaire Next Door)

The current ratio is the best benchmark to determine liquidity in your household. It measures the household’s ability to repay a short-term debt in an emergency.

5. The Current Ratio

Swipe Up To Read More

Read More