CREDIT
What is credit?
Borrowed money that must be repaid
What is the main purpose of a bank?
To store money and provide financial services
What is a budget?
A plan for managing income and expenses
What is a loan?
Money borrowed that must be repaid with interest
What is a credit limit?
The maximum amount you can borrow on credit
Which factor most affects your credit score?
Payment history
What is a checking account typically used for?
Daily transactions like paying bills
What is income?
Money earned
What is the principal of a loan?
The total amount borrowed
Which is a good financial habit?
Saving regularly
A higher credit score generally means
You are more trustworthy to lenders
What is a savings account?
An account that earns interest over time
Which is an example of a fixed expense?
Rent
What is interest on a loan?
The cost of borrowing money
What is APR (Annual Percentage Rate)?
Yearly cost of borrowing, including interest and fees
Which of the following can hurt your credit score?
Paying on time
Keeping balances low
Missing payments
Checking your own credit
Missing Payments
What is interest?
Money earned or paid for using money
Which is a variable expense?
utility bills
Which type of loan is used to buy a house?
mortgage
Which financial institution typically offers loans and savings accounts?
banks
What is a credit report?
A summary of your borrowing and repayment history
What does FDIC insurance protect?
Bank deposits up to a certain limit
Why is budgeting important?
Helps control spending and save money
What happens if you default on a loan?
You fail to repay as agreed
What is collateral?
Property used to secure a loan