Financial Counseling Certification Program (FiCEP) Practice Exam

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Master the Financial Counseling Certification Exam with our comprehensive quiz. Test your knowledge with multiple-choice questions and detailed explanations. Enhance your learning experience and boost your confidence ahead of the examination!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

Which of the following is essential for maintaining a good credit score?

Paying bills late occasionally
Keeping credit utilization low
Having multiple credit cards open
Not checking your credit report

The correct answer is: Keeping credit utilization low

Maintaining a good credit score is significantly influenced by keeping credit utilization low. Credit utilization refers to the ratio of your current credit card balances to your credit limits. This is an important factor in credit scoring models, as it reflects how much of your available credit you are using. A lower utilization ratio indicates to lenders that you are not overly reliant on credit and are managing your debt responsibly. Ideally, it is recommended to keep your utilization below 30%, or even lower for optimal scoring. By consistently keeping credit utilization low, individuals demonstrate good financial habits, which positively impacts their credit score and makes them more attractive to lenders. This practice signals that you are using credit responsibly, which can lead to better interest rates and loan approvals in the future.