Financial Ratios Analysis Calculator
Sr.No | FINANCIAL RATIOS ANALYSIS | Particulars | Amount | Actual | Range |
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1) BASIC LIQUIDITY RATIO |
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Cash / Liquid Assets ______________________________________ Monthly Expenses |
This ratio indicates one's ability to meet mandatory monthly expenses & other emergency needs | ______________________________________ |
< 3 Adverse 3- <5 Moderate 3- <5 Moderate > 6 Less Optimum |
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2) EXPANDED LIQUIDITY RATIO |
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Liquid Assets ______________________________________ Net Worth |
This ratio is required during emergency situations when it may not be possible to convert one's assets into cash | ______________________________________ |
< 10% Adverse 10% - 15% Moderate > 15% - Optimum |
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3) SAVINGS RATIO |
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Savings ______________________________________ Gross Inflow |
This ratio calculates the proportion of income an individual sets aside for savings out of the total income | ______________________________________ |
< 10% Adverse 10% - 25% Moderate > 25% - Optimum |
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4) DEBT ASSET RATIO |
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Total Liabilities ______________________________________ Total Assets |
This ratio calculates an individual's ability to pay liabilities out of assets. | ______________________________________ |
< 30% - Optimum 30% - 50% - Moderate > 50% - Adverse |
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5) SOLVENCY RATIO |
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Net Worth ______________________________________ Total Assets |
This ratio is used to measure the potential of long-term solvency | ______________________________________ |
< 30% - Adverse 30% - 50% - Moderate > 50% - Optimum |
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6) DEBT SERVICE RATIO |
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A) | Annual Debt Payments ______________________________________ Annual Take-Home |
These ratios are used to measure an individual's ability to make debt repayments out of Net Take Home | ______________________________________ |
< 25% - Optimum 25% - 45% - Moderate >45% - Adverse |
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B) | Non-Mortgage Debt ______________________________________ Annual Take-Home |
______________________________________ |
< 7% - Optimum 7% - 15% - Moderate >15% - Adverse |
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7) FINANCIAL INVESTMENT RATIO |
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Invested Assets ______________________________________ Net Worth |
This ratio is used to determine an individual's invested assets (excluding self consumption) out of total Net Worth | ______________________________________ |
< 30% - Adverse 30% - 50% - Moderate >50% - Optimum |
Notes:
- Basic Liquidity Ratio - Cash / Liquid assets Will include only cash, liquid funds, savings & flexi accounts
- Expanded Liquidity Ratio - Will include assets such as MFs, Direct Equity, etc besides the liquid assets
- Savings Ratio - Only regular / systematic savings to be included. Gross inflow to include all inflows
- Debt Service Ratio - Annual Take Home will be calculated as Gross Income minus taxes & Contributions & Deductions from Salalry, etc