At Tendi, we believe financial health should be as easy to track as your credit score. That’s why we’re thrilled to introduce the Financial Health Index (FHI)—a comprehensive, easy-to-understand metric that evaluates an individual’s financial well-being on a 0–100 scale. Unlike traditional credit scores that only assess debt and repayment history, the FHI provides a holistic view of financial health by incorporating income, savings, investments, debt, and net worth. Even better? We’re open-sourcing the formula so anyone can use it to measure and improve their financial situation.
What is the Financial Health Index (FHI)?
The FHI is a single numerical score designed to represent your overall financial health. A higher score indicates stronger financial stability and future readiness, while a lower score highlights areas needing improvement. It’s a dynamic metric that changes over time as you build savings, pay off debt, and grow investments.
The FHI formula integrates six key financial factors:
- Net Worth – The total value of your assets minus liabilities.
- Debt-to-Income Ratio (DTI) – The proportion of your monthly income dedicated to debt payments.
- Savings Rate – The percentage of your income saved each month.
- Investment Health – The amount of investments relative to income and life stage.
- Emergency Fund – The number of months’ worth of expenses saved for unforeseen situations.
- Other Stability Factors – Job security, insurance coverage, and other financial safety nets.
By analyzing these areas, the FHI empowers users with actionable insights into their financial strengths and weaknesses.
Why the FHI Matters
Traditional financial metrics—like credit scores and net worth—don’t tell the full story. The FHI is different because it:
- Provides a holistic snapshot of financial well-being, not just borrowing habits.
- Offers personalized insights on how to improve your financial health.
- Tracks progress over time, helping individuals measure financial growth month over month.
- Is open-source, allowing financial platforms, fintech apps, and individuals to integrate and customize the metric.
How Tendi Uses the FHI
The FHI is deeply integrated into the Tendi platform, allowing users to monitor their financial health in real-time. By linking financial accounts, Tendi automatically calculates your FHI score and provides customized recommendations to improve it. Whether it’s optimizing your savings strategy, reducing debt, or increasing investments, Tendi guides you step by step.
Open-Sourcing the FHI Formula
We’re making the FHI open-source so that anyone—financial advisors, fintech developers, and individuals—can leverage it. We believe that financial health should be transparent, measurable, and accessible to all. The formula is available for use, and we encourage community contributions to refine and enhance it over time.
Take Control of Your Financial Future
The Financial Health Index (FHI) is more than just a number—it’s a powerful tool to help you make better financial decisions and track your progress toward financial freedom. Join us in revolutionizing personal finance by adopting the FHI and taking control of your financial well-being.
Want to see your FHI score in action? Sign up for Tendi today and start your journey toward financial success!
