Manage Your EMIs: Understand Debt-to-Income Ratio for Financial Stability

• A high Debt-to-Income (DTI) Ratio indicates that a significant portion of your monthly income is consumed by EMIs, leading to financial stress.
• DTI is calculated as (Total Monthly EMIs ÷ Monthly Income) × 100, providing a clear picture of your debt burden.
• Financial experts recommend keeping your DTI below 40%; exceeding this limit is a warning sign for your financial health.
• Regularly monitoring your DTI helps in effective budget planning and prevents over-indebtedness.
• Before taking new loans, assess your DTI to ensure financial balance and avoid future stress.

Why It Matters: The Debt-to-Income Ratio is crucial for assessing financial health and managing EMI burdens effectively.