Credit Newsletter

By: Cameron Becker

The Basics of Credit

  • What is credit?

Credit is the ability to borrow money in return for promise of future payment, also known as "buy later."

  • What are the forms of credit?

Credit can come in many different forms such as credit and debit cards and personal loans.

  • What costs are associated with credit?

When using credit, you will be charged an annual interest or APR fee. The amount that these fees include can depend on a few different factors such as the economy and your creditworthiness. These fees are paid alongside the amount of money that was borrowed by people using credit in order for the banks or lender to make money off of loaning you money.

  • What determines if someone gets credit and how much they get?

Overall, what determines a person's credit is their creditworthiness or your reliability to pay back a loan. Your creditworthiness comes from the credit bureau, which has a record of every adult's credit history and assigns them a credit rating. This is your credit report. Your credit report also contains your credit score, which will provide you with a score between 300 and 850. The higher your credit score, the better!

Vocabulary Watch!


-your reliability to pay back a loan.


- the percentage of a sum of money charged for its use.


- a loan that establishes consumer credit that is granted for personal use; usually unsecured and based on the borrower's integrity and ability to pay.

Credit Cards: What You Need to Know

  • What is a credit card?

- A card that is issued by a bank, business, etc. for the purchase of goods or services on credit.

  • Where can you use credit cards?

- You can use credit cards at a number of different places such as grocery stores, shopping malls, fast food restaurants and many more. Nowadays, pretty much any store accepts the use of credit cards.

  • What are the benefits and costs of using credit cards?

- Many people find credit cards to be a very useful part of their lives. Many of the benefits of using a credit card comes from the idea of "instant gratification," which means that even if you don't necessarily have the money on you for whatever you want to purchase, you can easily pull out your credit card and pay for the things that you want that way. However, there are also costs of using a credit card. Having a credit card means being responsible. First off, credit cards contain annual fees, which means that about every year, you are charged for being able to use your credit card. Along with an annual fee, credit cards also contain an interest (APR) rate, which are fees that are calculated alongside the amount of money that you owe and spend. Also, many credit cards involve a credit limit, which means that you are only allowed to spend a certain amount of money from your credit card. If you go over this set limit, then you will be charged with an over-the limit fee. When owning a credit card, you must also be responsible in paying your credit card bills on time. If you fail to do this, then you will be charged with penalty fees, which will then cost you even more money and pull yourself even deeper into debt. Credit Cards are a very useful thing to have as long as you are responsible with them.

Smart Consumers: Don't Fall Into the Credit Card Trap

The number one thing that smart consumers must remember when using a credit card is to be responsible. Paying your bills on time and watching how you spend are key when having an enjoyable experience with using credit cards. Otherwise, you can end up landing yourself into thousands of dollars in debt. Using a credit card can either be a very rewarding experience or a very discouraging thing, but that is up to you.