Business and Personal Finance Chapter 18 Section 2 Review Answers

The toll of college should never discourage anyone from going after a valuable degree. –Arne Duncan, former The states Secretary of Education

LEARNING OBJECTIVES

By the end of this section, you will be able to:

• Plant fiscal goals
• Identify strategies for creating and maintaining a upkeep
• Draw available options for paying for college
• Draw the benefits and risks of credit
• Develop financial literacy skills to prepare for your fiscal future

What is a chapter on personal finances doing in a book on pupil success? If you're a new college student you may non notwithstanding accept coin problems or issues—only near college students soon do. It doesn't matter whether you're a "traditional" college student enrolled in higher just after high schoolhouse or a "nontraditional" student returning to school. If you are living away from abode for the first time, y'all may have less feel setting and sticking to a budget and handling money in general. If you lot have been working and/or have started a family, yous will probable confront the challenges of new expenses and additional demands on your fourth dimension.

Nearly anybody eventually has money issues at college, and they tin can impact your academic success. Money problems are stressful and tin keep you from concentrating on your studies. Unfortunately, money problems crusade many students to drop out of college entirely. Only it doesn't have to exist this hard. Like other skills, financial skills can be learned, and they have lifelong value.

Fiscal Goals

Whatever it is y'all program to do in your time to come, whether piece of work or other activities, your financial goals in the present should be realistic to enable y'all to fulfill your plan. Consider these scenarios:

Keri entered college planning to major in concern. Her family was not able to requite her much financial support, but she chose to attend an expensive private college because she thought it would help her get into a good graduate business schoolhouse. She had to accept large loans to pay her tuition, simply she wasn't concerned virtually a upkeep because she assumed she'd make a lot subsequently on and be able to easily pay off the loans. Withal when she graduated and had to brainstorm making payments on her private bank loans, she discovered she couldn't afford to become straight to business school after all. She put her dream on hold for a few years and took a job she didn't much like.

Jorge had worked a few years after high school merely finally decided that he needed a college degree to get the kind of job he wanted. He was happy with his life otherwise and kept his nice apartment and car and enrolled in a couple of nighttime classes while standing to work full time during the mean solar day. He was surprised how much he had to study, withal, and after a couple months he felt he was struggling. He just didn't accept plenty fourth dimension to do information technology all—so he dropped first one class and so, a couple weeks afterwards, the other. He told himself that he'd effort it again in a year or two, but part of him wondered how anyone could ever get through higher while working.

What Keri and Jorge have in common is a conflict betwixt their financial goals and realities. Both were motivated to succeed in college, and both had a vision for their future. Merely both were unsuccessful in finding ways to make their dreams come truthful—considering of money issues.

Could they have done things differently? Maybe Keri could have gone to a less expensive school and still reached her goal, or perchance she could have avoided such heavy student loans past working summers and part time during the school year. Peradventure Jorge could have reduced his living expenses and cut back his work hours to ensure he could balance schoolhouse and work amend. Maybe both were spending thousands of dollars a year on things they could have done without if only they'd thought through their goals and learned to live inside a upkeep.

Taking control of your personal finances begins with thinking nigh your goals and deciding what really matters to you. Here are some things to think about:

• Is information technology important for you to graduate from college without debt? Is information technology adequate to you lot, or necessary, to take some student loans?
• What are your priorities for summers and other "complimentary time"? Working to earn coin? Taking nonpaying internships or volunteering to proceeds experience in your field? Enjoying social activities and fourth dimension with friends?
• How important is it to have a full load of classes and then that your college instruction does not have longer than necessary?
• How of import is it to you to live in a squeamish identify, or drive a dainty machine, or wear nice clothes, or consume in dainty restaurants? How of import in comparison to your educational goals?

There are no easy answers to such questions. Since you will have to make choices, information technology's important commencement to think about what really matters to you—and what you're willing to sacrifice for a while in order to reach your goals.

The post-obit strategies tin can aid yous set financial goals for yourself:

• Create SMART goals: SMART stands for specific, measurable, attainable, realistic, and timely. These kinds of goals are more manageable and can assist yous reach your final target more than hands. For example, instead of setting a broad, vague goal of "paying for college," you might set a goal of paying off your ii college loans five years subsequently you graduate. This more specific, measurable goal can help you go along track of your progress and whether you need to make changes to accomplish it.
• Monitor your spending: Try keeping runway of what you spend money on during a i-month menstruum. This tin can help you see where your money goes and where you lot may be able to save.
• Create a budget: Based on what you discovered after monitoring your spending, create a monthly upkeep you lot can stick to. While some expenses, such as food and transportation, are necessary, you may find that you lot can save money on both past riding a bike (instead of driving) to school and eating out in restaurants less.
• Consider working: Some students take full-time jobs while attending college, whereas others may non have a lot of fourth dimension to work if they're taking a full bookish load. You will find information later in this affiliate on how to decide if working while in schoolhouse is right for you.
• Cull loans wisely: Many college students demand some sort of financial support through loans. While loans are a practiced way to pay for tuition up front if you don't take the money, remember that they accrue involvement until you lot pay them off. That means that you will finish up paying dorsum more than—in some cases, thousands of dollars more—than y'all initially borrowed. Make sure you lot investigate and apply for as many scholarships and grants as y'all can since they won't demand to exist repaid, and shop around for the loans with the lowest interest rates and best repayment plans. Check with the financial aid office on your higher campus—they can provide additional help.

Budgeting

A upkeep is but the best fashion to rest the money that comes in with the coin that goes out. In this section, we volition review common expenses and sources of income for college students and discuss means to balance these in a upkeep that works for you.

Expenses

There are sure fiscal obligations near higher students have to pay for. Common examples include:

• Tuition: This includes the price for attention an institution. Students pay relatively more or less for this based on where you are going to schoolhouse and how many credits you are taking.
• Room and board: These are essentially "food and shelter" costs. Many college students alive in a dorm and consume their meals on campus. Students who alive off campus will have to pay for comparable things, like renting an apartment and buying their own groceries.
• Books and supplies: These include books for classes and supplies like notebooks, writing utensils, and calculators. Textbooks are often very expensive, and so you may try to find used textbooks for sale.
• Transportation: Students typically have some transportation costs, whether it be car insurance, maintenance, and gas, or public-transportation expenses.
• Personal needs: Regardless of where you live, you will need coin for things like laundry, cell phone, reckoner, and going out with friends. This expense can vary a lot depending on personal preferences.

Needs Vs. Wants

Before yous tin can make an effective budget, y'all examine your expenses and consider what's essential and what's optional. Essential costs are the big things y'all demand to get by:

• Room and lath or rent/mortgage, utilities, and groceries
• College tuition, fees, textbooks, supplies
• Transportation
• Insurance (health insurance, car insurance, etc.)
• Dependent intendance if needed
• Essential personal items (some habiliment, hygiene items, etc.)

In dissimilarity, "optional" expenses are things y'all wantbut could easily go by without. Y'all don't have to spend money on them, and you lot tin can spend more or less on them as you lot choose. About people spend past addiction, non really thinking about where their money goes or how speedily their spending adds upwards. If you knew you were spending more than than a 1000 dollars a year on coffee you purchase every day between classes, would that make you retrieve twice? Or another thousand on fast food lunches rather than taking a couple minutes in the morning to make your tiffin? When people really offset paying attention to where their money goes, most are shocked to see how the totals grow. If you can save a few yard dollars a twelvemonth by cutting back on just the little things, how far would that become to making you feel much ameliorate well-nigh your finances?

The Cost of Higher

Given what you have read and so far, what types of expenses practice you think you might face as a college student? The following video will help yous review the types of college expenses and examine item costs that are common for both 4-year and two-year institutions.

Sources of Income

Paying for college can be a big challenge. When deciding how to cover the expense, two important source of income include:

• Jobs: Many educatee work while taking classes to cover their expenses.
• Financial Aid: This can come in the form of loans, grants, work written report, or scholarships.

Both options can help you finance your education, only both also come with both benefits and potential pitfalls. The next sections await at each of these options in more detail and will help you determine the what strategies will be best for you.

Working During College: Pros and Cons

Finding a job equally a college student tin can help you stay on rails financially, just it can also be difficult to balance with your other responsibilities, and information technology's non for anybody. Here are some of the advantages and disadvantages of working during college:

Pros

• Earning extra coin: The money you lot earn can assist embrace college expenses.
• Enhanced budgeting skills: If y'all are working, you may learn to budget your coin amend since you have to earn it yourself.
• Enhanced fourth dimension-management skills: Juggling classes, work, and perhaps other activities such as clubs or sports, may actually aid you excel in your classes because you learn how to finer manage your time.
• Networking: In addition to work feel in a field related to your interests, you may also come across people who can aid you afterward when you're set up for a career.

Cons

• Lack of time-direction skills: Though working during higher tin help build time-management skills, you may struggle if you aren't used to balancing activities. For example, a student who heads to college straight from loftier school without whatsoever prior job experience (or with few extracurricular activities during high school) may have problem meeting multiple academic and job obligations and commitments.
• Lack of free time: If you lot accept on a lot of work hours while in college, your may not take fourth dimension for other activities or opportunities, such equally joining clubs related to your interests or finding volunteer work or internships that might aid yous discover career opportunities and connections. These "extras" are actually meaning résumé items that can make you more employable after college.

Deciding whether or not to work while you're in college is manifestly a personal decision that involves your own comfort level and situation. Some students may prefer to put off looking for a chore until afterward the start semester of higher, and so they tin can meliorate guess their work load and schedule, while others may prefer to avert working altogether. For some, the question isn't "Should I or shouldn't I go a job?" simply "How much should I work?" In other words, the challenge is to strike the right residue between schoolwork, social activities, and earning money.

The following video shares ane student'due south feel with the pros and cons of working her way through higher.

Fiscal Assist

You may already be receiving fiscal aid or empathize what types of financial assistance are available. Even if you are non receiving financial aid, however, you should understand the basics considering your financial situation may change and you may need aid paying for higher. You owe it to yourself to acquire nearly potential types of aid y'all might receive.

In that location are 3 primary categories of financial assist:

1. Scholarships and grants (coin or tuition waivers that practise not need to be repaid)
2. Student loans (money that does demand to be repaid, commonly starting later graduation)
3. Work study programs (money that is earned for tuition or other expenses)

Scholarships and Grants

Scholarships and grants are "complimentary" money—you do non have to pay them back, different pupil loans. A scholarship is generally based on merit as demonstrated past past grades, test scores, achievements, or experiences, including personal qualifications such as athletic ability, skills in the arts, community or volunteer experiences, and so on. Don't make the mistake of thinking scholarships go only to students with loftier grades. Many scholarships, for example, honor those with by leadership or community experience or the promise of time to come activities. Even the grades and examination scores needed for academic scholarships are relative: a grade point boilerplate (GPA) that does non qualify for a scholarship from one organization may earn a scholarship from another. Never presume that you lot're not qualified for any kind of scholarship or grant.

A grant also does not demand to be paid dorsum. Most grants are based on demonstrated fiscal need. A grant may be offered by the college, a federal or state programme, or a individual system or civic group. The largest grant program for college students is the federal government's Pell Grants program. Acquire more about Pell Grants and other scholarship and grant programs from your higher's financial assistance role or the online resources listed later.

Student Loans

Many different student loan programs are bachelor for college students. Ideally, one would like to graduate without having loan balances to repay after higher. However, well-nigh two-thirds of total-fourth dimension college students practice need student loans to pay for college. With smart choices about the type of loan and a structured repayment plan for your working years after graduation, in that location'due south no reason to fear a loan. Just remember that the money eventually has to be repaid—information technology'south not "free" money even though it may feel that style while you're in school.

All student loans are non the aforementioned. Interest terms vary widely, and with most private loans the interest starts edifice up immediately. The best loan generally is a subsidized federal Stafford loan. "Subsidized" in this instance means the interest does not begin on the loan until later on graduation. With unsubsidized loans, by dissimilarity, y'all are responsible for paying interest on the loan even while yous are in school, meaning the terms of an unsubsidized loan are less favorable to you as a student. Check the U.S. Section of Education site for data on applying for different types of loans.

Many colleges and universities accept also created additional programs – such as textbook or childcare assistance or an emergency fund – to support their students facing financial need. Cheque with your school's financial aid office to find out if you lot authorize for any additional assistance.

Work Study Programs

Work written report programs are the 3rd type of financial aid. They are administered by colleges and are a mutual part of the financial assistance bundle for students with financial need. You lot piece of work for what you earn, but work study programs ofttimes have advantages over outside jobs. The college runs the program, so y'all don't accept to spend valuable time looking for a chore. Piece of work study students usually work on or near campus, and work hours are controlled to avoid interfering with classes and study time. Work written report students are more engaged with the academic customs than students working off campus. Remember the section above that discussed working while in college and be sure to advisedly weigh the pros and cons before deciding well-nigh a work report plan.

As the post-obit video shows, regardless of your background, which college you're attention, or your fourth dimension commitment, at that place are numerous financial assist opportunities for you to consider:

Tips for Success: Applying for Financial Help

• Talk to your college's financial aid role early and get the appropriate forms.
• Offset your applications early to ensure you brand the deadline. If you are eligible, be certain to submit the Free Application for Financial Student Aid (FAFSA) to see if you qualify for federal educatee assistance.
• Do online research to learn most additional private scholarships you may be qualified for.
• Evaluate student loans carefully and do not borrow more than than you need or can repay without hardship after graduation.

Budgeting Strategies

At present that nosotros accept looked at common college expenses and forms of income, it is fourth dimension to talk about budgeting. Without a personal upkeep, almost people have a hard time gauging how much money they spend and where their money goes. If you have ever gone to an ATM to withdraw money and been surprised to observe how niggling yous had left in your account, this section is for you. Even if you're very conscientious about paying your bills on time and generally have frugal spending habits, creating and following a budget can put so much further ahead.

In essence, a budget is a plan for how you want to spend money. It details how much coin comes in each month and how much you've allocated for spending on each thing. The virtue of a budget is that information technology puts you in control of financial decisions—and then y'all tin avoid surprises at the ATM or at the end of the calendar month. Allow's look at some strategies for creating a budget:

• Be realistic: People are often intimidated by budgets because they're afraid the plans will be as well strict or force them to cut back too much. Though a upkeep may reveal that yous indeed spend a lot of money on clothes, that's okay—it may but too need to bear witness that you spend very fiddling on restaurants and eating out to make up for it. Again, it's about making choices and being realistic.
• Choose a fourth dimension line: Creating a budget for a fixed menstruum of fourth dimension will help y'all monitor whether you lot're meeting your financial goals. The time line you choose is up to you and your goals. For example, you might create a monthly budget to monitor how you spend your paycheck every month.
• Add together financial padding: Fifty-fifty if you experience like your listing of financial obligations is already long, endeavour to set aside a certain amount each calendar month for a "rainy mean solar day" fund to pay for unforeseen expenses and emergencies, like car repair, lost textbooks, etc.
• Make adjustments as needed: While sticking to your budget is important, at that place's null incorrect with revisiting and adjusting your original targets. For example, if you detect that y'all are really spending $l more per calendar month on groceries than you intended (even afterwards shopping for sale items), you may decide to salve that money elsewhere in your budget side by side month—on entertainment, for example.

Tracking one's income and spending is a proficient do for anyone, and if y'all follow the basic steps, below, it'southward easier than you might call back:

• Calculate regular expenses: Using your bills, receipts, checkbook, and any other financial records you take, make a list of your regular expenses and record how much you typically pay each calendar month or twelvemonth. Since some expenses like grocery bills may vary from calendar month to month, yous'll want to examine several months' worth of receipts to come up upwards with an average.
• Record your income: Identify all income sources and add up how much you lot receive during a given flow of fourth dimension. This corporeality should include all sources of money—from regular full- or office-time work and from intermittent sources, such as freelance jobs, babysitting, etc.
• Adjust your expense percentages, and set up goals: Subsequently you outline your fiscal obligations and income, you lot tin can starting time deciding how much money you'd like to allocate for each expense. Start with stock-still expenses such as rent, car payments, etc. Adjacent, decide how much you want to devote to each of the remaining categories, such every bit nutrient and entertainment. At this indicate yous can also set specific fiscal goals. For example, you may decide to lower the corporeality you spend on clothes in order to pay off outstanding credit-bill of fare debt or salvage for a trip.
• Identify a method for tracking your budget: Develop a plan for monitoring your budget. Yous might decide to use an Excel or Google spreadsheet, a budgeting app, or a budget tracking tool provided by your banking company. You lot tin can also write things downwards in a notebook. The method doesn't matter, so long as information technology's piece of cake for you to access, employ, and interpret.

All the same not convinced that making and post-obit a upkeep is achievable? The following video describes a budgeting technique that'south very piece of cake and straightforward to follow: the "Envelope Budget." Simply placing greenbacks in labeled envelopes (1 for each category or purpose) each calendar month tin be a very effective means of building healthy spending habits.

ACTIVITY: Fiscal WELLNESS

Objectives

• Identify strategies for creating and maintaining a budget

Directions:

• Identify 2 larger higher expenses and two smaller higher expenses that you are responsible for. For example, tuition might exist a large higher expense while notebooks and folders might be smaller ones.
• Draw any sources of income you lot currently have to cover these expenses.
• Explain 3 financial goals you take for covering your college expenses. For example, you lot might want to consider work report or taking out another loan.
• Follow your teacher's guidelines for submitting assignments.

Credit

For many college students, who may non have a lot of money or a chore, owning a credit carte du jour may seem out of reach. Without money in an business relationship and assurance that you can pay your monthly credit pecker, the average student may not seem very "credit-worthy." Even so, it tin exist important to build a credit history for certain opportunities downwardly the route, such as getting a loan to buy a house. You may be surprised to learn that at that place are enough of companies that offering special options for younger customers, peculiarly students. Some skilful offers to expect for include mistake forgiveness (such equally waiving penalties the beginning time you lot miss a payment), no actress fees, rewards for practiced grades, and constructive customer service.^[1]

Risks and Rewards of Credit

Credit cards can give students new opportunities, but owning them is too a big responsibility. Students should consider the advantages and disadvantages of credit earlier choosing the all-time plan.

Pros

• Saving money: Credit cards tin exist connected to checking accounts so that companies know where their customers' coin is coming from and they have an account to charge interest rates to. The business relationship can assistance you practice saving coin rather than needing to take a lot of cash on mitt. This can make information technology easier for you to make big payments for things like tuition and unexpected expenses similar vehicle maintenance or medical bills.
• Receiving benefits: In addition to cash dorsum for skilful grades, credit card companies may offer other benefits such equally store discounts, gas rewards, and points toward air travel.
• Building credit: If you pay off your credit card every calendar month on time, yous will commencement building credit and take a good credit score early on. Your credit score can be an important factor later on on if you decide to open another account or take out a loan. Some potential employers may fifty-fifty want to meet your credit history.

Cons

• Overspending: If something is out of sight, it may be out of mind, and the same can be true of money. Sometimes people overspend with credit cards because information technology'southward easy to think that you have more money than y'all really do.
• Interest: Credit carte du jour companies with student deals yet typically include some level of APR or interest rate. If you don't pay off the entire residuum every month, using a credit card can be expensive. Suppose you determine to use your credit card to pay for $1,000 in school supplies and books. Credit card A has an Apr of x percent, and credit card B has an Apr of 24 per centum. If it takes you lot a year to pay off the $1,000, you'd actually pay a total of $1,055.04 with credit card A and $1,134.72 with credit card B—that's $55 or $135 on pinnacle of the original $1,000 you charged! This example highlights the importance of paying off the balance as soon as possible AND of choosing a credit card with a lower interest rate.
• Debt: Unlike debit cards, credit cards allow users to borrow money that they tin can pay back at a later engagement. While this tin can exist useful in emergency situations, you may end up charging more than you tin beget to pay back correct way, and you may find yourself saddled with debt. Conveying a lot of debt can harm your credit history and score.

Avoiding Debt

As we just learned, the temptation to overspend with a credit card and the interest you are charged on your balance can combine to exit y'all owing more than money than you have. Following are tips that will assistance you avoid slipping into credit card debt:

• Pay with cash when yous can. Use your upkeep equally a guide for how much greenbacks to conduct with yous – refer back to the video in this affiliate on the envelope budget strategy.
• When possible, use a debit card instead of a credit card. A debit card is taken simply like a credit card in most places, so you can use it instead of cash, but remember that a buy is subtracted immediately from your account. Don't risk overdraft fees by using a debit carte du jour when you lot don't have the balance to back information technology up. Record a debit card purchase in your checkbook register equally shortly equally possible.
• Make it a priority to pay your balance in total every month. If you can't pay it all, pay equally much equally you can—and and then remember that rest will still be at that place, so endeavour non to use the card at all during the next calendar month.
• Don't go cash advances on your credit bill of fare. With most cards, you brainstorm paying interest from that moment forrard—so in that location volition still be an involvement charge even if y'all pay the bill in total at the end of the month. Cash advance involvement rates are often considerably higher than buy rates.
• Don't use more than than ane credit card. Multiple cards get in as well easy to misuse them and lose track of your full debt.
• Get and keep receipts for all credit card purchases. Don't throw them away because you lot'll see the charges on your monthly argument. Write the amounts downwardly in your spending upkeep. You lot too need the receipts in case your monthly statement has an error.
• Finish carrying your credit bill of fare. If you don't have enough willpower to avoid spontaneous purchases, be honest with yourself. Don't comport the menu at all—after all, the chances of having an emergency demand for it are likely to be very small. Having to go home to go the carte du jour also gives yous a chance to consider whether you really need whatever it is that you were about to buy.

Credit History and Credit Reports

You begin to establish a credit history as soon as you go your first credit menu or become a loan. Everyone needs to empathise what a credit history is and how your monetary habits now tin can affect your future fiscal well-being and your future options.

Credit bureaus collect financial data on everyone. The credit study they issue is a detailed history of many years of your fiscal habits. It includes the following:

• Current and past credit accounts (credit cards and store charge cards)
• History of balances and credit payments
• History of tardily or missed payments
• Inquiries into your credit condition (eastward.g., if you lot've practical for a number of credit cards, this is recorded fifty-fifty if you did non receive the cards)
• Bankruptcy or mortgage foreclosure proceedings

All this data remains in your credit report for upwards to seven to x years. For example, frequent overdrafts on a debit card can forbid you from being approved for a credit menu, or tardily credit card payments can prevent y'all in the futurity from obtaining a car loan. What yous do today can really come back to haunt yous!

By law, you're entitled to one gratuitous credit report each twelvemonth from Annual Credit Report. Although yous have to pay extra for your credit score to be included with your credit report, a lot of people use this equally a quick reference to gauge how good or bad someone's credit is. Dissimilar companies use slightly dissimilar ratings, but 300 or so is considered to be a low credit score, and 700–850 is considered to be high. The post-obit video shows how your credit score is determined and some rules of the road for improving your current credit rating.

Resources for Credit Issues

Maintaining credit is a large responsibility, and sometimes it can exist challenging. Repairing bad credit can take a long time—up to seven years—and so it's important to accept action equally presently as yous're having problem paying bills or overspending. Different resource and options are bachelor to help y'all bargain with credit problems, including the following:

• Loan consolidation: Students may consider having multiple loans consolidated with the federal government so they have to brand but 1 loan payment per month. While this may give yous more than time pay off student loan debt, it may non be the best choice, since the one monthly payment can price more and accrue a higher interest charge per unit. Students should talk to loan company representatives and financial aid resources at their establishment to discuss other payment options, such as income-based payments in which the amount you pay each calendar month is based on your income level.
• Credit counselors: Credit counselors are trained to assist people develop personal budgets and to provide classes on savings and debt solutions. They may also offering debt management plans in which they piece of work with your credit carte du jour and loan companies to arrange a deal and ask you for monthly deposits so that they tin can help you lot pay off your debts. If yous are interested in a consultation from a credit counselor, do your inquiry to find a reputable one who does not charge customers besides much for their services to avoid boosted debt.
• Debt settlement plans: Debt drove companies will offering services to their clients that involve talking to credit card and loan companies and coming up with a plan to pay a lump sum instead of the total debt owed. Similar to finding credit counselors, you lot should contact local government offices to find reputable debt collection companies so yous tin can avoid overpayments and scams.
• Bankruptcy: Bankruptcy is an official condition that is obtained through court procedures, and information technology ways you are unable to pay off your debts. Defalcation amercement your credit score, and the fees for filing paperwork and hiring an attorney tin can exist costly, so information technology is important to consider other financial solutions first.

Central TAKEAWAYS

• Now is the time to identify and brainstorm working toward your financial goals.
• Budgeting involves assessing your spending habits to ensure your income volition embrace your expenses.
• Many students work while they are in college; counterbalance the pros and cons to determine if this is the right conclusion for yous and how you can strike the all-time residue between working and taking classes.
• Financial aid – in the grade of scholarships, grants, loans, and/or work study – is available to help yous pay for college.
• Owning a credit carte comes with significant benefits andrisks. While it is good practice to begin establishing your credit history, be conscientious to avoid falling into debt.
• Your credit history is tracked by financial institutions and can be used in future determinations nearly other credit cards, loans, or fifty-fifty in getting a job. Review your credit report regularly to know where you stand up and check for errors.

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Source: https://courses.lumenlearning.com/austincc-learningframeworks/chapter/chapter-18-managing-your-money/

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