The topic of credit utilization and financial health has become increasingly prevalent in IELTS Writing Task 2, appearing in various forms over the past few years. Based on analysis of recent exam patterns, questions about personal finance management and credit responsibility have appeared in approximately 15% of tests, particularly in countries with developing credit markets like India, China, and Vietnam.
importance of balancing credit with savings has become a crucial aspect that IELTS examiners are focusing on, especially when testing candidates’ ability to discuss economic topics.
Task Analysis
Some people believe that maintaining a good credit score is crucial for financial wellbeing, while others think saving money is more important. Discuss both views and give your opinion.
This question requires candidates to:
- Examine two contrasting viewpoints about financial management
- Provide balanced analysis of both perspectives
- Present and justify a personal stance
- Support arguments with relevant examples
Understanding the balance between credit scores and savings
Sample Essay 1 (Band 8.5)
In today’s complex financial landscape, there is ongoing debate about whether maintaining a strong credit score or building savings should be prioritized for financial security. While both aspects play vital roles, I believe that a balanced approach focusing slightly more on credit management is optimal for long-term financial health.
Those who advocate for prioritizing credit scores argue that good credit opens doors to crucial financial opportunities. A high credit score enables individuals to secure favorable interest rates on mortgages, business loans, and credit cards, potentially saving thousands in interest payments over time. Furthermore, many employers and landlords now check credit histories as part of their screening process, making good credit essential for career and housing opportunities.
Conversely, proponents of savings emphasize the importance of having readily available funds for emergencies and future goals. They contend that relying too heavily on credit can lead to debt cycles and financial instability, whereas savings provide a reliable safety net and peace of mind. Additionally, substantial savings can reduce dependency on credit and provide investment opportunities for wealth building.
In my view, while both elements are indispensable, maintaining good credit slightly edges out savings in importance. This is because how personal credit scores influence financial opportunities extends beyond mere borrowing capability – it affects various aspects of modern life, from employment to housing. However, the ideal approach involves balancing both: using credit responsibly while consistently building savings.
Strategic approach to managing credit and savings
Sample Essay 2 (Band 6.5)
Many people have different opinions about what is more important for financial health – having a good credit score or saving money. Both these things are important, but they work in different ways.
People who think credit scores are more important say that good credit helps get better loans. When someone wants to buy a house or start a business, banks look at their credit score. Bad credit means paying more money in interest, which is not good for anyone’s finances. Also, some companies check credit scores before giving jobs.
On the other hand, people who prefer saving money have good points too. Savings help in emergencies like medical problems or losing a job. When people have savings, they don’t need to use credit cards for unexpected expenses. This helps avoid debt problems that many people face today.
I think both things are important but in my opinion, importance of credit repair for better lending terms makes credit scores slightly more important. However, people should try to maintain both good credit and savings for the best financial situation.
Key Vocabulary
- Financial wellbeing (n) /faɪˈnænʃəl wel-ˈbiːɪŋ/ – state of being financially healthy
- Credit utilization (n) /ˈkredɪt juːtɪlaɪˈzeɪʃən/ – amount of credit being used
- Fiscal responsibility (n) /ˈfɪskəl rɪˌspɒnsəˈbɪləti/ – careful management of money
- Interest rates (n) /ˈɪntrəst reɪts/ – percentage charged for borrowing money
- Emergency fund (n) /ɪˈmɜːdʒənsi fʌnd/ – money saved for unexpected expenses
Writing Tips and Analysis
The Band 8.5 essay demonstrates:
- Sophisticated vocabulary and complex structures
- Clear organization and coherent arguments
- Effective use of examples and explanations
- Balanced discussion with clear personal stance
The Band 6.5 essay shows:
- Simple but clear language
- Basic organization of ideas
- Limited range of vocabulary
- Some development of arguments
Consider practicing with this similar topic:
“Some people believe digital payment systems are better for financial management than traditional banking. Discuss both views and give your opinion.”
Share your practice essays in the comments section for feedback and improvement suggestions.
