Optimal Finance Daily - Financial Independence and Money Advice 3176: Signs You Have Too Much Debt by James Lambridis of Debt MD on Financial Health
Jun 13, 2025
Explore the warning signs that your debt could be jeopardizing your financial well-being. Learn about the crucial Debt-to-Income ratio and how it plays a role in managing your finances. Discover strategies for reducing bad debt while recognizing the difference between good and bad debt. Get practical tips for enhancing income and cutting expenses. Lastly, uncover aggressive methods to tackle and overcome credit card debt, paving the way to a healthier financial future.
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Know Your Debt-to-Income Ratio
- Calculate your Debt-to-Income ratio (DTI) to know if your debt is manageable.
- Aim to keep DTI at or below 35% for favorable lending and financial health.
How to Lower Your DTI
- Improve your DTI by increasing income or decreasing expenses.
- Consider side gigs for income and refinancing loans to reduce monthly payments.
Watch for Signs of Excessive Debt
- Pay attention if debt balances don't decrease despite payments or you have no savings left.
- Avoid relying on credit cards for basics or taking cash advances; these indicate too much debt.