Your Money Ratios: 8 Simple Tools for Financial Security at Every Stage of Life

A leading financial adviser offers a groundbreaking and simple approach to tackling personal finance by breaking down formulas used by the most successful businesses.

A troubled economy calls for answers. People need sound, easy-to-follow financial advice that can be implemented immediately. For the first time, a leading financial adviser has developed a remarkable set of guidelines to give individuals the same kind of objective insight into their personal finances that successful businesses have. Your Money Ratios will help readers effectively manage debt, invest prudently, and develop a realistic and effective savings plan to ensure both financial success and security. Readers need only plug their income and age into Farrell's ratios to get an instant picture of their savings status and overall financial health, as well as a road map for the important choices for the future. Some key ratios include:

? The Capital-to-Income Ratio: how much capital (savings) you should have if you plan to retire at 65
? The Mortgage-to-Income Ratio: the maximum mortgage debt you should carry and still have sufficient capital left for comfortable savings
? The Education-to-Average-Income Ratio: the amount of education- related debt you can safely incur based on anticipated average earnings after obtaining your degree

Charles Farrell, J.D., LL.M is principal with Northstar Investment Advisors in Denver, Colorado. His column, "Retirement Roadmap," appears on the CBS Moneywatch site, and his research is frequently cited in The Wall Street Journal and other consumer and professional media outlets.