62
QuizMultiple Choice

Cumulative Exam — Cumulative exam

Question 62 • FL-2102371-Personal Finance and Money Management

How can you keep credit utilization low and still have the convenience of a credit card as you work to repair your credit score after bankruptcy?

Answer
A
Increase credit limits on your cards to have more money to spend.
B
Cancel and shred paid-off cards to avoid the temptation of using them.
C
Apply for a personal loan to pay down the balances of maxed-out cards.
D
Apply for a secure credit card with a cash deposit made to that account.

Explanation

A secured credit card requires a cash deposit that serves as collateral, while still letting you make purchases with a card. Keeping the balance low relative to the card’s credit limit helps maintain low credit utilization as you rebuild credit. Increasing limits or taking a loan may encourage more debt, and canceling paid-off cards can reduce your available credit.

AI-written and checked against the verified answer.

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