Credit and You – You are in “Charge!”

Financing a purchase is a commitment of your future income, and not something to be taken lightly. Sure, you get that item or service now, but it's going to take you some time to pay it off. What about the opportunity cost that you won't have that money in the future. Perhaps you might have the chance to open a business, or go to school, or something else that might have a huge impact on the rest of your life. If you don't have the money to pursue it because you're paying off debts from years ago, that can lead to lots of regrets.

If you do decide to buy on credit, you need to decide which method of financing is best for that purchase. Should you get a loan? Secured or unsecured? Should you use your credit card? Using the PACED decision model, you can evaluate the types, sources, and costs of credit in order to make a decision that best suits your needs and results in the lowest finance costs.

Now let's look at how you qualify for credit. What is a credit score? How does a lender decide if they will extend credit to you? What do you need to do to build and maintain good credit? Why is it important? You will learn all of this and more as you continue “taking charge” of your credit!