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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%
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Poll: Are current credit card charges debt?
Old 09-25-2016, 11:48 AM   #1
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Poll: Are current credit card charges debt?

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?
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Old 09-25-2016, 11:53 AM   #2
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Yes. You owe this money and must pay it back in the future.
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Old 09-25-2016, 12:08 PM   #3
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Well, since this is related to a net worth question, then yes....


So, say you have $10,000 cash and $2,000 CC debt.... if someone asked you your net worth, if you ignored the CC debt then you would say $10,000...


However, we all know that the net worth is only $8,000.....


You can either list it as debt or reduce your 'cash' for the payment that you will have to make within the next month... any other way and you are fooling yourself...

BTW, I have $7K of CC debt right now.. ... DW has been booking trips etc. and it is way out of hand....
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Old 09-25-2016, 12:09 PM   #4
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I would say yes, but only for up to 30 days.
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Old 09-25-2016, 12:11 PM   #5
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Yes, of course, they are unsecured debt.

https://en.m.wikipedia.org/wiki/Credit_card_debt

"Debt results when a client of a credit card company purchases an item or service through the card system."

What the heck else would they be?
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Old 09-25-2016, 12:16 PM   #6
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Originally Posted by MichaelB View Post
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?
Technically yes, but in practice "no" if paid in full each month with no carrying/finance charges. If it is debt, to me everyone would have debt. Example, my monthly electric and water bills are based on usage playable only "after" I use it. Is that debt? Technically yes, but not really for practical purposes.
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Old 09-25-2016, 12:18 PM   #7
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Splitting hairs, but the way I look at it is that I don't actually "owe" the money to the CC until the due date. Since I pay it off by that date (if not a little before), then I not only don't owe the money, but in most cases I'll be rewarded for using the card.

I know that technically that's incorrect, but I can't help seeing it that way.
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Old 09-25-2016, 12:23 PM   #8
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ONLY if you hold a balance, we do not, so No.
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Old 09-25-2016, 12:25 PM   #9
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Splitting hairs, but the way I look at it is that I don't actually "owe" the money to the CC until the due date. Since I pay it off by that date (if not a little before), then I not only don't owe the money, but in most cases I'll be rewarded for using the card.

I know that technically that's incorrect, but I can't help seeing it that way.
GMTA. This is my view as well. The way we use it in our discussions here, credit cards are used even when we have the cash because we get some of the money back, it makes for easier and more complete record keeping, and gives us some consumer protections that we otherwise might not have.

So, I have a credit card balance that effectively is a debit card balance and the CC company chooses to debit once a month at a predetermined date rather than when I incur the charge.
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Old 09-25-2016, 12:25 PM   #10
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Splitting hairs, but the way I look at it is that I don't actually "owe" the money to the CC until the due date. Since I pay it off by that date (if not a little before), then I not only don't owe the money, but in most cases I'll be rewarded for using the card.

I know that technically that's incorrect, but I can't help seeing it that way.
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Technically yes, but in practice "no" if paid in full each month with no carrying charges.

This is how we view it......otherwise anyone who uses a credit card for a purchase, and doesn't simultaneously remit the funds to the credit card company, has 'debt'...even before said debt is officially posted.
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Old 09-25-2016, 12:31 PM   #11
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This is how we view it......otherwise anyone who uses a credit card for a purchase, and doesn't simultaneously remit the funds to the credit card company, has 'debt'...even before said debt is officially posted.
Well, you do have debt once you have used the credit card to purchase something. If you die, your executor's first job wil be to pay off your debts, including your current credit card debt.
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Old 09-25-2016, 12:34 PM   #12
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I voted no, because I could return the item and get a credit in the very same statement.
Also because I carry so little CC charges, since I pay my CC off every 2 weeks, that it's an insignificant amount.
Whenever I have used my CC on a big purchase, I pay it off within days after it shows on the CC.

Why do I pay off my CC so much ?
Because then when I look at my bank balance, I know pretty much all that $ is mine.
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Old 09-25-2016, 12:35 PM   #13
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Lemme get this straight.

I pay for your dinner and you promise to pay me back for it in 30 days. And you think you are not indebted to me?

It's debt. Not bad debt, but debt none the less.
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Old 09-25-2016, 12:35 PM   #14
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No need to break out the accounting textbooks. I think most would agree that any unpaid CC balance is technically a debt that must be repaid. But when it's paid off in full every month, with no interest charges, and usually a cash back credit or some other reward, this is hardly "debt" in the usual sense, or in context of the prior poll (at least that's my interpretation of the intent of the prior poll). More importantly, the lowest level answer for that poll was "<10%" of total assets. My average unpaid CC balance is 0.14%. I would think others who just use CCs for cash back rewards, would be similarly low. So answering "<10%" would be grossly misleading IMHO. I answered that poll, "no debt" and this one "no."
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Old 09-25-2016, 12:36 PM   #15
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Well, you do have debt once you have used the credit card to purchase something. If you die, your executor's first job wil be to pay off your debts, including your current credit card debt.
Which is why I specified simultaneously.......i.e. if you make a $50 CC purchase, you'd have to, in the same microsecond, transfer an equal amount to your CC account.
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Old 09-25-2016, 12:41 PM   #16
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Theologians and Engineers might be killing each other over this question, even as we speak.


BTW, what is the definition of 'current' in this context? (I tried calling Bill Clinton...but to no avail.)
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Old 09-25-2016, 12:43 PM   #17
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No. - current charges, ones which one plans to pay before their due date with no carry-balance, no interest, should not be considered "debt" for the purposes of determining ones total indebtedness.

I could and would pay cash and/or debit card for these expenses, and would if there were interest on day 1 or any of the other implications of debt. I choose to use the credit card for convenience, points, cash back, etc. I'm not using credit for the purpose of debt or delaying payment, but for the perks only.

If you want to get technical, sure, it's debt, but i answered zero on the debt to assets ratio based on what I consider debt and not, as above.
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Old 09-25-2016, 12:43 PM   #18
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More importantly, the lowest level answer for that poll was "<10%" of total assets.
Actually, the lowest level answer was:

I have no debt whatsoever, not even a credit card bill.
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Old 09-25-2016, 12:45 PM   #19
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BTW, what is the definition of 'current' in this context?
Payable within one year.
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Old 09-25-2016, 12:46 PM   #20
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I don't consider anything I can pay off instantly a debt. I use credit cards only because they are easy not because I don't have the money and "need credit".

Didn't see it mentioned earlier but the rest of the work considers it debt. I went for a mortgage once ... 1998 I think... filled out papers. Asked if I had any current debt. I check "no". Then they noticed the $19.99 dial-up internet modem monthly charge on one of my cards They had a problem with A) the debt and B) the fact that I seemed to lie about it even tho they all knew exactly what it was because they all did the same thing themselves. That's how we used to pay for internet in the stone age. Loan rules had not changed to match the technology. I don't know if they have today.
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