Credit 101
Credit often feels like a mysterious and treacherous aspect of personal finance when you are young and/or just beginning your money management journey. Despite its reputation, credit is a tool that with responsible use will improve your financial standing. Before you embark on the journey of seeking credit, it is important to know how credit and credit scores work so you don’t accidentally end up in hot financial water.So what is credit? Credit is money you borrow to use for goods and service and that you will repay at an agreed-upon time with any applicable fees and charges (usually interest). There are four types of credit.RevolvingChargeServiceInstallment.Revolving credit is typically associated with credit cards. When you use this type of credit, the lending institution approves you for a maximum amount of…
