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Reference

Financial glossary

401(k)

A 401(k) is an employer-sponsored defined contribution retirement plan that lets eligible workers defer pay into investments under tax-advantaged rules.

50/30/20 Rule

The 50/30/20 rule is a flexible budgeting guideline that divides take-home pay among needs, wants, and saving or debt goals.

ACH Transfer

An ACH transfer is an electronic credit or debit sent between U.S. bank or credit-union accounts through the Automated Clearing House network under standardized authorization, settlement, and return rules.

APR (Annual Percentage Rate)

Annual percentage rate, or APR, is a standardized yearly measure of the cost of consumer credit, calculated under rules that vary by credit product and can include more than the stated interest rate.

APY (Annual Percentage Yield)

Annual percentage yield, or APY, is the percentage amount a deposit account would earn over a 365-day period under the disclosure assumptions, including the effect of compounding.

Amortization

Amortization is the process of repaying a loan through scheduled payments that cover accrued interest and reduce principal over time, typically bringing the balance to zero by the end of the stated term.

Annual Fee

An annual fee is a periodic charge for keeping a credit or charge card account available, disclosed by the issuer and economically justified only when usable incremental benefits exceed the fee and alternatives.

Balance Transfer

A balance transfer moves eligible debt to another credit-card account, commonly under a temporary promotional APR, while any transfer fee and remaining debt continue to require repayment.

Bitcoin

Bitcoin is a peer-to-peer electronic asset and payment network whose public transaction history is secured by proof-of-work, with ownership controlled through cryptographic keys and supply governed by protocol rules.

Blockchain

A blockchain is a shared digital ledger whose records are grouped and cryptographically linked so participating computers can agree on an ordered, tamper-evident history under a defined consensus protocol.

Bond

A bond is a debt security through which an investor lends money to an issuer in exchange for contractual payments and repayment terms, subject to credit and other risks.

Budgeting

Budgeting is the process of turning expected income and expenses into a written plan, then comparing that plan with actual cash flow.

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