How to Calculate Your Debt-to-income Ratio

Calculate your debt-to-income ratio by comparing how much you earn to how much you owe in a given month.

Your gross monthly income is the amount of money you earned before taxes and other deductions. This includes both your salary and any other sources of income you may have, like bonuses, overtime, commissions, or investments.

Recurring monthly debt includes rent or mortgage, student loans, credit cards, auto loans, and any other regular payments. Make sure not to include living expenses like utilities, food, gas, and entertainment.

Divide your monthly debt by your monthly gross income. You will get a decimal number as a result. Multiply that number by 100 to get your DTI as a percentage.

How to calculate your debt-to-income ratio.

Example of a DTI Calculation

Recurring monthly debt payments:

  • $1,000 rent
  • $200 student loan payment
  • $150 credit card payments
  • $450 auto loan payment
  • $100 other debt payments
  • TOTAL: $1,900

Monthly gross income:

  • $5,500 from salary
  • $1,000 from a part-time job
  • $500 from freelancing
  • TOTAL: $7,000

Calculate the DTI:

DTI = ($1,900/$7,000)*100 = 27.14%