Financial Literacy Review

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What is a credit score?

Back

A credit score is a numerical representation of a person's creditworthiness, based on their credit history.

Front

True or False: Paying cash for all purchases helps build a positive credit history.

Back

False

Front

What factors are used to calculate a credit score?

Back

Factors include payment history, amount of money owed, length of credit history, and types of credit used.

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What is the difference between debit and credit cards?

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A debit card withdraws money directly from your bank account, while a credit card allows you to borrow money up to a certain limit to make purchases.

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What does it mean to use a credit card?

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Using a credit card means borrowing money to make a purchase, which must be paid back later.

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What is a loan?

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A loan is money that is borrowed and must be paid back with interest.

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What is the purpose of a credit card?

Back

The purpose of a credit card is to allow consumers to make purchases on credit and pay for them later.

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What is a positive credit history?

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A positive credit history shows that a person has consistently paid their debts on time.

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What happens if you miss a payment on your credit card?

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Missing a payment can negatively impact your credit score and may result in late fees.

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What is the term for the total amount of money you owe on your credit card?

Back

Credit utilization.