Credit risks vs. benefits

All of these people have credit, but some have borrowed more than they can comfortably repay.

Read these thoughts of regular people — some may be experiencing problems with credit, while others are on the right track.

Unhappy, stressed woman“When I got my first credit card, it was too easy to spend. I started overdoing it, spending a lot more than I would have spent in cash. Now it’s a real struggle to pay it back. I had to pay a few things late, so now I’m losing money on late fees, too.”

Concerned, stressed woman“I didn’t make some loan payments and that really hurt my credit record. I missed out on an apartment and even got turned down for a job because of it!”

Worried, stressed man“I really messed up my credit. Because my credit rating is low, it’s going to be tougher for me to get loans or credit the next time. If I’m even able to borrow I’ll have to pay a higher interest rate.”

Happy woman“Having good credit made it easier for me to rent an apartment and to get service from local utility companies when I moved in. Good credit also gives me the option of buying things now (like my sound system and cell phone) and paying the money back over time, rather than having to wait.”

Happy man“With good credit, it’s easier for me to buy what I want, when I want it. I have the financial flexibility to make major purchases that take more money than I have on hand. I just bought a great car!”

Man smiling“Good credit is giving me the chance to act on life opportunities. I’m borrowing now to go to college.”

Woman smiling“I don’t want debt problems, so I follow two guidelines: I never let my credit card debt exceed 20% of my yearly net income. Plus, I keep my credit card debt low enough so that my required payments are no more than 10% of my monthly income.”

Note: Borrowing too much money and being unable to pay it back is a huge problem in the United States.

Click the Next button to compare good credit and bad.