Credit allows you to purchase goods and services you otherwise couldn’t pay for upfront. Using credit comes with a cost, which is the interest charged on the borrowed amount.
Watch the video to find essential answers to the question, “What Is Credit?” Then test your knowledge at the end of the lesson.
What is an example of secured credit?
A. Retail credit card
B. Consolidation loan
C. Auto loan
D. Coverdell ESA
In order to make the best use of open-end credit, you should:
A. Use it frequently to gain rewards
B. Use it to support a financial strategy
C. Use it to cover emergencies
D. Use it for everyday purchases
Which type of card is a great option for someone who is new to using credit?
A. Prepaid credit card
B. Charge card
C. Retail credit card
D. General-purpose credit card