one way to establish credit is to take a small loan using a savings account as collateral and pay it back on…

one way to establish credit is to take a small loan using a savings account as collateral and pay it back on time. obtain a reference letter from an employer. directly deposit a paycheck in a savings account. make major purchases with cash rather than using credit cards.

one way to establish credit is to take a small loan using a savings account as collateral and pay it back on time. obtain a reference letter from an employer. directly deposit a paycheck in a savings account. make major purchases with cash rather than using credit cards.

Answer

Brief Explanations:

Taking a small loan using a savings account as collateral and paying it back on - time shows the ability to manage credit responsibly, which helps in building credit. A reference letter from an employer has no direct relation to credit - building. Directly depositing a paycheck in a savings account is a good savings habit but doesn't build credit. Making major purchases with cash doesn't contribute to building credit history as there is no borrowing and repayment activity.

Answer:

A. take a small loan using a savings account as collateral and pay it back on time.