topic Re: What would you consider "debt"? in General Credit Topics

What would you consider "debt"?

squirrely2005 — Sat, 25 Aug 2012 05:20:23 GMT

I know the definition but I guess I mean what amount of debt do you feel comfortable with having out? I'm on track to paying everything off by at least mid November. I was hoping by mid October but looking at the numbers now I'm not sure. I've been paying off(between me and my gf) 500 every 2 weeks. It's just exhausting being broke all the time though.

I just have this thing about me that I hate oweing people. I still feel like I have to pay someone back from freshman year in hs. haha

So should I get down to totally zero or should I be comfortable at a small balance of about 500 on one card and take time to pay it off without stress? It would be my nfcu 5k Cl card that would carry the balance.

Re: What would you consider "debt"?

Odiseous — Sat, 25 Aug 2012 05:27:05 GMT

This is an almost open ended question..

Are you refering to CC debt, student loan debt, mortgage debt, car loans, etc..?

I have different numbers for all.

For example:

Credit Cards: > 9% reporting (PIF)

Student Loans: N/A for me

Mortgage: Within reason

Car Loan: Again, within reason

Re: What would you consider "debt"?

squirrely2005 — Sat, 25 Aug 2012 05:56:59 GMT

Sorry I should have been more clear. I really just mean credit card. A car loan is debt but in my head I just don't consider it that. Like I wouldn't consider a phone bill or cable bill debt. It's just a bill. Different I know but still.

Re: What would you consider "debt"?

CreviceTool — Sat, 25 Aug 2012 06:18:41 GMT

squirrely2005 wrote:

So should I get down to totally zero or should I be comfortable at a small balance of about 500 on one card and take time to pay it off without stress? It would be my nfcu 5k Cl card that would carry the balance.

Obviously that's completely up to you. But to me, the question is: are you paying interest on it? I presume so, so I would work towards paying it off. Personally, I don't carry any debt with the exception of my mortgage. But at least that interest is tax deductable. I do utilize credit, but I PIF every month before interest applies.

Re: What would you consider "debt"?

squirrely2005 — Sat, 25 Aug 2012 06:26:26 GMT

Obviously. And I don't mean that in a rude smart ass way. Thanks for the input. I know I should avoid all interest I can.

Is there anybody that is actually ok with paying a little interest every now and then?

Re: What would you consider "debt"?

Revelate — Sat, 25 Aug 2012 08:37:35 GMT

squirrely2005 wrote:
Obviously. And I don't mean that in a rude smart ass way. Thanks for the input. I know I should avoid all interest I can.
Is there anybody that is actually ok with paying a little interest every now and then?

I am, but my situation might be a little more unique than others. Until recently, I haven't had a steady job for a while, and as a result I've either been making a good chunk of cash, or having nothing coming in.

As a result, when I'm out of work, I tend to float my balances on my cards and simply make slightly more than the minimum payments and accepting the financing (call it 2% monthly though that's high even with my subprime credit cards) until I have income coming in. It's worth it to me to be able to push my rent marker out an extra few months if things go hugely worse than I expect.... giving me time to go find another gig, or at least something to pay the bills. Once I have income though, I hammer my balances ASAP to the exclusion of pretty much any other concerns besides other bills and food. Well, that and building some additional cash reserve: I'm going to probably wind up with $2700 on my BOFA card at the end of this next statement, on which I've already transferred $2K to my BOFA account which I'm going to kick to the card, and after paying rent I should still have $2400ish in the bank, or two additional months rent. Sad to say, but I pretty much measure my slush fund in how many rent checks it covers :).

Anyway, I don't see the point of paying interest for no reason; however, sometimes sacrificing a few hundred in a given year is a more financially defensible position than not, though admittedly it's suboptimal compared to being able to regularly pay things off.

Re: What would you consider "debt"?

Cloudlb — Sun, 26 Aug 2012 20:28:24 GMT

What amount of credit card debt am I comfortable with? No more than I can pay off in a month, unless it's special no interest terms on a big purchase. Anything more, and I can't afford whatever it is.