💳 Part 1: Understanding Credit and Debt

1. What is a credit card?

A card that uses your own money from your bank account

A payment card that lets you borrow money up to a limit to pay later

A card that gives you free money

A card only for emergencies

2. What is debt?

3. Which of these are potential risks of credit cards? (Check all that apply)

High interest charges if you don't pay on time

Spending more than you can afford

Building debt that grows over time

Convenient for online shopping

4. If you have a $500 credit card debt with 18% annual interest and only pay the minimum each month, what will likely happen?

The debt will be paid off quickly

The debt will stay the same

The debt will grow larger due to interest charges

The interest will disappear

💰 Part 2: Smart Spending Scenarios

5. Sarah earns $400 per month from her part-time job. Her monthly expenses are: rent $150, food $100, transport $50, phone $30. She wants to buy a $200 jacket. What should she do?

Buy it immediately with her credit card

Save for 3-4 months to buy it with cash

Borrow money from friends

Skip paying her rent to buy the jacket

6. List three strategies to avoid problematic debt:

a) _________________________________________________

b) _________________________________________________

c) _________________________________________________

7. Jake has a $1,000 credit card limit. He currently owes $800. What percentage of his credit limit is he using?

Answer: _______%

8. Explain why it's important to pay more than the minimum payment on a credit card:

🎯 Part 3: Personal Reflection

9. Imagine you're 18 and offered your first credit card. What three questions would you ask before accepting it?

1. _______________________________________________

2. _______________________________________________

3. _______________________________________________

10. Describe one situation where using a credit card might be helpful, and one where it could be harmful:

Helpful situation:

Harmful situation:

11. What is one personal strategy you could use to manage money better in the future?

Credit Cards and Debt

Credit Cards and Debt

💳 Part 1: Understanding Credit and Debt

💰 Part 2: Smart Spending Scenarios

🎯 Part 3: Personal Reflection

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