Account balance refers to the amount of money available in a financial account at a given point in time. It is an essential concept in personal and business finance, indicating the net value of the account.
An aggregator is a firm that collates and presents information about an individual's bank accounts, investments, insurance policies, and other financial data, enabling the person to manage their financial affairs through a single platform.
Annuity income refers to the series of payments made at fixed intervals over a period of time, typically used as a stable source of cash flow during retirement.
A bank aggregator is a service or a platform that consolidates information from multiple bank accounts into a single, unified interface, facilitating ease of access and management of finances.
Bank Giro Credit (BGC) is a method used to transfer funds electronically from one bank account to another, often used for personal payments, utility bills, and other financial transactions.
A bank overdraft occurs when an account holder withdraws more money than is available in their bank account, creating a negative balance.
Bloomberg LP is a major business and financial news broadcaster, offering various services including interactive TV, telephone news services, a personal finance magazine, books, and radio and television broadcasts.
A budget deficit occurs when expenditures exceed income, and it can affect governments, corporations, and individuals. It necessitates funding solutions like issuing treasury bonds or reducing expenses.
Debt retirement refers to the repayment of outstanding debt, which is often achieved through mechanisms such as sinking funds, amortization, or prepayment. It is essential for managing corporate and personal finance efficiently.
Debt service coverage is a critical financial metric used in corporate, government, personal, and real estate finance to measure the availability of cash flow for meeting annual debt obligations.
A Dependency Exemption allows taxpayers to deduct a specified amount for each dependent claimed on their tax return, reducing their overall taxable income. It is designed to assist families by acknowledging the financial responsibility involved in supporting dependents.
A deposit account is a type of bank account held at a financial institution that allows the account holder to accumulate funds and earn interest, while typically requiring advance notice to withdraw money.
A deposit account is a bank account that allows a person to deposit money and earn interest while keeping the funds accessible for withdrawals and transactions.
Discretionary income is the amount of spendable income remaining after the purchase of physical necessities, such as food, clothing, and shelter, as well as the payment of taxes. Marketers of goods other than necessities compete for the consumer's discretionary dollars by appealing to various psychological needs, as distinguished from physical needs.
The spending capability that is not mandated by law or required automatically within the system, allowing individuals or organizations to allocate their funds according to their choices and preferences.
Dissaving, or negative saving, occurs when consumer spending exceeds disposable income, often financed through accumulated savings or loans.
A downpayment is the initial upfront portion of the total amount due for the purchase of property or goods, generally paid in cash, with the remaining balance being financed through debt.
The idiom 'feather one's nest' means to make a comfortable and secure living place, often for retirement. It can also imply misappropriating funds for personal benefit.
A financial planner is a professional who analyzes personal financial circumstances and prepares a program to meet financial needs and objectives, equipped with knowledge in several domains including estate planning, retirement planning, and investments.
A fixed-rate loan is a type of financing arrangement where the interest rate remains constant for the entire term of the loan, providing borrowers with predictable monthly payments.
A floating-rate loan has an interest rate that is not fixed and can fluctuate over the loan's tenure. These loans are often tied to short-term market indicators like the London Inter Bank Offered Rate (LIBOR).
Forced saving occurs when consumers are restricted from spending all their income on current consumption. This can be self-imposed, contractually obligated, or enforced by government policy.
A period of time provided in most loan contracts and insurance policies during which default or cancellation will not occur even though payment is past due.
Homeownership refers to the state of living in a structure that one owns, rather than renting or serving as a tenant. Owning a home provides financial stability and potential asset appreciation over time.
Individual life insurance provides coverage for a single life, as opposed to group life insurance, which covers multiple lives collectively. This type of insurance offers personalized policies tailored to the specific needs and circumstances of the individual.
An Individual Retirement Account (IRA) is a retirement savings account that provides tax advantages for retirement savings in the United States. It is designed to help individuals set aside funds for their retirement.
A tax-advantaged savings account available in the UK that allows individuals to save or invest a certain amount per year without paying personal income tax or capital gains tax on the earnings.
An Individual Voluntary Arrangement (IVA) is a legally binding agreement between a person and their creditors to pay off their debts over a specified period, often with reduced payments.
Interest income refers to the earnings obtained from various types of investments where the payment reflects the time value of money or from transactions where payments are made for the use or forbearance of money.
Itemized deductions are specific, individualized tax deductions allowed under provisions of the Internal Revenue Code and state and municipal tax codes for particular expenses incurred by the taxpayer during the taxable year. These deductions are permitted in computing taxable income, but there is an overall limitation on certain itemized deductions. An alternative to itemizing deductions is to claim the standard deduction.
Loan amortization refers to the reduction of debt by scheduled, regular payments of principal and interest sufficient to repay the loan at maturity. It is a fundamental concept in financial planning, allowing borrowers to understand how their loan is repaid over time.
A Loan Origination Fee is a charge levied by a lender for processing a new loan application, used as compensation for putting the loan in place.
The marginal tax rate is the tax rate applied to an additional dollar of income, influenced by the progressive nature of income tax systems.
Mortgage debt refers to the amount of money owed under a mortgage, which is a type of loan used particularly for financing the purchase of real estate.
A nest egg refers to assets saved or set aside for a significant purchase or a person's retirement. These assets are generally invested in conservative financial instruments to safeguard their value and ensure steady growth over time.
Non-taxable income refers to types of income specifically exempted from taxation by government regulations. Understanding which types of income are non-taxable can significantly affect an individual’s or business’s tax obligations.
A series of equal or nearly equal payments made at the end of each equally spaced period. An ordinary annuity is commonly used in financial products like mortgages, leases, bonds, and retirement accounts.
Ordinary income refers to normal income earned by individuals, such as wages, interest, and rents, which is fully subject to regular income tax rates. This contrasts with capital gains, which often benefit from reduced tax rates.
An Outstanding Balance is the amount of money currently owed on a debt. This figure represents the total unpaid portion of a loan, credit card, or other financial liability at any given time.
A detailed document that provides an individual's financial health using often the accrual basis of accounting.
Pin money refers to a small sum of money set aside for incidental or discretionary expenses. Historically, it reflects the concept of a small cash advance or stipend associated with household or personal use, sometimes part of a larger financial arrangement.
A profit-sharing plan is an agreement between a corporation and its employees which allows employees to share in the company's profits. Contributions are made annually by the company to an account for each employee, accumulating tax deferred until retirement or departure. Employees may be able to borrow against these funds for major expenditures.
Quicken is a popular financial recordkeeping software produced by Intuit, designed to manage personal and small business finance.
Retirement income refers to the various sources of funds that a retired individual receives, which can include Social Security benefits, pensions, annuities, and investment income. This income is critical for maintaining an individual's lifestyle once they are no longer earning a regular paycheck.
A revolving line of credit is a flexible borrowing option that allows individuals or businesses to access and repay funds on an as-needed basis up to a specified credit limit.
Savings refer to the amount of disposable income that is not spent on consumption. The percentage of gross income that is saved defines the savings rate, a key indicator of economic health.
A bank or building-society account designed for the investment of personal savings. These accounts typically offer higher interest rates than deposit and current accounts. Some accounts provide instant access to funds, while others require notice to be given, typically 30, 60, or 90 days.
The savings rate represents the portion of income that is saved rather than spent. It is an important economic indicator that reflects the propensity of individuals or economies to save.
The savings ratio, also known as the savings rate, is a financial metric that measures the proportion of disposable income that individuals or households save rather than spend on consumption. This ratio is typically expressed as a percentage and reflects the preference balance between present and future consumption.
An individual investor who buys small amounts of stock or bonds, often in odd-lot quantities; also called a retail investor.
Spendable income, also known as after-tax cash flow, refers to the amount of money an individual or business has available to spend after all taxes have been deducted from their gross income.
A tax bracket refers to a range of income that is taxed at a specific rate. As income increases and moves into higher brackets, the rate of taxation is adjusted according to predefined thresholds set by the tax authority.
A tax-free designation refers to any payment, allowance, or benefit that is not subject to taxation, providing financial advantages to recipients without impacting their taxable income.
Wealth refers to the value of all assets owned by an individual or entity, minus all outstanding debts. It serves as a stock measure of financial well-being, distinct from income, which is a flow measure of financial performance over a period.
