Updated: Apr 11, 2020
What’s considered a debt, and Why is this important in setting my budget? According to Investopedia.com, "Debt is an amount of money borrowed by one party from another…[and] gives the borrowing party permission to borrow money under the condition that it is to be paid back at a later date, usually with interest."
Basically, debt is money that you’ve borrowed that, when paid back, usually has interest added to the payment. Living expenses don’t have interest associated with the payment. Instead, it’s simply an expense that must be paid to uphold a certain standard of living.
Take a look at this video for more information and examples.