Financial Terms Glossary

Financial terms can be confusing. Here's some help with terms that you may see on this site.

Financial Terms Glossary

Financial terms can be confusing. Here's some help with terms that you may see on this site.

Term Definition
Account Balance The net of debits and credits for an account at the end of a reporting period.
Accounting To provide a record such as funds paid or received for a person or business. Accounting summarizes and submits this information in reports and statements. The reports are intended both for the firm itself and outside parties.
Allowance Something, such as money, given at regular times (for example, every month) or for a specific purpose.
Balance The amount of money in an account, determined by credits and debits.
Bank A financial institution that holds, lends and borrows currency.
Bartering To trade goods or services without the exchange of money.
Bill A piece of legal paper money
Budget A written plan for spending and allocating money.
Cash Money in the form of bills or coins; currency.
Cash On Hand Currency that can be accessed immediately.
Checking Account Deposited funds designed for easy and frequent withdrawals.
Coin A small piece of metal, usually flat and circular, used as money.
Compound Interest A method of calculating interest in which accrued interest is added to the principle sum, and the new total is principle.
Credit Money loaned or borrowed, or the ability to loan or borrow money. Also a deposit in an account.
Credit Card A plastic card issued by a lender that allows the holder to purchase items on credit.
Credit Union A non-profit and tax-exempt financial institution that holds, lends and borrows currency for its members.
Currency Money in any form, especially circulating paper money.
Debit The amount taken out of an account.
Deposit To put money into an account.
Divedends Profits paid to shareholders
Donation Something, such as money or goods given to a fund or cause.
Earn To gain something for the performance of service, labor or work.
Earning Power An individual’s ability to exchange work, goods or services for income.
Expenses The costs of living
Goods Items for trade or sale.
Income The amount of money made from work or sales.
Interest The cost of borrowing money.
Investment Money used to create profit.
Loan Something, like money, lent for temporary use.
Money Something that can be exchanged for goods and services.
Mutual Fund A company that pools the funds of multiple investors and them manages those investments.
Owe To have to pay for something, like goods or services.
Paper Money Currency in the form of government notes and bank notes.
Pay To give money in return for goods or services.
Price The amount of money or goods asked for or given in exchange for something else.
Principal The initial amount of money loaned or borrowed.
Purchase The act of buying; something that has been bought.
Refund A repayment of funds.
Register A device for recording financial transactions.
Save To set aside for future use.
Savings Something set aside and not used, such as money in a bank account.
Savings Account Deposited funds created to facilitate long-term financial growth.
Services Tasks performed in exchange for payment.
Share To divide and parcel out in portions.
Shareholder Someone who owns stock in a company.
Simple Interest A method of calculating interest that only considers the principle amount of the loan.
Spend To pay out money.
Statement Of Account A financial institution’s records of transactions in various accounts.
Stock Ownership in a company.
Stock Market The exchange of stocks.
Tax A percentage added to a purchase that is paid to the government.
Term Deposit An interest-earning savings vehicle that requires the invested funds to sit untouched for a specified period of time.
Value An amount of goods, services or money considered to be a fair exchange, or equal in worth to something else. To rate the worth of something.
Withdraw To take something like money out of an account.

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