TC2--MSU Adulting: Credit Craze – Managing Your Credit Wisely

What is the primary difference between credit and debit?

• Credit uses borrowed money; debit uses your own money

• Debit uses borrowed money; credit uses your own money

• Credit and debit are the same

• Credit is used for online purchases; debit is used for in-store purchases

Which of the following is a benefit of using credit responsibly?

• Accumulating high-interest debt

• Building a positive credit history

• Overspending on unnecessary items

• Ignoring credit card statements

What does a credit report include?

• Your credit score only

• A list of your credit accounts and payment history

• Only your current credit card balances

• Your personal income and employment history

How can you check your credit report for free?

• By contacting your bank

• By visiting annualcreditreport.com

• By calling the credit bureaus directly

• By checking your credit card statement

What is a credit score?

• A number that predicts your credit risk

• A list of your credit accounts

• The amount of debt you owe

• The number of credit cards you have

Which factor has the most significant impact on your credit score?

• Length of credit history

• Types of credit used

• Payment history

• New credit inquiries

What is the recommended credit utilization ratio to maintain a healthy credit score?

• 50%

• 30%

• 70%

• 90%

What is a secured credit card?

• A credit card with no spending limit

• A credit card backed by a deposit you make

• A credit card with high interest rates

• A credit card that doesn't require a credit check

How long can negative information, like late payments, stay on your credit report?

• 1 year

• 3 years

• 5 years

• Up to 7 years

What is one way to establish credit if you're new to credit?

• Apply for multiple credit cards at once

• Become an authorized user on someone else's account

• Ignore credit card offers

• Only use cash for all purchases