📈 How to Improve Your Financial Health Score in Hedgi

Simple actions that strengthen your books — and your business.

Your Financial Health Score in Hedgi is a smart snapshot of how efficiently you’re running your business. It combines cash flow, savings, expenses, and bookkeeping accuracy into a single number (0–100) — and the good news is, you can improve it.

This guide shows you how.

🔍 First: Understand What Affects Your Score

Hedgi calculates your score using four components:

• Cash Flow Score (35%) — Are you earning more than you spend?

• Savings Score (30%) — How much profit are you keeping?

• Expense Score (20%) — Are your costs in check relative to income?

• Categorization Score (15%) — Are your transactions properly organized?

Now let’s break down how to improve each part.

💸 1. Boost Your Cash Flow Score

What it measures:
Net income (income minus expenses) as a % of income

How to improve:

• Raise prices if your margins are thin

• Collect payments faster to increase cash inflow

• Cut low-ROI spending (see Hedgi’s “Where to Save” insight prompt)

• Pause or renegotiate recurring bills like software, phone, or insurance

Target: Net income ≥ 20–35% of income is considered strong

💰 2. Raise Your Savings Score

What it measures:
How much of your income you actually kept (profit)

How to improve:

• Avoid zero-profit months by reviewing spending before each billing cycle

• Reduce variable costs like meals, travel, and supplies

• Reinvest smarter — save before you spend

• Use the AI Assistant to identify your most expensive categories

Target: Save at least 10–20% of monthly income

🧾 3. Lower Your Expense Ratio

What it measures:
Expenses divided by income

How to improve:

• Watch for high fixed costs — if income drops, they hurt more

• Group purchases (e.g., Amazon) can sneak up — check categorization

• Use Hedgi’s “Recurring Bills” and “Duplicate Subscriptions” tools to cut bloat

• If expenses > income, aim to correct that within the month

Target: Keep expenses under 65% of income when possible

🧠 4. Improve Your Categorization Score

What it measures:
% of your transactions that have been categorized

How to improve:

• Review the “Needs Categorization” filter monthly

• Add a rule for any vendor you reclassify more than once

• Accept suggested categories if they look good — they’re counted

• Leave memos for mixed-use expenses (this helps Agentic accuracy too)

Target: Aim for 90–100% categorized every month

🎯 Final Tips to Stay Above 80

• Check your AI Health tab regularly to fix low-confidence entries

• Review your biggest categories monthly

• Keep rules updated — they lock in consistent logic

• Aim for high margin and high organization — Hedgi rewards both

✅ Bottom Line

Improving your Financial Health Score isn’t about perfection — it’s about habits.

• Clean, categorized books

• Healthy profit margins

• Smart, intentional spending

Do that consistently, and your score (and business) will stay strong.