Understanding credit

Which one is considered a danger of using a credit card?

• no cash needed

• paying back more than you borrowed

• convenient

• earning rewards

What is credit?

• Free money
• Borrowed money
• Standard of living
• A term that causes tears

What is one of the purposes of credit?

• To borrow money when you do not have enough to pay for what you want/need

• To get into the college or university of your choice

• To compare yourself to your friends.

• To give to charities

If you cannot pay back a loan in the appropriate time, what can likely happen in the future? There are two correct choices.

• It will be harder to get credit in the future

• You will have to lend money instead of borrowing money.

• You will have to pay higher taxes to the government

• You may have to pay more interest.

What are the advantages of credit/credit cards? Check all that apply. There are three correct answers.

• Convenient want to have something sooner than later

• Useful in emergencies

• You can establish good credit for the future

• High interest rates

• High annual fees

What is interest?

• The extra money paid when something is bought

• The income from working a job

• The extra taxes paid when working longer hours

• The extra money that is paid when money is borrowed.