Tag: savings

Reykjavik Interbank Offered Rate – REIBOR definition explanation

What is Reykjavik Interbank Offered Rate – REIBOR?
The formal interbank market rate for short term loans at Icelandic commercial and savings banks. Similar to how most countries use LIBOR as the base rate for variable rate loans, Icelandic banks use REIBOR (plus a premium) as the basis for supplying variable interest rate loans. Read more for examples and further explanation including related video clips and also comments
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Disintermediation definition explanation

What is Disintermediation?
1. In finance, withdrawal of funds from intermediary financial institutions, such as banks and savings and loan associations, in order to invest them directly.

2. Generally, removing the middleman or intermediary. Read more for examples and further explanation including related video clips and also comments
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Roth 401(k) definition explanation

What is Roth 401(k)?
An employer-sponsored investment savings account that is funded with after-tax money. After the investor reaches age 59.5, withdrawals of any money from the account (including investment gains) are tax-free. Unlike the Roth IRA, the Roth 401(k) has no income limitations for those investors who want to participate – anyone, no matter what his or her income, is allowed to invest up to the contribution limit into the plan. Read more for examples and further explanation including related video clips and also comments
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Growing-Equity Mortgage definition explanation

What is Growing-Equity Mortgage?
A fixed rate mortgage on which the monthly payments increase over time according to a set schedule. The interest rate on the loan does not change, and there is never any negative amortization. In other words, the first payment is a fully amortizing payment. As the payments increase, the additional amount above and beyond what would be a fully amortizing payment is applied directly to the remaining balance of the mortgage, shortening the life of the mortgage and increasing interest savings. Read more for examples and further explanation including related video clips and also comments
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Agency Matching Contributions definition explanation

What is Agency Matching Contributions?
A benefit that federal government employees receive under the thrift savings plan. More specifically, this refers to how the agency for which the individual is working will match 100% of the individual’s contributions up to the initial 3% of his or her pay and a contribution of $0.50 for every dollar from the next subsequent 2% of pay used toward contributing to the thrift savings plan. Read more for examples and further explanation including related video clips and also comments
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Universal Life Insurance definition explanation

What is Universal Life Insurance?
A type of flexible permanent life insurance offering the low-cost protection of term life insurance as well as a savings element (like whole life insurance) which is invested to provide a cash value buildup. The death benefit, savings element and premiums can be reviewed and altered as a policyholder’s circumstances change. In addition, unlike whole life insurance, universal life insurance allows the policyholder to use the interest from his or her accumulated savings to help pay premiums. Read more for examples and further explanation including related video clips and also comments
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Accumulation Period definition explanation

What is Accumulation Period?
1. The phase in an investor’s life when he/she builds up his/her savings and the value of his/her investment portfolio with the intention of having a nest egg for retirement.

2. In the context of a deferred annuity, the period of time when the annuitant is making contributions to the annuity and building up the value of his/her annuity account. This is usually followed by the annuitization phase, when guaranteed payments are paid out to the annuitant for a specified period of time (usually the rest of his/her life). Read more for examples and further explanation including related video clips and also comments
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Asset Management definition explanation

What is Asset Management?
1. The management of a client’s investments by a financial services company, usually an investment bank. The company will invest on behalf of its clients and give them access to a wide range of traditional and alternative product offerings that would not be to the average investor.

2. An account at a financial institution that includes checking services, credit cards, debit cards, margin loans, the automatic sweep of cash balances into a money market fund, as well as brokerage services.

Also known as an “”asset management account”” or a “”central asset account””. Read more for examples and further explanation including related video clips and also comments
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Cash Budget definition explanation

What is Cash Budget?
An estimation of the cash inflows and outflows for a business or individual for a specific period of time. Cash budgets are often used to assess whether the entity has sufficient cash to fulfill regular operations and/or whether too much cash is being left in unproductive capacities. Read more for examples and further explanation including related video clips and also comments
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