Credit and Credit Score Worksheet

What is credit?

• A: Money you earn from a job

• B: A loan you give to someone else

• C: The ability to borrow money or access goods or services with the understanding that you'll pay later

• D: A type of bank account

Why is it important to care about your credit?

• It determines your job opportunities

• It affects your ability to borrow money and the interest rates you receive

• It influences your social status

• It impacts your physical health

What is the principal in a loan?

• The total amount of interest paid

• The original sum of money borrowed or invested

• The monthly payment amount

• The total amount of fees charged

What is interest in the context of credit?

• The amount of money you borrow

• The fee charged for borrowing money, usually a percentage of the principal

• The total amount of your loan

• The length of time you have to repay the loan

Which of the following is NOT a reason why credit is useful?

• It allows you to make large purchases and pay over time

• It helps you build a credit history

• It guarantees you will never have financial problems

• It can provide emergency funds when needed

What is a credit score?

• A measure of your income level

• A numerical representation of your creditworthiness

• A record of your employment history

• A summary of your monthly expenses

Which factor has the highest impact on your credit score?

• Length of credit history

• Payment history

• Types of credit used

• New credit inquiries

What percentage of your credit score is determined by your payment history?

• 10%

• 15%

• 30%

• 35%

What is considered a "Good" credit score range?

• 300-579

• 580-669

• 670-739

• 740-799

Why does your credit score matter?

• It affects your ability to get loans and the interest rates you pay

• It determines your annual income

• It influences your physical health

• It impacts your social status