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View Poll Results: Are credit card charges the same as debt
Yes, current credit card charges are the same as debt 67 41.36%
No, current credit card charges are not the same 88 54.32%
Another poll? Really? Too busy to answer 7 4.32%
Voters: 162. You may not vote on this poll

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Old 09-25-2016, 11:47 AM   #21
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Hmmm... I consider it debt. There may not be interest associated with it since you pay it off at the end of the billing period - but it's debt.

I think the polls talked about "investable assets" rather than net worth... My credit card debt and my cash accounts (checking/savings) are not included in my investible assets but are included in my net worth.

I'm taking an accounting class right now and it's pretty clear what the official way to do it is... Accounts payable (credit cards included) are a liability. That liability goes to zero when you pay it in full, but your cash balance also takes a hit.
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Old 09-25-2016, 11:48 AM   #22
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Quote:
Originally Posted by rodi View Post
Hmmm... I consider it debt. There may not be interest associated with it since you pay it off at the end of the billing period - but it's debt.

I think the polls talked about "investable assets" rather than net worth... My credit card debt and my cash accounts (checking/savings) are not included in my investible assets but are included in my net worth.

I'm taking an accounting class right now and it's pretty clear what the official way to do it is... Accounts payable (credit cards included) are a liability. That liability goes to zero when you pay it in full, but your cash balance also takes a hit.
Thank you rodi. Finally someone who gets it!
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Old 09-25-2016, 11:52 AM   #23
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The poll could be modified to reflect outstanding debt.......although someone, (probably me), would say "That's not outstanding, it's quite normal".
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Old 09-25-2016, 11:53 AM   #24
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It is technically debt of course. But if you pay it off every month, it's more like a payment mechanism. If significant and you are calculating your net worth, you should include. Having said that, I certainly consider myself debt free because this is my only debt and I always have the cash to pay it in full. Having a few thousand dollars in current CC charges that will be paid by the due date, does not (in my view) mean you are "in debt". If you were nobody would ever be debt free. Must be a slow day?
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Old 09-25-2016, 11:55 AM   #25
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If I go to a store to obtain something, then I must either pay cash for it, promise to pay for it later (credit) or steal it. If I promise to pay for it later (credit) and don't, then I am going to be in trouble. I do consider it credit. However, I don't worry about it, because I pay off our credit cards in full each month. Sometimes, I pay for purchases ahead of time. We just took a trip to Canada and Maine and we owed less than $2000.00 on Discover and I paid $5000.00 to have some leeway. Our 6 day schooner trip was already paid in full. We came home for 3 days and left for NC and again I paid ahead some. I like the credit card rewards too!
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Old 09-25-2016, 11:56 AM   #26
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Must be a slow day?
No, it's just because there are not any "good" football games on TV at this time.
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Old 09-25-2016, 12:00 PM   #27
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I think the polls talked about "investable assets" rather than net worth...
Do you then include future stock dividends, payable within a year by the companies with whom you hold shares, as part of your net worth?

(How many credit card holders can dance on the head of a pin?)
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Old 09-25-2016, 12:00 PM   #28
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BTW, what is the definition of 'current' in this context? (I tried calling Bill Clinton...but to no avail.)
Try Monica's number.
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Old 09-25-2016, 12:03 PM   #29
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Actually, the lowest level answer was:

I have no debt whatsoever, not even a credit card bill.
I think you know what I meant. I'm talking about someone with an unpaid CC balance, no matter how inconsequential relative to total assets... the lowest level answer was in fact "<10%." Given the number of respondents/commenters whose only "debt" was small CC balances paid in full monthly, that poll choice was too broad.
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Old 09-25-2016, 12:05 PM   #30
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If a "not yet due" credit card balance is not yet an obligation, how can it be considered debt? If I charge an item and transfer the cash to my payment account, and the credit card company has not yet billed it and chooses to delay withdrawing the funds, this is a liability but not a debt. It becomes debt once it is billed.

If we want to get technical and look at corporate finance, it would probably be considered an "accrued expense", but might be "accounts payable" or "trade and other payables".
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Old 09-25-2016, 12:11 PM   #31
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No, it's just because there are not any "good" football games on TV at this time.
Watching the Bills/Cards game. Wow, the Cards are getting slaughtered.
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Old 09-25-2016, 12:11 PM   #32
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Yes, All credit card charges are debt from the time that they are charged on the credit card to the date that they are paid. Credit card expenditures are considered current liabilities for business accounting purposes. Same for individuals. If not, then the business schools have been teaching this wrong for decades.
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Old 09-25-2016, 12:12 PM   #33
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I mean, if we want to count the angels on a pinhead, writing a check is a form of debt, too. So is using fiat currency itself, really, so how far do we want to take this? If I pay off my CCs before I have to pay interest and I get some travel points to boot, it's a loan but one they pay me a little to take and I'm happy.
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Old 09-25-2016, 12:15 PM   #34
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It seems to be an unsettled question over at this poll, so I thought it might make a reasonable new poll question.

So, if you pay your credit card balance each month in full, is the current, not yet paid and not yet due balance considered debt?
Well I'm glad this new poll settled that question.
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Old 09-25-2016, 12:16 PM   #35
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Well I'm glad this new poll settled that question.
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Old 09-25-2016, 12:33 PM   #36
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It doesn't matter because my net worth calculation includes all my outstanding credit card balances that I pay off in full. It's just cash flow to me. I have other bills I owe and get charged after the fact. 30 days is a pretty normal period of elasticity as far as paying due bills is concerned,
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Old 09-25-2016, 12:40 PM   #37
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If the credit credit is paid off in full each month, there is no debt, at least in my way of thinking.
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Old 09-25-2016, 12:45 PM   #38
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It is technically debt of course. But if you pay it off every month, it's more like a payment mechanism. If significant and you are calculating your net worth, you should include. Having said that, I certainly consider myself debt free because this is my only debt and I always have the cash to pay it in full. Having a few thousand dollars in current CC charges that will be paid by the due date, does not (in my view) mean you are "in debt". If you were nobody would ever be debt free. Must be a slow day?


My view exactly... Only a credit company pulling your file on a date you had money on the CC that day would view it differently. I know its a slow day for me... Im posting while struggling to watch my Ravens season over bet play out against boring Jaguars...
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Old 09-25-2016, 12:48 PM   #39
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If a "not yet due" credit card balance is not yet an obligation, how can it be considered debt? If I charge an item and transfer the cash to my payment account, and the credit card company has not yet billed it and chooses to delay withdrawing the funds, this is a liability but not a debt. It becomes debt once it is billed.

If we want to get technical and look at corporate finance, it would probably be considered an "accrued expense", but might be "accounts payable" or "trade and other payables".


Michael, you better take it down a notch or an academic nerd fest food fight is going to break out soon.
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Old 09-25-2016, 12:52 PM   #40
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I know its a slow day for me... Im posting while struggling to watch my Ravens season over bet play out against boring Jaguars...
Slow day for me too since I have no bets on any of today's games. Made my weekly "donation" Thursday night. But to try and stay on topic of this thread, I still have no debt since the "cash" (no credit cards accepted) was paid to the pot before the game.
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