Financial Literacy Quiz Questions And Answers

Explanation
> Always keep your social security card in a safe place, never in your wallet.
> Never give your social security number to anyone unless you need to provide the number for a good reason.
> They can use that number to open a credit card account or get a loan using your name. The lender will then expect you to pay for the purchases or repay the money.
> Other examples of identity theft include using another person’s name or social security number to open a bank account or to open a cell phone or utility account.

Explanation
> Beware of misleading e-mails and fraudulent Web sites used to trick you into revealing personal information.
> For example, someone claiming to be your bank may send you an e-mail telling you that you will not be able to use your credit card unless you provide your social security number or your online log-in and password.
> This is called phishing, and is used to obtain personal information for unlawful purposes.

Explanation
> When you apply for a credit card or a loan, the bank or store collects your personal information, such as your address, account balances, payment history, etc.
> Some of this information is made available to other companies, which then use the information to send you solicitations for credit cards and insurance products.
> You can opt out of this sharing by calling (888) 5-OPT-OUT / (888) 567-8688 or online at www.optoutprescreen.com.

Explanation
> When you have a loan or a credit card from a bank or other lender, the lender keeps a record of whether you pay back your loan on time.
> This information is made available, along with information about your other debts, to other lenders or potential lenders.
> Your credit history will affect whether you can get a loan or the interest rate that you will have to pay to get that loan.
> It can also determine if you’re able to rent an apartment or get a job.

Explanation
> Your credit report is available to lenders, employers, landlords, and insurers, as long as they have a “legitimate business need.”
> You can order your credit report, and should do so in order to verify that the information is accurate and to see if anyone else has been using your name or financial information illegally. > Under federal law, you can get a free copy of your credit reports annually. To order free reports, go to www.annualcreditreport.com or call (877) 322-8228

Explanation
> Using a credit card to make purchases offers several advantages over paying with cash.
> For example, most credit cards offer some form of protection if your card is reported stolen or missing, while cash cannot be replaced if lost or stolen.
> Using a credit card may also give you some form of buyer protection if you purchase an item that is defective.
> If you pay by credit card, you will be charged interest on your credit card balance. On most credit cards, you will not pay interest if you always pay off the entire balance - not just the minimum amount due - by the due date.

Explanation
> Different credit card companies have different policies about late payments.
> Whenever you apply for a credit card or answer a credit card solicitation, be sure you understand the credit card terms, such as the interest rate, any annual fee, and any late fees.
> The credit card issuer must provide information to you about additional costs if you default, along with other information.

Explanation
> There have been many scams tricking victims into sending money because they expected to receive a large fortune after an initial deposit or “investment.”
> Names and e-mail addresses are easily available from mass mailing lists.
> If a deal sounds “too good to be true,” it probably is a scam.

Explanation
> It’s not uncommon for people to go through trash looking for credit or financial information or documents containing your social security number.