Testing Your Financial Fitness: Online Resources

Keeping your finances in balance can be challenging, but there are ways to manage and allocate income and expenses using simple online tools and resources. Testing your financial fitness involves evaluating your credit score, determining your income bracket, and finding out what type of debt ratio you have. Debt ratios are used by lenders and other financial institutions to determine your creditworthiness, and if you have become aware about where you stand, it will be much easier to pursue the right type of loan when you need it. If you're looking for ways to improve your finances, or just learn more about your options, here are some online resources that can test your financial fitness:

Goal: Check Your Credit Score

Resource: FreeCreditReport.com

This service is offered by Experian, one of the three major credit bureaus that help to determine your credit score and credit standing. Learning what your credit score is will help you make better financial decisions and pursue the right type of loans; this is a major factor for lenders and creditors when they are considering loaning you money, and there are ways to improve your credit score if you fall below the average. Please note: FreeCreditReport.com services are free for the first report, but work on a subscription basis. If you don't cancel your membership after 30 days, you will be charged $12 for membership so be mindful of your cutoff date when you sign up!

Goal: Determine Your Household Budget

Resource: Kiplinger.com

This budget worksheet can help you separate all of your expenditures into separate categories, and you can keep track of fixed and variable expenses over the course of a year to determine if you fell within an acceptable budget range. It's a simple calculator that you can bookmark to your computer for ongoing use. Outlining your expenses in this way makes it much easier to organize how and where you're spending, and helps you make responsible financial decisions in the process.

Goal: Calculate An Acceptable Mortgage Amount

Resource: MortgagePages.com

When you're in the market for buying a home, you'll need to apply for a loan that is comprised of monthly principle and interest payments. Since interest rates fluctuate on a daily basis, you can estimate your monthly payment by using the current interest rate, amount of loan, and loan duration for your monthly P&I payment. This will help you determine if you can afford to borrow money for your dream home, and makes it much easier to forecast with your budget ranges in mind.

Goal: Determine Your Debt Payoff Abilities

Resource: Bankrate.com

If you are carrying credit card debt, you'll probably have different payoff rates given the interest rates and monthly payment amounts. When you want to learn how long it will take to pay off a particular credit card, use this calculator to see when you can finally be debt-free, and how much you will end up paying over the course of your repayment program. If you're only paying the minimum payment on a high interest credit card, it can take years to become completely debt free; this calculator helps you put your credit card debt in perspective, and may encourage you to make a higher-than-usual monthly payment.

Determining your financial fitness is the first step in effective money management, and there are dozens of tools and calculators available to help you get started. Begin with your credit score, credit standing, and overall household budget to find out what types of loans you qualify for, and where to allocate your income in order to build wealth.