This is for financial literacy i need this done ASAP please. Your 27-year old cousin is graduating from college and has already accepted her first full-time job offer. She will be earning 53.000 per month. She already has an apartment and her fixed monthly expenses are $1500 per month. She enjoys traveling, but doesn't have a lot of money to do so. She also has $500 per month in student loan payments. She needs a car to get to work, but knows that she has to finance it through an auto loan. She also wants to begin building her credit history by applying for a credit card; she has been an authorized user on her parents' credit card since high school. She calls and asks for your advice on both an auto loan and a credit card. Based on what your cousin wants to accomplish financially and her current financial obligations, would you advise her to apply for both types of credit? Why or why not?‚Äč

1 Answer

  • It would be more appropriate if your cousin did not request both types of credit at the same time.

    We can arrive at this answer because:

    • As we can see from the question above, your cousin has a limited amount of money.
    • In this case, requesting both types of credit would promote a lot of debt for her, which would be something negative to the salary she has.
    • This amount of debt could leave her without sufficient resources, besides that it could harm the car financing or the credit card application.

    In that case, you could advise your cousin to save money and buy a simpler and cheaper car while placing the credit card application.

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