- What percentage of families live paycheck to paycheck?
- For most people, what percentage of financial success is based on behavior?
- Approximately what percentage of families will face a major financial emergency within any 10-year period?
- With short term sacrifice, you get:
- What is delayed gratification?
- Why might it not be a good idea to buy a home?
- For which type of transactions must you have a credit history?
- Why should you not go into debt?
- Of the families that have debt, which type of debt is usually the largest?
- Approximately how many credit card offers were made last year?
- What types of techniques do credit card companies use to get you to sign up?
- What are some of the costs of being in debt?
- What’s the best way to get a car?
- Why should you not by a new car with credit?
- List several credit myths:
- Compare and contrast the differences between a 15-year and a 30-year home mortgage:
- Compare and contrast the characteristics of debit and credit cards:
- List and describe the Three C’s of Credit:
- What does a FICO score measure?
- How can you buy a house without a credit score?
- Which type of company gathers data and creates credit reports?
- According to what you learned in class, what must be true for you to use a credit card?
- According to 75% of the 400 richest people in North America, what is the #1 key to building wealth?
- According to what has been discussed in class, when is it ok to borrow money?
- Why should you always pay cash?
- What technique are credit card companies using when they market to 4 and 5 year olds?
- What is the formula to calculate simple interest?
Credit
Credit Worthiness
-ability to pay back
Character
- credit history, work history, payment history, criminal record (credit report created by credit bureau like TransUnion shows your credit score. The higher your credit score the more credit worthy you are and the lower your interest rate will be)
Capital
- how much you own (cash and property) minus how much you owe
Capacity
- Income minus expenses
Collateral
- what they get if you don't pay back (house, car)
Credit Card Topics:
-Credit Limit
-Annual Fees
-Cash Back Bonus
-Annual Percentage Rate (increases if over limit of pay late)
What you should do:
- always pay in full each month and avoid interest (if only pay minimum, balance goes down very slowly)
- look for no annual fee with cash back bonuses (high annual fees can eliminate the benefit of cash back or travel rewards)
- stick to your budget
Debit Cards are not credit.
Final Exam Review Guide
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