How much you owe and how much you can borrow.
Many people need to borrow money at some point in their life. It may be to purchase a car, pay for college, or to buy a house. Using a credit card is a way to acquire something before payment with the promise to pay it in the future.
In July 2021, the Federal Reserve released data that showed Americans’ outstanding revolving debt reached $998.4 Billion, mostly in credit card debt.
Credit is valuable when used correctly, but if misused, it can cause high levels of debt, which can be difficult and take time to pay off.
Understanding what credit is, what it affects, and how to use it effectively is important. Learning about credit increases your likelihood of becoming more financially stable. A good credit score can also increase your chances of getting future loans with lower interest rates.