Annual Percentage Rate (APR) - The interest rate for a whole year, rather than just a monthly fee/rate, as applied to a loan, mortgage loan, credit card, etc.
It is a finance charge expressed as an annual rate.
Asset - Property owned by a person or business, regarded as having value and available to meet debts and commitments.
Budget - An estimate of income and expenses for a pre-set period of time.
Capital - Wealth in the form of money or other assets owned by a person or organization and available or contributed for a particular purpose such as starting a company or investing.
Credit score - A systematic way to rank an individual's likelihood of repaying an outstanding debt.
A credit score can rank from 300 to 850. Borrowers with scores above 700 are generally considered "Prime" and receive the best interest rates when they borrow.
Debt - Something, typically money, that is owed or due.
Debt Avalanche - An accelerated debt payoff plan, where a debtor allocates enough money to make the minimum payment on each debt, then devotes any remaining debt-repayment funds to the debt with the highest interest rate.
This method continues until all the debts are paid off.
Debt Snowball - Adebt reduction strategy, whereby one who owes on more than one account pays off the accounts starting with the smallest balances first, while paying the minimum payment on larger debts.
This method is most often applied to repaying revolving credit — such as credit cards.
Debt-to-Income (DTI) - A ratio that is determined by dividing your monthly debt payments by your monthly gross income.
Usually expressed as a percentage, lenders use it to determine how well you manage monthly debts, and if you can afford to repay a loan
Deflation - The decline in prices for goods and services.
It is usually caused by too much supply (overproduction) or an economic slowdown where demand decreases.
Expense - The cost required for something; the money spent on something.
FICO - The credit scores most lenders use to determine a borrower's credit risk. There are three FICO Scores, one for each of the three credit bureaus - Experian, TransUnion, and Equifax.
Each score is based on information the credit bureau keeps on file about consumers.
Income - Money (or some equivalent value) that an individual or business receives in exchange for providing a good or service or through investing capital.
Inflation - A general increase in prices paid during a period of time.
Inflation indices also measure the fall in the purchasing power of a currency over time as goods and services become more expensive.
Interest - The charge for the privilege of borrowing money, typically expressed as an annual percentage rate.
Liability - The future sacrifices of economic benefits that the entity is obliged to make to other entities as a result of past transactions or other past events.
Net Worth - The value of all assets, minus the total of all liabilities.
In other words, what is owned minus what is owed.
Return on Investment (ROI) - A measure of the gain or loss generated by an investment relative to the amount of money invested.