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Financial Glossary

Understanding financial terminology is key to making informed decisions. Explore our comprehensive glossary of financial terms and concepts.

💰Loan & Credit

Annual Percentage Rate (APR)

The yearly cost of a loan including interest and other fees, expressed as a percentage of the loan amount.

Related terms:Interest RateProcessing FeeEMI

EMI (Equated Monthly Installment)

A fixed payment amount made by a borrower to a lender at a specified date each month. EMI consists of both principal and interest components.

Related terms:PrincipalInterest RateLoan Term

Processing Fee

A one-time fee charged by lenders for processing a loan application, typically a percentage of the loan amount.

Related terms:APRLoan AmountAdministrative Costs

🏦General Finance

Compound Interest

Interest calculated on the initial principal and also on the accumulated interest from previous periods. Often called "interest on interest".

Related terms:Simple InterestPrincipalAnnual Percentage Yield

Inflation

The rate at which the general level of prices for goods and services rises, reducing purchasing power over time.

Related terms:Real ValuePurchasing PowerCost of Living

Interest Rate

The percentage charged on the principal amount by a lender to a borrower for the use of money, typically expressed as an annual percentage.

Related terms:APRCompound InterestSimple Interest

Maturity

The date when a financial instrument (like a fixed deposit or loan) reaches the end of its term and becomes due for payment.

Related terms:PrincipalInterestTerm

Principal

The original amount of money borrowed in a loan or invested in a financial instrument, excluding interest or returns.

Related terms:InterestEMICompound Interest

Real Value

The value of money adjusted for inflation, representing the actual purchasing power at a given time.

Related terms:InflationNominal ValuePurchasing Power

📈Investment & Savings

Dollar Cost Averaging

An investment strategy where you invest a fixed amount regularly regardless of market conditions, potentially reducing the impact of volatility.

Related terms:SIPMarket VolatilityInvestment Strategy

Fixed Deposit (FD)

A financial instrument provided by banks where money is deposited for a fixed period at a predetermined interest rate.

Related terms:Interest RateMaturityCompound Interest

Mutual Fund

An investment vehicle that pools money from many investors to purchase securities like stocks, bonds, or other assets.

Related terms:SIPSWPPortfolioDiversification

Recurring Deposit (RD)

A special type of term deposit where you can deposit a fixed amount every month for a predetermined period and earn interest.

Related terms:Fixed DepositMonthly InvestmentCompound Interest

SIP (Systematic Investment Plan)

An investment strategy where you invest a fixed amount regularly in mutual funds or other investment vehicles, typically monthly.

Related terms:Mutual FundsCompound InterestDollar Cost Averaging

SWP (Systematic Withdrawal Plan)

A facility that allows investors to withdraw a fixed amount from their mutual fund investments at regular intervals.

Related terms:Mutual FundsRetirement PlanningCash Flow

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