What's your debt to annual income ratio? [Archive] - Beyond.ca - Car Forums

Tik-Tok

11-04-2007, 04:56 PM

Just talking about it at work today, I was surprised at some answers from co-workers, and was wondering what others might be

NOT including your primary residence mortgage, or business loan, or your normal monthly bills, what's your debt to income ratio? So basically and credit card debt, lines of credit, car debt, school loans etc. etc.

Ekliptix

11-04-2007, 05:24 PM

Except for my house, I don't have any debt.
Every car I've had, starting with a 91 Integra, have been paid in full by me.

nismodrifter

11-04-2007, 05:57 PM

My expenses = $35,000 USD per year
My income = $0.00

Yay for being a student!!! lol

A790

11-04-2007, 05:59 PM

I have no debt anymore.

R!zz0

11-04-2007, 07:57 PM

I have about $25,000 left on my mortage and about $5,000 in debts. Can't wait to have it all cleared up. Mind you if i work full time, i can prolly have it payed off in a year. So i'm semi retired you can say.

max_boost

11-04-2007, 08:35 PM

Yeah I have a lot of debt. I enjoy my toys. Cars, investments etc. so I have a lot of monthly payments. If I don't work for a month then I am screwed :rofl:

But then at least I know it's tied up in something so I can always just sell my cars and investments to shed the burden.

I try to pay cash for everything else, food, clothes, partying. Then it's gone and I don't have to get reminded of it through statements. Some of my friends put everything on the credit cards and at the end of the month they have a bill for $2000 and they are wondering WTF cause they have nothing to show for it.

Roadrage

11-04-2007, 11:05 PM

My ratio would be: too much to not enough

Masked Bandit

11-05-2007, 11:44 AM

Without the mortgage, I have no debt.

Including the mortgage, it's about two years personal income.

FWIW, I think the mortgage should be included in this. Debt is debt.

SilverRex

11-05-2007, 11:51 AM

Originally posted by max_boost
Yeah I have a lot of debt. I enjoy my toys. Cars, investments etc. so I have a lot of monthly payments. If I don't work for a month then I am screwed :rofl:

But then at least I know it's tied up in something so I can always just sell my cars and investments to shed the burden.

I try to pay cash for everything else, food, clothes, partying. Then it's gone and I don't have to get reminded of it through statements. Some of my friends put everything on the credit cards and at the end of the month they have a bill for $2000 and they are wondering WTF cause they have nothing to show for it.

wont it be an advantage to put everything as much as you spent on credit card especially ones that offer travel miles or cash backs? then again I guess only if you are dicipline enough to do that. oh wait your rich enough and you dont care about reward points. haha :nut:

blownz

11-05-2007, 11:54 AM

No debt aside from my mortgage.

Although my mortgage could be considerably less if I didn't have 90k worth of vehicles in my garage. :(

Bottom line with debt is to live within your means. Too many people end up in trouble because they borrow for everything they need.

Antonito

11-05-2007, 12:04 PM

Originally posted by Masked Bandit
Without the mortgage, I have no debt.

Including the mortgage, it's about two years personal income.

FWIW, I think the mortgage should be included in this. Debt is debt.

Mortgage is a debt, true, but it's also something you can't get around, because you'd either be paying a mortgage or paying rent.

As for me, this year I'm sitting at about 50%, last year was about 100%, and I don't even want to think about during school. But next year I should be getting pretty close to 0 unless I completely burn out.

rc2002

11-05-2007, 12:12 PM

^ With house prices in Calgary. If you included the mortgage, all of the poll options would have to be changed.

A person making $60k a year buying a $400k house almost has a 700% ratio.

R!zz0

11-05-2007, 12:44 PM

Mortgage is not a debt, it's an investment...Equity.

bigboom

11-05-2007, 01:05 PM

Originally posted by R!zz0
Mortgage is not a debt, it's an investment...Equity.

what about the interest that you pay on it? should you break out the interest portion because that is nothing but an expense. a mortgage is till debt.

finboy

11-05-2007, 01:11 PM

0 debt (maybe a couple hundred on credit cards), no house :(

Rockski

11-05-2007, 01:33 PM

i own my 2 vehicals but i still rent, other then that, my cash goes to insurance and supporting the household while my girlfriend is in school

Antonito

11-05-2007, 01:45 PM

I think the reason to leave out mortgages is that it is very complicated. Some people owe more than what the house is worth, some have places that are worth 5 times what they still owe. $100,000 may be a lot of debt compared to your salary, but if the place is worth $600,000 in equity, it's a bit misleading to say that you are in debt over the house.

And it still ignores the fact that if you include a mortgage, then renters should include their rent for the next 20 years

Masked Bandit

11-05-2007, 02:32 PM

Originally posted by R!zz0
Mortgage is not a debt, it's an investment...Equity.

The idea that your principal residence is an asset is one of the most misleading ideas out there.

The Rich Dad, Poor Dad series put it very clearly:

If it makes you money, it's an asset

If it costs you money, it's a liability (debt)

Last time I checked, my house costs me money. Even if you take the interest on the mortgage out of the equation you still have utilities, taxes, insurance & maintenance as far as costs go.

Now I'm not saying that there is really much way around it, we all have to live somewhere. I'm just saying as far as my personal finances are concerned, I still consider it debt.

Masked Bandit

11-05-2007, 02:34 PM

Originally posted by richardchan2002
^ With house prices in Calgary. If you included the mortgage, all of the poll options would have to be changed.

A person making $60k a year buying a $400k house almost has a 700% ratio.

Then maybe that person shouldn't be buying a $400k house by themselves? If it's with a spouse then I would suggest they compare the $60,000 vs the $200,000 that is their share.

FiveFreshFish

11-05-2007, 06:38 PM

Zero. Paid out the mortgage awhile back.

asuth077

11-05-2007, 06:43 PM

Debt to Asset ratio would probably be a better poll.

thrasher22

11-06-2007, 01:01 AM

None, I pay for everything in cash, I hate having any debt on my shoulders. I used to CC everything, and always wondered why I had no money.
Maybe I'm old fashioned, but if you can't afford something, you probably shouldn't buy it :dunno:

Frosty

11-06-2007, 02:05 AM

No debt at all. Living within my means is humbling, but rewarding in state of mind. :thumbsup:

hondapower

11-06-2007, 02:40 AM

:clap: :clap: :clap: :clap: :clap: :clap: :clap: :clap:

codetrap

11-06-2007, 09:46 AM

Yeah, it's kindof nice to be able to live within your means, and still put money away, as well as doing stuff like renovating the house on a cash basis.

I'm looking forward to the time when my wife can stay home full time and take care of the minion. Career advancement is fun!

2EFNFAST

11-08-2007, 02:31 AM

0%.....only "debt" I carry is monthly cc until m/c sends me my statement.

Originally posted by Antonito

Mortgage is a debt, true, but it's also something you can't get around, because you'd either be paying a mortgage or paying rent.

Or you pay in 'cash' for your properties ; not everybody needs to mortgage/rent to have property. :dunno:

old&slow

11-08-2007, 06:30 AM

Originally posted by Masked Bandit

The idea that your principal residence is an asset is one of the most misleading ideas out there.

The Rich Dad, Poor Dad series put it very clearly:

If it makes you money, it's an asset

If it costs you money, it's a liability (debt)

Last time I checked, my house costs me money. Even if you take the interest on the mortgage out of the equation you still have utilities, taxes, insurance & maintenance as far as costs go.

Now I'm not saying that there is really much way around it, we all have to live somewhere. I'm just saying as far as my personal finances are concerned, I still consider it debt.

I've heard the term "good debt" applied to mortgage!

Masked Bandit

11-08-2007, 11:59 AM

Originally posted by old&slow

I've heard the term "good debt" applied to mortgage!

Good debt...ya as good as debt gets I guess..lol.

I'm still looking forward to being mortgage free though. I hate owing anyone anything.

GO RIDERS GO!

Heff

11-08-2007, 01:32 PM

The only outstanding debt we carry over month to month is our mortgage.

We own our car. We zero our Credit Cards monthly. We save money, and invest for retirement.

sputnik

11-08-2007, 01:41 PM

I think you guys have the wrong definition of "debt ratio".

Debt ratio is the amount of money you pay in monthly payments over the amount of money you make in a month.

So if you make $5000/month and have $2000/month in payments (mortgage, car, credit etc).

Then your gross debt ratio is at 40%.

Heff

11-08-2007, 01:50 PM

By Sputniks Definition, I believe my Wife and I maintain an 18% ration with our mortgage alone ... but we have a HELOC so the payments equate to a higher payment ratio, and this figure just accounts for the mandatory interest payment.