Understanding Credit Cards

What is a common misconception about credit cards?

• They automatically improve your credit score

• They are only for the wealthy

• They are essentially free money

• They are only used for online purchases

What is the primary function of a credit card?

• To earn unlimited cashback

• To borrow money from the bank

• To make international transactions free

• To borrow books from the library

What is a secured credit card?

• A card for secured transactions only

• A card secured with a password

• A card that requires collateral

• A card with unlimited credit

Why is it important to pay off your credit card each month?

• To earn rewards points

• To increase the credit limit

• To keep the card active

• To avoid late fees and interest

What is the risk of not understanding how credit cards work?

• Missing out on rewards

• Having too many cards to manage

• Accumulating debt due to interest and fees

• Not being able to use the card internationally

What can a good credit score help you with in the future?

• Traveling for free

• Getting a job

• Buying a car or house with better interest rates

• Winning the lottery

How can bad credit affect your ability to rent an apartment?

• Landlords may ask for a co-signer

• Landlords may deny your application

• Landlords may require a higher deposit

• All of the above

What should you do before applying for your first credit card?

• Consult with a financial advisor

• Discuss with friends and family about their experiences

• Save a large sum of money

• Travel abroad

Why is it important to have conversations about money and credit cards?

• To brag about your credit score

• To find the best shopping deals

• To make informed financial decisions

• To learn about investment opportunities

How do you avoid owing interest on your credit card purchases?

• Pay your card in full each year.

• Pay your card in full each month.

• Make at least the minimum payment each month.

• Don't make more than the maximum payment each month.