Debt ratio
DebtsThe numbers shown come from a sample profile for illustration – in the calculator you see your own values.
The debt ratio shows your debts relative to your gross assets. It indicates how heavily your wealth is "burdened" by borrowed money. FireLotse uses net worth for all FIRE calculations – with a high debt ratio, looking only at gross assets would overstate your financial freedom.
Orientation:A debt ratio above 50% means more than half of your wealth still belongs to the bank. Borrowing can make sense if the loan interest is reliably below the expected portfolio return (typically: cheap mortgages with a long fixed-rate period). For high-interest consumer debt (overdraft, installment loan, credit card), however, the debt veto applies: always repay before investing.
How it is calculated
Debt ratio = (total debts ÷ gross assets) × 100
Good to know
Traffic light:Under 20% = good · 20–50% = keep an eye on it · Over 50% = critical