personal finance ratios

On my way to work, I was running my finances through my head and had this thought.

Total up all your expenses (household expenses, personal expenses, EMIs, monthly savings for annual expenses, and anything else that you treat as an expense) in the past month. Divide this figure by the number of days in that month. That’s your Daily Cash Burn Rate (DCBR).

In short,

DCBR = Total Expenses in Month M   ÷   No. of Days in Month M

Mine was frightening — I wish I could disclose the actual figure — and an eye-opener. It’s time for some fiscal prudence.

How about you?

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