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Laabri

4.1 Basics of Managing Credit (Due 11/29/22)

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Last updated over 1 year ago
11 Nsɛmmisa

In this lesson, you will learn to:

  • Explain how to make good choices regarding the use and management of credit and debt

  • Understand how credit is typically used in the US

  • Calculate net worth

  • State the difference between a credit report and score and why each is important

Prepare to Make Borrowing Decisions

Once you have a credit card, you need to decide when and how to use it. Watch this video and answer the questions.

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Discussion Prompts

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1.

What are some “good” reasons for using your credit card to make a purchase?

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2.

What are some examples of “bad” reasons to use credit?

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3.

What 4 questions should you ask yourself before using credit to make a purchase?

1.

2.

3.

4.

How to Build Good Credit in College

The previous video discussed a benefit of building good credit while you’re young. Many people get their first credit card when they’re in college, but they don’t know how to manage it well.

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4.

Skim through this article and write down the top 3 things you think are most important for a college student to do to build credit responsibly while they’re in school.

1.

2.

3.

Difference Between a Credit Report and Score

With so many Americans using credit (and with some of them late on their payments!), it’s important to understand the difference between a credit report and score. Watch and answer the questions.

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5.

What 3 types of information would be included on a credit report?

1.

2.

3.

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6.

What is a credit score?

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7.

What role do the 3 credit bureaus play in your credit history and score?

Benefits of Having Good Credit

Now that you know a bit more about managing your credit wisely, why is it so important? Go online and research the benefits of having good credit.

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8.

According to your research, what are 4 benefits of having good credit?

1.

2.

3.

4.

Exit Ticket

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9.

What is the name given to the numerical rating that you receive based on your credit habits?

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10.

If Toni is trying to calculate her net worth, which of the following items would go on the liabilities list?

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11.

Each of the following plays a key role in determining your credit score EXCEPT: