Comments on: Personal Financial Ratios http://www.canadiancapitalist.com/personal-financial-ratios/ Helping you invest and prosper Sat, 11 Feb 2012 19:27:54 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Canadian Capitalist http://www.canadiancapitalist.com/personal-financial-ratios/#comment-1079 Canadian Capitalist Fri, 24 Mar 2006 15:18:47 +0000 http://www.canadiancapitalist.com/?p=384#comment-1079 Actually, the savings/expense ratio could be (sort of) derived from the SR and S/I ratios. I couldn't agree with you more that tracking spending is the first step (and most important step) to financial fitness. I would rate it even higher than budgeting because not only the spending patterns give a good idea of how much capital is needed, it could also reveal areas where spending could be cut. Actually, the savings/expense ratio could be (sort of) derived from the SR and S/I ratios. I couldn’t agree with you more that tracking spending is the first step (and most important step) to financial fitness. I would rate it even higher than budgeting because not only the spending patterns give a good idea of how much capital is needed, it could also reveal areas where spending could be cut.

]]> By: 0xcc http://www.canadiancapitalist.com/personal-financial-ratios/#comment-1078 0xcc Fri, 24 Mar 2006 13:02:40 +0000 http://www.canadiancapitalist.com/?p=384#comment-1078 Maybe there needs to be another ratio added to that. A savings/expenses ratio. Personally I believe that one of the most important things that everyone should be doing in their financial life is tracking their expenses. In order to be able to know how much you will need when you are retired you have to know how much it costs to support your lifestyle. Once you have a long-term (i.e. more than 5 years) view of what your spending patterns look like you can start to figure out how big your nest egg needs to be. Maybe there needs to be another ratio added to that. A savings/expenses ratio.

Personally I believe that one of the most important things that everyone should be doing in their financial life is tracking their expenses. In order to be able to know how much you will need when you are retired you have to know how much it costs to support your lifestyle. Once you have a long-term (i.e. more than 5 years) view of what your spending patterns look like you can start to figure out how big your nest egg needs to be.

]]> By: Flexo http://www.canadiancapitalist.com/personal-financial-ratios/#comment-1071 Flexo Fri, 24 Mar 2006 04:23:10 +0000 http://www.canadiancapitalist.com/?p=384#comment-1071 Like you said, ratios are meaningless without context. It would be more interesting to follow an individual's ratio trend for several successive years. Is the S/I ratio increasing and the D/I ratio decreasing? If so, they're in good shape. Like you said, ratios are meaningless without context. It would be more interesting to follow an individual’s ratio trend for several successive years. Is the S/I ratio increasing and the D/I ratio decreasing? If so, they’re in good shape.

]]>