Wondering if you are making progress on your financial goals? The Following are the six most important numbers to check semi-annually. If you established goals at the beginning of the year, then you will be able to see your progress. If you didn’t set these goals, then now is the time to get your current number and then take your financial pulse again in January of the next year.
Print or download this PDF
- Your credit score is something that you should be verifying at least annually by obtaining a credit report from the major 3 major credit providers. Your score matters from loan pricing to availability of services.
- Retirement savings rate requires constant vigilance. The rate should be at the minimum 10% of your gross pay and even higher if you can afford it. Your goal should be to max our your retirement plan contributions.
- One way to determine your level of indebtedness is to calculate your debt to income ratio. This is simply your monthly debt payments divided by your gross monthly income.
- Many people talk about building a rainy day fund. What is important to measure is the number of months you can cover your expenses if your income is lost. This is called your emergency capacity ratio. Divide your emergency fund by the total cost of your monthly expenses.
- A great measurement on how you are doing overall is to calculate your net worth. Basically you add up the value of your assets and cash and subtract all of your debts. The resulting number is your net worth and for many it will be negative for a few years.
- Your financial independence number is the amount you need to have saved to be able to walk away from your job whenever you want because your assets produce enough income to meet your yearly income needs.