Debt Management

Bailey borrowed some money from a bank to buy a car. In this scenario, what is the money Bailey borrowed?

• Money Bailey saved for future expenses

• Money borrowed from a lender that must be repaid

• Money given to Bailey by his friend, Dylan

Beth is considering taking on some debt to buy a new house. Which of the following types of debt would be considered secured?

• The credit card debt Beth incurred from shopping

• The mortgage on Beth's new house

• The medical bills from Beth's recent surgery

Zak has multiple debts with different interest rates. Why is it important for him to prioritise paying the debt with the highest interest rate when creating a repayment plan?

• It helps Zak build a good credit score

• It saves Zak money on interest in the long run

• It's easier for Zak to pay off high-interest debt

Imagine Silver is preparing to assess his financial situation. What should he include in a list of his debts?

• Only the names of the lenders he owes money to

• Outstanding balances and due dates of each debt

• His favourite colours

Maddison has multiple high-interest debts from her credit cards, personal loans, and a car loan she took for her brother Jake. What is a common strategy she could use to manage these debts?

• Making minimum payments on all debts simultaneously

• Ignoring some debts and paying others off quickly

• Debt consolidation to lower interest costs

Dylan has a lot of student loans to pay off. What should he do to avoid accumulating more debt while managing his current ones?

• Dylan should increase his spending on his credit card

• Dylan should stick to his budget and use credit responsibly

• Dylan should pay only the minimum amount due on his loans

Maddison has taken a loan to buy her dream car. Why is it important for Maddison to keep track of her debt repayment progress regularly?

• To brag to her friends Zak and Dylan about her financial status

• To make necessary adjustments to her repayment plan if needed

• To calculate her credit score

After Beth successfully paid off her credit card debt, what would be a smart financial move for her?

• Start using her credit card recklessly and accumulate more debt

• Set and work toward a long term financial goal like buying a house or a new car or expensive holiday

• Spend all her extra income on luxury vacations and high-end gadgets