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Yeah, that's my point, I view it as a debt and not an expense. Expenses are for businesses so they can figure out their operating costs.
If you change the normal meanings of words, you should mention it in any discussion. If I were you, I'd simply have expense, expense', debt, and debt' in order to be unambiguous.
Put another way, you're playing semantic games here, not introducing an idea with great profundity!
Quote:
Originally Posted by eyeb
For individuals, we don't have "operating" costs but a living costs. We can live without a TV, it's not required, if we want it, we can't expense it on a tax form, we incur the debt of operating it.
You mean the debt'.
Quote:
Originally Posted by eyeb
My needing a car to get to work, counts as an operating expense since I need it to obtain an income. The car debt part of it is how much of a car I decide I need, as in do I need to borrow money against what I have or can I buy it all myself?
If you have a loan outstanding, then you have debt. Nothing new here.
Location: New Albany, Indiana (Greater Louisville)
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For the record most Milennials I know are quite frugal. Most don't have cable tv but only internet service. We don't spend $800 for brand new smart phones we get a new but older one for free when we renew our cell phone contract. Most live in cheap apartments. The few of us that can afford a house buy a cheap, usually older one. We drive small / cheap / efficient cars. Most that I know have little to no credit card debt.
College loan debt is the main problem. I went thinking I'd make $40,000 a year starting out. If I knew I'd start at $13 an hour and be stuck at company that cuts off annual raises for everyone at $39k I would have only done community college
why have a family with only one car, but 2 or 3
dont buy a fuel efficient car buy the biggest baddest suv you can find
dont walk down the street to see someone drive that gas gussler (and complain when gas goes up 5 cent)
waste your money on bottled water(its only tap water),and you can never have enough $5 cups of coffee,
spend your money on vices like smoking, lottery tickets
have a large tv in every room and a computer for everyone
buy a house that is way over your budget
go to as many movies as you can, enjoy that $10 bag of popcaorn (which costs the theater a few cents)
and for the kids-remember junior needs those $200 pair of designer sneakers or he'll be laughed at in school
buy all the latest video games for him,
have as many credit cards as you wallet can handle,run out of space just buy a bigger wallet.
and by all means complain all day long that you need two jobs just to make ends meet.
The one reason that Americans are so much in debt is a monetary policy which punishes savings and rewards indebtedness.
When the value of your take home pay is being eroded by inflation, you do not have any incentive to save it because it will buy less in 6 mos. than it does today.
Likewise, if you go into debt to purchase a large ticket item such as a home, it will be worth more than you paid for it at some point down the road.
People have been sold the culture of happiness through materialism, and now believe they are only a new car or a 60" TV away from being able to buy their happiness.
The banks create the inflationary fiat money policy, and they benefit from the income stream created by the interest that Americans pay on nearly every item that they purchase.
If people understood investing in the long run, they would not have this problem. The TV you buy today might not be working in 15 years but the stocks you buy today are likely to be worth more in 15 years even after inflation although the ride there could be bumpy.
If people understood investing in the long run, they would not have this problem. The TV you buy today might not be working in 15 years but the stocks you buy today are likely to be worth more in 15 years even after inflation although the ride there could be bumpy.
but you cannot watch comedy shows on your stock portfolio!
When the value of your take home pay is being eroded by inflation, you do not have any incentive to save it because it will buy less in 6 mos. than it does today.
Isn't this the primary reason why people should invest? If you believe that inflation will make the dollar worth less in the future, why not buy the stock now while you have more buying power?
@ncole1, no I don't see what you mean by your debt' ? Not sure what you mean by that really. I mean people consider credit card payments as debt. If I can charge my phone/internet/cable bill to a credit card, why do you not consider those items of debt as well? I don't know how you argue that those items are an expense when they by the nature of you spending money is creating a debt since it is money you no longer have.
Isn't this the primary reason why people should invest? If you believe that inflation will make the dollar worth less in the future, why not buy the stock now while you have more buying power?
@ncole1, no I don't mind your debt'? Not sure what you mean by that really. I mean people consider credit card payments as debt. If I can charge my phone/internet/cable bill to a credit card, why do you not consider those items of debt as well? I don't know how you argue that those items are an expense when they by the nature of you spending money is creating a debt since it is money you no longer have.
Right, but in the latter case you don't owe anyone any money because you already paid.
So, you are saying debt is only occurs while you owe money on it? Again, I don't see how this applies, I don't use a prepaid cable plan, phone plan or internet plan. All of them are I use it and at end of the month I pay the bill on it. Until I paid them off at the end of the month, they are a debt. And as long as I keep the plans, that debt will keep reoccurring as well.
An expense is more of a one time fee to me, like I buy a TV outright, I don't have to keep making payments on it for as long as I want to use it. But if you want to keep using the cable/phone/internet service, there is an ongoing debt. Or food expenses, I don't buy a bag of fruit then have the store keep charging me until I eat them all.
the difference that I think we are arguing on is the time frame. I think you mean debt is carried out through multiple payments with interest, my interpretation is that the services create monthly debts that most people pay off each month or they get cut off. But they still owe the money on it if they want the service back later. I see debt as if you owe someone money for even a second, it is still debt until it is paid off, which once paid off becomes an expense
So, you are saying debt is only occurs while you owe money on it? Again, I don't see how this applies, I don't use a prepaid cable plan, phone plan or internet plan. All of them are I use it and at end of the month I pay the bill on it. Until I paid them off at the end of the month, they are a debt. And as long as I keep the plans, that debt will keep reoccurring as well.
An expense is more of a one time fee to me, like I buy a TV outright, I don't have to keep making payments on it for as long as I want to use it. But if you want to keep using the cable/phone/internet service, there is an ongoing debt. Or food expenses, I don't buy a bag of fruit then have the store keep charging me until I eat them all.
the difference that I think we are arguing on is the time frame. I think you mean debt is carried out through multiple payments with interest, my interpretation is that the services create monthly debts that most people pay off each month or they get cut off. But they still owe the money on it if they want the service back later. I see debt as if you owe someone money for even a second, it is still debt until it is paid off, which once paid off becomes an expense
A debt is when you owe a set amount of money and are postponing paying a cost you already incurred and know.
A utility bill is a variable expense, unless you are behind, in which case it becomes a debt, since it is then a fixed obligation for a past service you have delayed paying for.
Did you just argue that it is only an expense if you stay on top of it? So if I stay on top of a mortgage, it is an expense and not a debt? A debt is a debt when you owe money on something. By having the service, you owe money, it is a debt until it is paid then it is an expense. It doesn't work the other way around in my book.
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