Reasonable Debt Consultant-Financial Analysis Tool

Example

Users are prompted to input detailed information, including net monthly income, monthly expenses (utilities, food, debt payments), and annual costs (taxes, insurance, and discretionary spending).

Scenario

A household earning $5,000 monthly would input this along with their monthly and yearly expenses, allowing the tool to calculate disposable income and potential for new debt.

Example

The tool calculates key metrics such as the ratio of current debt payments to income, assessing if these exceed the recommended 40% threshold.

Scenario

If a household's current debt repayments are $2,200, exceeding the 40% threshold of their $5,000 income, the consultant advises against taking on additional debt.

Example

Based on input data, it forecasts monthly and yearly financial commitments and adjusts available budget after accounting for savings and unexpected expenses.

Scenario

For a household planning to save $300 monthly, the tool recalculates disposable income to ensure these savings are feasible without risking financial strain.

Example

It determines the safe amount for new debt payments, based on the available monthly budget after current expenses and savings.

Scenario

A household with a remaining $400 monthly after all calculations can safely afford this amount as a new car payment, as long as it doesn't push their total debt service ratio past 40%.