Poll: what is your debt to total asset ratio?

[Nemo2]

Un peu de Français... Ça c’est très bien

Au contraire, mon Francais, c'est tragique.

 

[Meadbh]

46%. What do I win?

A medal for bravery!

Results are very interesting so far. Keep them coming! Poll closes in 7 days.

 

[Mulligan]

I guess I am in second place at about 25%. Like a workerbee I have a mortgage with 20 years to go and a car payment slapped on a zero percent CC with 2% access check fee I roll over every 15 months.
The debt was there when I retired and my pension take home income was about same as take home paycheck. No real reason to change. Even with the debt payments I dont spend 70% of my monthly pension income. I am just not a big spender. It will get paid off one of these years, or not...Who knows.

 

[calmloki]

3.255% for one mortgage loan and all the red stuff on the left side of Quicken, which includes everything on our credit cards, which are paid when due each month.

 

[Onward]

21%. Only debt is mortgages on rental properties.

 

[treypar]

It has been zero for last ten years. I sleep better with no debt.

 

[Fermion]

I think we are about negative 10% debt since we actually own some bonds and have no mortgage or CC balances.

 

[WeedWatcher]

Six percent. Small mortgage balance.

 

[panacea]

About 12.5% with 2 car loans (.9% and 1.9%) and a 2.75% mortgage with 8 years left. Don't really like the payments but as Meadbh says, this is "good debt." Our CCs are paid off monthly and racking up the cash back. Love Chase Visa's 5% cash back at warehouse stores (Costco) the last couple quarters! When they give up on that I'll go back to Costo's Citi Visa with 4% back.

 

[Danmar]

So, if we pay our CC balance in full each month, but this month has not yet been paid, does that mean that right now we have debt?

I don't view this as debt. We pay in full as soon as its cutoff. Use to have some margin debt but paid that off shortly after retiring.

 

[jabbahop]

5% until house sells next year then zero.

 

[COcheesehead]

4% mainly due to a note I have on a commercial property.

 

[EastWest Gal]

0.17%. Took out a HELOC in September 2014. Used part of it to put in a new deck and swim spa last year.

I don't count credit cards which are paid off every month.


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[Car-Guy]

I can't vote since the poll doesn't allow for total credits owed to me but only total debts.

My logic is that I do use a credit cards for convenience and for the cash back but I pay them off each month. I guess technically that's debt, but not the way I think of it. The 1.5%+ the credit card companies pay me for using their credit card is a "credit coming to me", not a debt.

I "think" the last time I had any real debt was sometime in the mid to late 90's.

 

[Totoro]

Sure wish I had a cashback credit card available to me.

For us pedantics: the definition intended sounds more actually like total liabilities, not debt. Disclaimer: not an accountant, just read some annual reports.

Debt is typically defined as money loaned from institutions. If your credit card is paid off every money automatically it's actually a deferred debit card, and doesn't qualify as debt normally (but is included in liabilities). Bills outstanding is account payables. There are also things like net debt (debt - cash equivalents).

Not that I really care, it's zero gross debt for me whichever way you go

 

[RetiredGypsy]

I have two cards that offer introductory periods of 0% interest, but have 2-5% cash back rewards. So I'm deferring the cash in paying them back to a savings account that earns .75% until the month the intro period ends. 2.75% interest in my favor on money I'm spending, so woohoo.

2.75% interest sounds a lot better than 2.75% discount. Interesting.

But since I have CC debt, but the same amount of cash as the debt just deferred in paying the bills, where does that put me?

<10%?

0% but just ignore the no CC bill part?

 

[gauss]

~ 1/2% based on the HEL that we obtained to payoff the main mortgage.

At 1.99% I will let it run it course until DW FIRES. The idea was partially to smooth out the cash flow change in our household when DW stops w*rking.

 

[Meadbh]

Sure wish I had a cashback credit card available to me.

For us pedantics: the definition intended sounds more actually like total liabilities, not debt. Disclaimer: not an accountant, just read some annual reports.

Debt is typically defined as money loaned from institutions. If your credit card is paid off every money automatically it's actually a deferred debit card, and doesn't qualify as debt normally (but is included in liabilities). Bills outstanding is account payables. There are also things like net debt (debt - cash equivalents).

Not that I really care, it's zero gross debt for me whichever way you go

Semantics.

What is the difference between liability and debt? | AccountingCoach

Note that I did not ask anyone to include future tax liabilities, because it's just too difficult to estimate what they might be.

I did not include bonds that people own, because bonds represent debt that other people owe you. I am interested in debt that you owe other people.

 

[Totoro]

If you want liabilities: ignore the cash set aside, add in CC balance

For gross debt: same thing. You have credit, just an intention to pay it off.

For net debt: subtract all cash equivalents.

On the asset side: everything you have, including the net present value of any pensions Although I think Meadbh would probably exclude that last bit.

 

[prototype]

No debt. (Except CC charges which are auto payed each month on due date). So I also voted no debt.

 

[frayne]

Pretty amazing stat that 90% who answered the poll have little to no debt. Wonder if there is a correlation between FIRE and debt, wonder no more !

 

[RockyMtn]

Debt=zero, zip, nada!

 

[GTFan]

Debt? What's that? Haven't had a loan in at least 15 years.

 

[Meadbh]

Pretty amazing stat that 90% who answered the poll have little to no debt. Wonder if there is a correlation between FIRE and debt, wonder no more !

In fairness, many people who said they had "no debt" admit to having credit cards that they pay off each month. I would call that current debt. But whatever. I am also surprised at the overwhelming majority of respondents to date who say their debt ratio is <10%. I suspect that if more young people responded, that picture might change.

 

[MichaelB]

In fairness, many people who said they had "no debt" admit to having credit cards that they pay off each month. I would call that current debt.

Sounds like a good question for a poll http://www.early-retirement.org/for...edit-card-charges-debt-83551.html#post1784340