Anna’s net income is $40,000 per year. What is the most she should spend towards housing each year?
The standard seems to be to spend no more than 30% of your income for housing.
0.3 * 40,000 = ?
http://forums.kiplinger.com/showthread.php?3321-What-percentage-of-income-should-go-to-housing
To determine the most Anna should spend towards housing, we can look at the general guideline of the 30% rule. According to this rule, it is recommended that no more than 30% of one's income should be spent on housing expenses.
To calculate the amount Anna should spend on housing annually, we can use the following formula:
Housing expense = (Percentage allocated for housing / 100) * Net income
Substituting the given values:
Housing expense = (30 / 100) * $40,000
Calculating the result:
Housing expense = 0.3 * $40,000
Housing expense = $12,000
Therefore, the most Anna should spend towards housing each year is $12,000.