What Is Credit?

What Is Credit?

What Is Credit?
Reading Level

	edHelper's suggested reading level:	high interest, readability grades 5 to 7
	Flesch-Kincaid grade level:	3.41

Vocabulary

	challenging words:		yearly, rates, retail, minimum, agreement, credit, gasoline, electronic, cases, banks, rate, listed, unpaid, convenient, issue, such
	content words:		American Express

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What Is Credit?
By Patti Hutchison

¹     What is credit? Credit is a way of buying something when you don't have the money for it. Many people buy houses and cars with credit. Some people even buy everyday items such as soap and toothpaste with it. Credit can make your life easier. It can also make your life very hard. The key is to understand credit and use it wisely.

²     There are three basic kinds of credit. The first is called retail credit. Many large stores offer their own credit cards. You can only use them to buy things in the store that issues the card. Gasoline companies also issue this kind of credit card. A retail card is the easiest kind of credit card to get.

³     You can use your credit card instead of cash when you want to buy something. You simply hand your card to the cashier or swipe it through a machine. In most cases, you will have to sign a receipt. Or you may have to give an electronic signature on the credit card machine. Simple, right?

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