One of the most important equations you'll ever learn is Choices + Decisions = Consequences.

Someone buying something they need with cash

In other words, the social decisions and choices you make equal the consequences to your reputation. Likewise, the decisions and choices you make with your money equal the consequences to your financial future. Therefore, it is important to establish and maintain a positive credit history.

By maintaining good credit, by being responsible with your money, you will be able to earn better interest rates on loans. Interest is the fee a lender charges for the privilege of borrowing money. If you have good credit, you will earn lower interest rates; if you have bad credit, you will be assigned higher rates.