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Financial Fitness for Life Grades 9-12 Lesson 13: Credit Reports and Credit Scores

Financial Fitness for Life Grades 9-12 Lesson 13: Credit Reports and Credit Scores.

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Financial Fitness for Life Grades 9-12 Lesson 13: Credit Reports and Credit Scores

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  1. Financial Fitness for LifeGrades 9-12 Lesson 13: Credit Reports and Credit Scores

  2. Credit - The opportunity to borrow money or to receive goods or services in return for a promise to pay later.Credit score -A single number assigned to a person used by lenders to predict the risk that borrowers will not repay.

  3. Your Credit ScoreLow 300High 850

  4. Information used to calculate acredit score • • 35% Payment history• 30% Managing your debt• 15% Length of credit history• 10% Diversity of accounts• 10% Number of credit applications

  5. Group Discussion Questions a. What was your credit score? b. What was your interest rate? c. How are your interest rate differences related to your credit score differences? d. How did these differences impact the total cost of the car for individuals in your group? e. What behaviors caused some students to have lower credit scores? f. What behaviors caused some students to have higher credit scores? g. What could individuals with low simulated credit scores do to improve these credit scores? h. Now think about the categories used to calculate an actual credit score. What kinds of behaviors would result in a low score, representing a high risk? i. What kinds of things can each individual do in the future to ensure that your real credit score is high?

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