Post # 17
We put everything on FI’s amex and pay it at the end of the month. 🙂 It earns us great rewards, why would we use cash?
I don’t consider that debt. The money is in the accounts to pay it off. And we don’t incurr any interest charges.
Post # 18
I don’t consider that debt. We use it deliberately to get airline miles. We could just as easily switch to debit.
Post # 19
debt is something that is owed to a creditor. so the credit card company is lending you the money and paying the store. when i buy a metro card, the metro becomes in debt to me because i have lent it $20 or whatever i put on my card.
interest is a FEE that is applied for the credit they are giving you. Even if i pay my electric bill today, i am in debt to them for the electricity they provide until they send me my next bill.
Post # 20
I don’t consider it debt. Fiance uses his CC for everything and then pays it off. He feels like there is an added security by only using his CC rather than his debit card (I think he feels this way after my wallet got stolen and someone used my debit card). He has more than enough cash to cover his CC payments.
Post # 21
Umm No, we use our credit cards for everything and then pay them off every month. They are points cards so we use the points to get free gift cards and stuff every year. 🙂
Post # 22
Yes! The protection thing is huge too. If there’s any issues with a vendor the credit card will usually back you. If someone steals your CC number, they reverse right away and you’re not really effected. If someone steals your debit card and takes cash out, that’s actual money you have to wait to get back. And most Visa cards (most cards actually I think) offer a double warrenty protection on goods purchased with their card. For example, I bought a tablet with a standard 1 year warranty, which crashed and refused to boot 1.5 years later. With the doublt warranty protection, my credit card actually refunded me the full purchases price (cause it was too expensive to fix) toward a new tablet.
Post # 23
I don’t consider it debt, because we don’t spend more on our CC than we’re able to pay back before the end of our billing cycle.
Post # 24
Unless it’s a cash advance, no interest accrues until the payment due date. So, no, it isn’t debt, it’s just a method of payment.
Post # 25
It’s just a matter of accounting, and how you slot things into which column… it’s fine not to consider it debt, as long as you consider that your chequing account, or whatever account the payment will come out of, is actually $1000 less than it is. So you can consider you have $5000 in your chequing account and $1000 in debt, or you can just say that’s no debt but consider that you have $4000 in cash. It all adds up to the same thing! What’s dangerous is when people have $3000 owing on their credit card, $3000 in the chequing account, and consider that because they still have cash in their chequing they have money and can keep spending.
Post # 26
No, I would not consider it debt. I would consider it debt if you carry it over. I use mine for almost all monthly expenses. I still stick to a budget though.
Post # 27
Nope! I buy everything possible on credit card but I never buy anything I can’t pay for in cash. I pay off my credit cards with every paycheque, actually – I should probably wait until my next statement to earn what little interest there is to earn, but oh well. 😛 Better safe than sorry!
Post # 28
Maybe they don’t mean the full balance, but just the minimum amount owed? It’s not debt if you pay it on time.
Post # 29
Although it would appear that ‘debt’ has a different meaning in everyday life! As opposed to its technical definition, I mean… 🙂
Post # 30
Agreed, it’s not debt if you pay it in full each month.
Using credit cards this way (correctly) is smart. You’re protected and you can get rewards points towards good things or cash back.
Post # 31
No. I put every expense I can on my United Airlines credit card and pay it in full every statement. I get the rewards, lounge passes, miles, etc and don’t lose any money on it.
This only works if you’re pretty responsible and know you have the money available to pay it off.