Gearing

If you’re highly geared, it means you have a lot of debt (well, compared to your equity, anyway).

Let’s say you're planning a budget to help yourself determine how much money you have and find ways to cut costs and save money. You look at two different things: the money you have coming in, and the money you owe.

You look at the level between these two amounts, and “gear” up to see what you can do differently. This process helps you determine what kind of risk you have of over-spending. Or the risks you may have when entering into marriage or other long-term relationships.

The term “gearing” is used in the context of businesses, but uses the same logic. The more highly geared a company is, the more it is funded by lenders...as opposed to shareholders. And shareholders, in spite of their name, don’t like sharing power.