Debt to Income Ratio

[ProfMoneyWise]

How to Tell Whether You Are Saving Enough - Yahoo! Finance

"The average debt-to-income ratio, or DTI, is 125 percent today. Economists roughly consider a 100 percent DTI ratio to be "normal" or healthy. So if you owed a combined $125,000 on your mortgage, car loans and other obligations and earned $100,000 in take-home pay, you'd want to pay down your debt by $25,000, or 20 percent, to be in the safe zone."


At 100% DTI the average is to owe what you have yet to make in the next 12 months. I suggest being below average.

 

[Aerogal]

Well, look at your source: YAHOO and USNews, neither of which I would trust to give me the time of day, the liberal bent encouraging the American people impoverish themselves.
Notice how it is now Debt To Income vice Income To Debt. Best place to be is debt free, but keep it as far below 40% that you can. Most banks won't touch you if you're over 30% nowadays.

 

[FromTexas]

Well, look at your source: YAHOO and USNews, neither of which I would trust to give me the time of day, the liberal bent encouraging the American people impoverish themselves.
Notice how it is now Debt To Income vice Income To Debt. Best place to be is debt free, but keep it as far below 40% that you can. Most banks won't touch you if you're over 30% nowadays.

They are using a different "debt to income" ratio -- total debt to income in a year. They are not using debt payments to income in a year. The traditional metric is debt payments to income and should be 28% or below.

 

[FromTexas]

They are using a different "debt to income" ratio -- total debt to income in a year. They are not using debt payments to income in a year. The traditional metric is debt payments to income and should be 28% or below.

And their other metric is stupid.