debt 2.docx - 20/10 Rule More Practice – 2 Never borrow...

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20/10 Rule More Practice – 2 Never borrow more than 20% of your annual net income, or let monthly debt payments exceed 10% of your monthly income. 1. Chase’s net income is $60,000 per year. What is the maximum amount of debt that he could safely carry? 2. You make $50,000 per year. What is the maximum debt that you should have? 3. You bring home $3000 per month. What is the most you can safely pay every month for you debt? 4. Rachel makes $2200 after taxes every month. What is the most she should spend every month on payments for her debts (credit cards, car loans, student loans, personal loans, etc) 3. Janice has a monthly net income of $1400. Her rent payment is $445 per month and she has a student loan payment of $120 per month. She wants to buy a system for her car using her credit card. What is the highest monthly payment for the sound system that Janice can safely afford? It is asking about monthly payments, so you use 10% The first step is to
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