FL10.9

Investigate credit options and the importance of responsible borrowing.

Indicators for this outcome
(a) Identify ways for a person to access credit for the first time and build a credit score.
(b) Discuss credit scores and how they can impact future financial activities.
(c) Explain the difference between good debt and bad debt and why individuals need to respect debt.
(d) Differentiate between credit and debt.
(e) Compare various options for purchasing items with payment plans (e.g., Buy Now Pay Later [BNPL], rent to own) and without payment plans (i.e., cash price).
(f)

Compare different types of credit, including installment credit (e.g., car loans, student loans) and revolving credit (e.g., credit cards, lines of credit), focusing on:

  • repayment terms;
  • minimum payment;
  • interest rates; and,
  • impact on credit scores.
(g) Discuss the concept of net worth and its importance when borrowing.
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