You have a credit card that has a balance of $3,589.90 and a credit limit of $5,000. How much is the balance over the acceptable debt ratio percentage?
To find out how much the balance is over the acceptable debt ratio percentage, we first need to calculate the debt ratio percentage.
The debt ratio is calculated by dividing the credit card balance by the credit limit and then multiplying by 100 to get a percentage.
Debt Ratio = (Credit Card Balance / Credit Limit) * 100
In this case, the credit card balance is $3,589.90 and the credit limit is $5,000.
Debt Ratio = (3,589.90 / 5,000) * 100
Debt Ratio = 0.71798 * 100
Debt Ratio = 71.798%
The generally acceptable debt ratio percentage for credit cards is considered to be 30% or lower.
To find out how much the balance is over the acceptable debt ratio percentage, we subtract the acceptable debt ratio percentage from the current debt ratio percentage.
Excess Debt Ratio = Current Debt Ratio - Acceptable Debt Ratio
Excess Debt Ratio = 71.798% - 30%
Excess Debt Ratio = 41.798%
Therefore, the balance on the credit card is 41.798% over the generally acceptable debt ratio percentage.