Money Dictionary

The Finance Glossary

Every money term, explained in plain language — no jargon, no gatekeeping. Search, filter by topic, or browse A–Z.

511 terms

A

Acceleration Clause

A loan term letting the lender demand full repayment immediately if you miss payments.

Debt

Accounts Payable

Money a business owes to suppliers for goods and services received but not yet paid for.

Business

Accounts Receivable

Money owed to a business by customers who bought on credit.

Business

Accrued Interest

Interest that has built up on a loan or bond but has not yet been paid.

Debt

Acquirer

A company that purchases another company in a merger or acquisition.

Business

Active Investing

A strategy of picking individual investments to try to beat the market, rather than tracking an index.

Investing

Adjustable-Rate Mortgage (ARM)

A home loan whose interest rate can change over time based on market rates.

Debt

Alpha

The return an investment earns above its benchmark — a measure of a manager's skill.

Investing

Alternative Investment

Assets outside stocks, bonds, and cash — like real estate, art, or private equity.

Investing

Amortization

Paying off a loan over time with scheduled payments that cover both principal and interest.

Debt

Angel Investor

A wealthy individual who funds early-stage startups with personal money in exchange for equity.

Business

Annual Report

A company's yearly publication of financial results and strategy for shareholders.

Business

Annuity

A contract, usually with an insurer, that pays you a regular income stream in exchange for an upfront sum.

Investing

Appreciation

An increase in an asset's value over time.

Investing

APR (Annual Percentage Rate)

The yearly cost of borrowing money, including interest and fees, expressed as a percentage.

Debt

APY (Annual Percentage Yield)

The real rate of return on savings or deposits in one year, including the effect of compounding.

Banking

Arbitrage

Profiting from price differences of the same asset in different markets.

Crypto & Markets

Ask Price

The lowest price a seller is willing to accept for an asset.

Crypto & Markets

Assessed Value

The value a tax authority assigns to property for calculating property taxes.

Budgeting

Asset

Anything you own that has value: cash, property, investments, or a business.

Investing

Asset Allocation

How you divide your portfolio among stocks, bonds, cash, and other asset classes based on your goals and risk tolerance.

Investing

Audit

An independent examination of financial records to confirm they are accurate.

Business

AUM (Assets Under Management)

The total market value of investments a fund or advisor manages for clients.

Investing

Auto-Debit

An arrangement where bills are paid automatically from your account on their due dates.

Banking

B

Balance Sheet

A snapshot of what a person or business owns (assets) and owes (liabilities) at a point in time.

Business

Balance Transfer

Moving credit card debt to another card, usually to get a lower promotional interest rate.

Debt

Balloon Payment

A large final payment at the end of a loan after smaller periodic payments.

Debt

Bank Draft

A payment guaranteed by a bank, drawn on its own funds rather than yours directly.

Banking

Bank Rate

The rate at which a central bank lends to commercial banks, shaping all other interest rates.

Banking

Bank Run

When many depositors withdraw at once fearing a bank's collapse — which can cause it.

Banking

Bankruptcy

A legal process for people or businesses unable to repay debts, offering relief or restructuring.

Debt

Basis Point

One hundredth of a percentage point (0.01%) — the unit used to describe rate changes.

Crypto & Markets

Bear Market

A period when asset prices fall 20% or more from recent highs, usually with widespread pessimism.

Crypto & Markets

Benchmark

A standard, like an index, used to measure an investment's performance.

Investing

Beneficiary

The person or entity designated to receive assets from a will, trust, or account.

Budgeting

Beta

A measure of how much a stock moves relative to the overall market.

Investing

Bid Price

The highest price a buyer is willing to pay for an asset.

Crypto & Markets

Bid-Ask Spread

The gap between the highest buyer's price and lowest seller's price — a hidden cost of trading.

Crypto & Markets

Bitcoin

The first and largest cryptocurrency, created in 2009 as decentralized digital money.

Crypto & Markets

Blockchain

A shared, tamper-resistant digital ledger recording transactions across many computers.

Crypto & Markets

Blue-Chip Stock

Shares of large, established, financially sound companies with long track records.

Investing

Bond

A loan you give to a government or company in exchange for regular interest payments and your money back at maturity.

Investing

Bond Ladder

Buying bonds with staggered maturity dates to spread interest-rate risk and create steady cash flow.

Investing

Bond Yield

The return a bond investor earns, expressed as a percentage of its price.

Investing

Book Value

A company's net asset value on its balance sheet: assets minus liabilities.

Business

Bookkeeping

The day-to-day recording of a business's financial transactions.

Business

Bootstrapping

Building a business with personal savings and revenue instead of outside investment.

Business

Break-Even Point

The sales or revenue level where total income exactly covers total costs.

Business

Broker

A licensed intermediary who buys and sells investments on your behalf.

Investing

Brokerage Account

An account with a licensed firm that lets you buy and sell investments.

Investing

Budget

A plan for how you will earn, spend, save, and invest your money over a set period.

Budgeting

Budget Deficit

When spending exceeds income over a period, forcing borrowing or dipping into savings.

Budgeting

Bull Market

A period of rising asset prices, typically driven by optimism and strong economic performance.

Crypto & Markets

Burn Rate

How fast a startup spends its cash before reaching profitability.

Business

Buy and Hold

A long-term strategy of purchasing investments and keeping them through market swings.

Investing

C

Callable Bond

A bond the issuer can repay early, usually when interest rates fall.

Investing

Capital Expenditure (CapEx)

Money spent on long-term assets like buildings, equipment, or vehicles.

Business

Capital Gains

The profit you make when you sell an asset for more than you paid for it.

Investing

Capital Loss

The loss you realize when you sell an asset for less than you paid for it.

Investing

Cash Flow

The movement of money in and out of your account or business over a period.

Business

Cash Flow Statement

A report tracking how cash enters and leaves a business across operations, investing, and financing.

Business

Cash Reserve

Liquid funds a person or business keeps for emergencies or opportunities.

Budgeting

Cash-Out Refinance

Replacing your mortgage with a larger one and taking the difference in cash.

Debt

Central Bank

A national institution, like the CBN or the Fed, that manages currency, interest rates, and bank regulation.

Banking

Certificate of Deposit (CD)

A savings product that locks your money for a fixed term in exchange for a guaranteed rate.

Banking

Chapter 7 / Chapter 13

US bankruptcy types: liquidation of assets vs. a court-approved repayment plan.

Debt

Charge-Off

When a lender writes off an unpaid debt as a loss — it still damages your credit and you may still owe it.

Debt

Chargeback

Reversing a card transaction through your bank when goods were faulty or the charge was fraudulent.

Banking

Checking Account

A bank account for everyday transactions: deposits, withdrawals, and payments.

Banking

Circuit Breaker

An automatic trading halt triggered when markets fall sharply, designed to calm panic.

Crypto & Markets

Closed-End Fund

A fund with a fixed number of shares that trades on an exchange, sometimes above or below asset value.

Investing

Co-Signer

A person who signs a loan with you and is equally responsible for repaying it.

Debt

Cognitive Bias (Money)

Mental shortcuts — like loss aversion or herd mentality — that lead to irrational financial decisions.

Budgeting

Cold Wallet

A crypto wallet kept offline, far safer from hacks than an internet-connected one.

Crypto & Markets

Collateral

An asset you pledge to a lender to secure a loan; they can seize it if you default.

Debt

Collections

When an unpaid debt is handed to a collection agency that pursues you for payment.

Debt

Commercial Paper

Short-term unsecured debt large companies issue to fund immediate needs.

Business

Commodification of Debt

Bundling loans into tradable securities sold to investors — also called securitization.

Debt

Commodity

A raw material traded in bulk, like gold, oil, cocoa, or wheat.

Crypto & Markets

Compound Annual Growth Rate (CAGR)

The smoothed annual growth rate of an investment over multiple years.

Investing

Compound Interest

Interest calculated on both the original amount and accumulated interest — the engine of long-term wealth.

Investing

Consolidation Loan

A single loan used to pay off multiple debts, ideally at a lower rate with one monthly payment.

Debt

Consumer Price Index (CPI)

A measure of inflation tracking the average change in prices consumers pay for goods and services.

Crypto & Markets

Contribution Margin

Revenue minus variable costs — how much each sale contributes toward covering fixed costs.

Business

Convertible Bond

A bond that can be exchanged for a set number of the issuer's shares.

Investing

Correction

A market decline of 10% to 20% from a recent peak — shorter and milder than a bear market.

Crypto & Markets

Cost Basis

What you originally paid for an investment, used to calculate taxable gains or losses.

Investing

Cost of Living

The amount of money needed to cover basic expenses like housing, food, and transport in a place.

Budgeting

Counterparty Risk

The chance the other side of a financial deal fails to deliver on its obligation.

Crypto & Markets

Coupon Rate

The fixed annual interest a bond pays as a percentage of its face value.

Investing

Credit Bureau

An agency that collects borrowing histories and produces credit reports and scores.

Debt

Credit Card Grace Period

The window between a purchase and its due date during which no interest accrues if you pay in full.

Debt

Credit Freeze

Locking your credit file so no new credit can be opened — a strong defense against identity theft.

Debt

Credit Limit

The maximum amount a lender lets you borrow on a credit card or credit line.

Debt

Credit Report

A detailed record of your borrowing history, accounts, and payment behavior.

Debt

Credit Score

A three-digit number that rates your creditworthiness based on your borrowing and repayment history.

Debt

Credit Utilization

The share of your available credit you're using — keeping it low helps your credit score.

Debt

Crowdfunding

Raising small amounts of money from many people online to fund a project or business.

Business

Cryptocurrency

Digital money built on blockchain technology, transferred without a central bank.

Crypto & Markets

Current Ratio

Current assets divided by current liabilities — a quick test of a business's short-term health.

Business

Custodian

A financial institution that holds and safeguards your investments.

Banking

D

Dark Pool

A private trading venue where large investors trade away from public exchanges.

Crypto & Markets

Day Trading

Buying and selling securities within the same day to profit from small price moves.

Crypto & Markets

Debenture

A bond not backed by collateral, relying only on the issuer's creditworthiness.

Investing

Debit Card

A payment card that draws money directly from your bank account.

Banking

Debt Avalanche

A payoff method where you attack the highest-interest debt first to minimize total interest paid.

Debt

Debt Counseling

Professional guidance to restructure and repay overwhelming debt, often via a management plan.

Debt

Debt Management Plan (DMP)

An arranged schedule where a counselor negotiates lower rates and you make one monthly payment.

Debt

Debt Service Coverage Ratio (DSCR)

Income available to pay debt divided by required debt payments — lenders watch it closely.

Business

Debt Snowball

A payoff method where you clear the smallest debt first for momentum, then roll payments into the next.

Debt

Debt-to-Income Ratio (DTI)

Your monthly debt payments divided by your monthly gross income — lenders use it to judge borrowing capacity.

Debt

Deferred Payment

An arrangement allowing you to receive goods now and pay for them later.

Debt

DeFi (Decentralized Finance)

Financial services like lending and trading built on blockchains without traditional intermediaries.

Crypto & Markets

Defined Benefit Plan

A pension promising a set retirement income, usually based on salary and years of service.

Investing

Defined Contribution Plan

A retirement plan where you (and often your employer) contribute, and the outcome depends on investment growth.

Investing

Deflation

A general decline in prices, which increases the purchasing power of money but can slow economic growth.

Crypto & Markets

Delinquency

Being late on a loan payment; prolonged delinquency leads to default.

Debt

Delisting

Removing a company's shares from a stock exchange, usually for failing listing rules.

Crypto & Markets

Depreciation

The decline in an asset's value over time through use or obsolescence.

Business

Derivative

A contract whose value is based on an underlying asset, like options or futures.

Crypto & Markets

Devaluation

A government's deliberate reduction of its currency's value against others.

Crypto & Markets

Direct Debit

Permission for a company to pull payments from your bank account automatically.

Banking

Discretionary Spending

Non-essential spending you could cut without affecting basics — wants, not needs.

Budgeting

Disposable Income

Income left after taxes, available for spending and saving.

Budgeting

Distribution

A payment a fund makes to its investors from income or realized gains.

Investing

Diversification

Spreading investments across different assets to reduce the impact of any single loss.

Investing

Dividend

A portion of a company's profits paid out to shareholders, usually quarterly.

Investing

Dividend Aristocrat

A company that has raised its dividend every year for at least 25 consecutive years.

Investing

Dividend Reinvestment Plan (DRIP)

Automatically using dividends to buy more shares instead of taking cash.

Investing

Dividend Yield

Annual dividends per share divided by the share price — the income return of a stock.

Investing

Dollar-Cost Averaging

Investing a fixed amount regularly regardless of price, smoothing out market ups and downs.

Investing

Down Payment

The upfront portion you pay when buying a home or car on credit.

Debt

Drawdown

The decline from a portfolio's peak to its trough — a measure of pain during downturns.

Investing

Due Diligence

The research done before an investment or business deal to verify facts and risks.

Business

Dutch Auction

A pricing method where the price starts high and drops until buyers accept it.

Crypto & Markets

E

Earnings Per Share (EPS)

A company's profit divided by its number of shares — a core profitability measure.

Investing

Earnings Season

The weeks each quarter when most public companies report their financial results.

Crypto & Markets

EBITDA

Earnings before interest, taxes, depreciation, and amortization — a rough gauge of operating profitability.

Business

Economic Indicator

Statistics like GDP, unemployment, and CPI that reveal the economy's health.

Crypto & Markets

Emergency Fund

Three to six months of living expenses kept in an accessible account for unexpected events.

Budgeting

Emergency Levy

A temporary extra tax a government imposes during a crisis.

Budgeting

Emerging Markets

Countries with fast-growing but riskier economies, like Nigeria, Brazil, or Vietnam.

Crypto & Markets

Employee Stock Ownership Plan (ESOP)

A program giving workers ownership shares in their company.

Business

Endowment

A fund of donated money invested to support an institution like a university forever.

Investing

Equity

Ownership value in an asset — like the part of your home you truly own, or shares in a company.

Investing

Equity Financing

Raising money by selling ownership shares rather than borrowing.

Business

Equity Risk Premium

The extra return investors demand for holding stocks instead of safe bonds.

Investing

Escrow

Money or assets held by a neutral third party until a transaction's conditions are met.

Banking

Estate Planning

Arranging how your assets will be managed and distributed after death, including wills and trusts.

Budgeting

ETF (Exchange-Traded Fund)

A fund that trades on the stock exchange like a single share but holds many underlying assets.

Investing

Ethereum

A blockchain platform enabling smart contracts and most DeFi and NFT activity; its currency is ether.

Crypto & Markets

Exchange Rate

The price of one currency in terms of another.

Crypto & Markets

Exchange-Traded Note (ETN)

An unsecured debt security that tracks an index and trades like a stock.

Investing

Executor

The person named in a will to carry out the deceased's wishes and settle the estate.

Budgeting

Exit Strategy

An investor's or founder's plan for selling their stake to realize returns.

Business

Expected Return

The probability-weighted average return an investment is projected to earn.

Investing

Expense Ratio

The annual fee a fund charges, expressed as a percentage of your investment.

Investing

F

Face Value

The nominal value printed on a bond or security, repaid at maturity.

Investing

Fiat Currency

Government-issued money not backed by gold or any commodity — like the naira or dollar.

Banking

FICO Score

The most widely used credit-scoring model in the US, ranging from 300 to 850.

Debt

Fiduciary

A financial advisor legally required to act in your best interest, not theirs.

Investing

Financial Independence (FI)

Having enough invested assets that work becomes optional — the core of the FIRE movement.

Budgeting

Fintech

Technology-driven financial services, from payment apps to digital-only banks.

Banking

FIRE Movement

Financial Independence, Retire Early — extreme saving and investing to quit work decades ahead of schedule.

Budgeting

Fiscal Policy

Government decisions on spending and taxation that influence the economy.

Crypto & Markets

Fiscal Year

A 12-month accounting period, not necessarily matching the calendar year.

Business

Fixed Expenses

Costs that stay the same each month, like rent, subscriptions, and loan payments.

Budgeting

Fixed Income

Investments that pay a set return, like bonds and treasury bills.

Investing

Fixed-Rate Loan

A loan whose interest rate never changes over its term.

Debt

Float

The number of a company's shares actually available for public trading.

Crypto & Markets

Floating Rate

An interest rate that moves up or down with a benchmark over time.

Debt

FOMO

Fear of missing out — the emotional trap that pushes people into overpriced assets and bad trades.

Budgeting

Foreclosure

The legal process where a lender seizes and sells a property after mortgage default.

Debt

Forex (FX)

The global marketplace for exchanging one currency for another.

Crypto & Markets

Forward Contract

A private agreement to exchange an asset at a set price on a future date.

Crypto & Markets

Fractional Share

Buying a portion of one share, letting you invest in expensive stocks with small amounts.

Investing

Fraud Alert

A notice placed on your credit file telling lenders to verify your identity before issuing credit.

Banking

Front-Running

Illegally trading ahead of a large order you know is coming to profit from its price impact.

Crypto & Markets

Frugal Fatigue

The burnout that comes from cutting spending too hard for too long — often causes binge spending.

Budgeting

Fund Manager

The professional who decides what a mutual fund or portfolio buys and sells.

Investing

Fund of Funds

A fund that invests in other funds rather than directly in securities.

Investing

Fungibility

The property of being interchangeable — one naira equals any other naira; NFTs are the opposite.

Crypto & Markets

Futures Contract

An agreement to buy or sell an asset at a set price on a future date.

Crypto & Markets

G

Garnishment

A court order directing money to be taken from your wages or account to repay a debt.

Debt

Gas Fee

The cost paid to process a transaction on a blockchain like Ethereum.

Crypto & Markets

GDP (Gross Domestic Product)

The total value of goods and services a country produces — a key measure of economic health.

Crypto & Markets

General Partnership

A business owned by two or more people who share profits, losses, and unlimited liability.

Business

Gilt

A bond issued by the UK government; broadly, any very safe government bond.

Investing

Going Concern

The assumption that a business will keep operating for the foreseeable future.

Business

Gold Standard

A historic system where currency value was directly tied to a fixed amount of gold.

Crypto & Markets

Good Till Canceled (GTC)

A trade order that stays active until it executes or you cancel it.

Crypto & Markets

Grace Period

Extra time after a due date during which you can pay without penalty.

Debt

Gross Domestic Savings

The portion of GDP a country saves rather than consumes.

Crypto & Markets

Gross Income

Your total income before taxes and deductions are taken out.

Budgeting

Gross Margin

Revenue minus cost of goods sold, shown as a percentage — how much you keep per sale before overheads.

Business

Growth Rate

The percentage change in revenue, profit, or an economy over a period.

Business

Growth Stock

Shares in companies expected to grow faster than the market, often reinvesting profits instead of paying dividends.

Investing

Guarantor

A person who agrees to repay a loan if the borrower defaults.

Debt

H

Hard Asset

A physical asset with intrinsic value — real estate, gold, equipment.

Investing

Hard Inquiry

A credit check triggered by a loan or card application, which can slightly lower your credit score.

Debt

Harmonized Index of Consumer Prices

The EU's standard inflation measure, comparable across member countries.

Crypto & Markets

Hedge

An investment made to reduce the risk of loss in another investment.

Investing

Hedge Fund

A private investment fund using aggressive strategies, open mainly to wealthy investors.

Investing

High-Yield Savings Account

A savings account paying significantly more interest than standard accounts, usually from digital banks.

Banking

HODL

Crypto slang for holding an asset long-term through volatility instead of selling.

Crypto & Markets

Home Equity

The market value of your home minus what you still owe on the mortgage.

Debt

Home Equity Loan

A loan that lets you borrow against the equity you've built in your home.

Debt

Homeowners Insurance

Coverage protecting your property and belongings against damage, theft, and liability.

Budgeting

Hot Wallet

An internet-connected crypto wallet — convenient but more vulnerable to hacks.

Crypto & Markets

Household Debt

The total borrowing of families: mortgages, cards, student and car loans.

Debt

Human Capital

The economic value of your skills, knowledge, and ability to earn.

Budgeting

Hyperinflation

Extremely rapid and out-of-control price increases that destroy a currency's value.

Crypto & Markets

I

Illiquid Asset

An asset that's hard to sell quickly without a big price cut — like property or private company shares.

Investing

Impaired Asset

An asset whose recoverable value has fallen below its book value.

Business

Income Fund

A fund focused on generating regular payouts from dividends and interest rather than growth.

Investing

Income Statement

A financial report showing revenue, expenses, and profit over a period.

Business

Incubator

A program that helps very early startups with workspace, mentoring, and small funding.

Business

Indemnity

A contractual promise to compensate for loss or damage — the basis of insurance.

Business

Index

A statistical measure of a market segment, like the S&P 500 or the NGX All-Share Index.

Crypto & Markets

Index Fund

A fund that tracks a market index (like the S&P 500 or NGX All-Share) instead of trying to beat it.

Investing

Inflation

The rate at which prices rise over time, reducing what your money can buy.

Crypto & Markets

Initial Margin

The deposit required to open a leveraged trading position.

Crypto & Markets

Insider Trading

Illegally buying or selling shares based on confidential company information.

Crypto & Markets

Insolvency

Being unable to pay debts as they fall due — it can lead to bankruptcy.

Debt

Installment Loan

A loan repaid in fixed scheduled payments, like a car or personal loan.

Debt

Institutional Investor

A large organization that invests pooled money: pension funds, insurers, mutual funds.

Investing

Interest Coverage Ratio

Operating profit divided by interest expense — shows how easily a company pays its interest.

Business

Interest Rate

The cost of borrowing money or the reward for saving it, expressed as a percentage.

Banking

Interest-Only Loan

A loan where early payments cover only interest, with principal repaid later.

Debt

Internal Rate of Return (IRR)

The annualized growth rate that makes an investment's future cash flows equal its cost today.

Investing

Intestate

Dying without a valid will, leaving the law to decide who inherits.

Budgeting

Investment Grade

A credit rating signaling low default risk for a bond issuer.

Investing

Invoice Factoring

Selling your unpaid invoices to a company at a discount for immediate cash.

Business

IPO (Initial Public Offering)

The first sale of a company's shares to the public on a stock exchange.

Crypto & Markets

IRA (Individual Retirement Account)

A US retirement account with tax advantages; variants include Traditional and Roth.

Investing

J

Joint Account

A bank account shared by two or more people, all with access to the funds.

Banking

Joint Venture

Two or more parties teaming up on a specific business project while remaining separate entities.

Business

Jumbo Loan

A mortgage exceeding the standard limits set by regulators, with stricter approval terms.

Debt

Junk Bond

A high-yield bond from an issuer with weak credit — more return, much more risk.

Investing

K

Keogh Plan

A US tax-deferred retirement plan for self-employed people and small businesses.

Investing

Key Person Insurance

A policy paying a business if a critical employee or founder dies or becomes disabled.

Business

Key Rate Duration

A measure of how sensitive a bond's price is to interest-rate changes at specific maturities.

Investing

Kickback

An illegal secret payment made in return for favorable treatment — a form of bribery.

Business

KYC (Know Your Customer)

The identity-verification process banks and fintechs use before opening accounts.

Banking

L

Lapsed Policy

An insurance policy that ended because premiums were not paid.

Budgeting

Large-Cap

Companies with very large market capitalizations, typically $10 billion and above.

Investing

Last Will and Testament

A legal document stating how your assets should be distributed after death.

Budgeting

Late Fee

A penalty charged when you miss a payment due date.

Debt

Lease

A contract to use an asset — a car, equipment, property — for payments over time without owning it.

Debt

Ledger

The record book where all financial transactions of a business are logged.

Business

Legal Tender

Money that must by law be accepted for payment of debts in a country.

Banking

Letter of Credit

A bank's guarantee that a buyer's payment to a seller will be received on time and in full.

Banking

Leverage

Using borrowed money to invest or operate, amplifying both gains and losses.

Investing

Liability

Anything you owe: loans, credit card balances, mortgages, unpaid bills.

Debt

Lien

A legal claim a lender has on your property until a debt is repaid.

Debt

Lifestyle Creep

Spending more as you earn more, so saving never actually grows with your income.

Budgeting

Limit Order

An order to buy or sell only at a specified price or better.

Crypto & Markets

Limited Liability Company (LLC)

A business structure protecting owners' personal assets from company debts.

Business

Line of Credit

A flexible loan letting you borrow up to a limit, repay, and borrow again.

Debt

Liquidation

Selling off a company's assets to pay creditors when it closes.

Business

Liquidity

How quickly an asset can be converted to cash without losing value. Cash is perfectly liquid; property is not.

Investing

Liquidity Ratio

Measures of how easily an entity can pay its short-term obligations.

Business

Listed Company

A company whose shares trade publicly on a stock exchange.

Crypto & Markets

Load Fee

A sales commission charged when you buy (front-load) or sell (back-load) certain mutual funds.

Investing

Loan Amortization Schedule

A table showing every loan payment split into interest and principal over the loan's life.

Debt

Loan Shark

An illegal lender charging extreme interest, often using threats to collect.

Debt

Loan-to-Value Ratio (LTV)

The loan amount as a percentage of the asset's value — key in mortgage lending.

Debt

Long Position

Owning an asset expecting its price to rise.

Crypto & Markets

Loss Aversion

The psychological tendency to feel losses roughly twice as strongly as equal gains.

Budgeting

Lump Sum

A single large payment instead of a series of smaller ones.

Investing

M

Maker-Taker Fees

Exchange fees where adding liquidity (maker) costs less than removing it (taker).

Crypto & Markets

Managed Account

An investment account where a professional makes trading decisions for you.

Investing

Margin

Borrowed money from a broker used to buy investments — amplifies both gains and losses.

Crypto & Markets

Margin Call

A broker's demand to add cash or securities when your leveraged position loses value.

Crypto & Markets

Market Capitalization

A company's total value on the stock market: share price times number of shares.

Crypto & Markets

Market Correction

A decline of around 10% that resets overheated prices without becoming a bear market.

Crypto & Markets

Market Maker

A firm that continuously quotes buy and sell prices to keep a market liquid.

Crypto & Markets

Market Order

An order to buy or sell immediately at the best available price.

Crypto & Markets

Market Timing

Trying to buy low and sell high by predicting market moves — notoriously hard to do consistently.

Investing

Maturity Date

The date a bond or loan must be fully repaid.

Investing

Maturity Value

The amount paid when a bond, deposit, or policy reaches its end date.

Investing

Merchant Account

A bank account letting a business accept card payments.

Banking

Micro-Investing

Investing tiny amounts regularly, often by rounding up purchases through an app.

Investing

Microfinance

Small loans and financial services for low-income entrepreneurs excluded from traditional banking.

Banking

Minimum Payment

The smallest amount you must pay on a credit card each month to avoid penalties.

Debt

Monetary Policy

Central bank actions — mainly interest rates and money supply — that steer the economy.

Crypto & Markets

Money Market Fund

A low-risk fund investing in short-term government and corporate debt, popular for parking cash.

Investing

Money Order

A prepaid paper payment instrument, a safe alternative to cash or personal checks.

Banking

Money Supply

The total money circulating in an economy — tracked by central banks to manage inflation.

Crypto & Markets

Moonshot

An extremely high-risk investment or venture with the potential for outsized returns.

Crypto & Markets

Moral Hazard

When protection from risk (like insurance or bailouts) encourages recklessness.

Crypto & Markets

Mortgage

A long-term loan used to buy property, with the property itself as collateral.

Debt

Moving Average

An average of prices over a set period, used to spot trends in technical analysis.

Crypto & Markets

Multiplier Effect

How an initial injection of spending ripples through the economy creating more total income.

Crypto & Markets

Mutual Fund

A pooled investment where a professional manager invests many people's money across assets.

Investing

N

NASDAQ

A major US stock exchange known for technology companies; also an index of its largest stocks.

Crypto & Markets

Negative Amortization

When loan payments don't cover the interest, so your balance actually grows.

Debt

Negative Equity

Owing more on an asset (like a home or car) than it is currently worth.

Debt

Negotiable Instrument

A signed document promising payment, transferable between parties — like checks and promissory notes.

Banking

Net 30

An invoice term requiring payment within 30 days of the invoice date.

Business

Net Asset Value (NAV)

A fund's per-share value: total assets minus liabilities, divided by shares.

Investing

Net Income

What you actually take home after taxes and deductions — the number your budget should be built on.

Budgeting

Net Profit Margin

The percentage of revenue left as profit after all expenses.

Business

Net Worth

Everything you own (assets) minus everything you owe (liabilities). The true scoreboard of wealth.

Budgeting

NFT (Non-Fungible Token)

A unique digital asset verified on a blockchain, often tied to art or collectibles.

Crypto & Markets

No-Fee (No-Load) Fund

A mutual fund that charges no sales commission when you buy or sell.

Investing

Nominal Interest Rate

The stated interest rate before adjusting for compounding or inflation.

Banking

Non-Performing Loan

A loan on which the borrower has stopped making payments for an extended period.

Debt

Notary Public

An official authorized to witness and certify signatures on legal documents.

Business

O

Offshore Account

A bank account held outside your country of residence, legal if properly declared.

Banking

Open-End Fund

A mutual fund that creates or redeems shares on demand at net asset value.

Investing

Operating Expenses (OpEx)

The ongoing costs of running a business: rent, salaries, utilities, marketing.

Business

Operating Leverage

The degree to which a company's costs are fixed — high fixed costs magnify profit swings.

Business

Opportunity Cost

What you give up when you choose one option over another — the hidden cost of every financial decision.

Budgeting

Option (Contract)

A contract giving you the right, but not the obligation, to buy or sell an asset at a set price before a deadline.

Crypto & Markets

Origination Fee

An upfront charge a lender takes for processing a new loan.

Debt

Overdraft

Spending more than you have in your account, usually triggering fees from the bank.

Banking

Overdraft Protection

A bank feature that covers transactions when your balance runs short, usually for a fee or by linking savings.

Banking

Overnight Rate

The interest rate at which banks lend to each other for one day, guided by the central bank.

Banking

Overvalued

An asset trading above what its fundamentals justify.

Crypto & Markets

P

P/E Ratio (Price-to-Earnings)

A company's share price divided by its earnings per share — a common valuation yardstick.

Investing

Paper Trading

Practicing investing with simulated money before risking real funds.

Crypto & Markets

Par Value

The face value of a bond or the nominal value of a share set at issuance.

Investing

Passbook Savings

The traditional savings account where transactions were recorded in a physical booklet.

Banking

Passive Income

Money earned with minimal ongoing effort, like dividends, rent, or royalties.

Budgeting

Pay Yourself First

The budgeting rule of moving money to savings before spending on anything else.

Budgeting

Payday Loan

A small, extremely high-interest loan due on your next payday — a dangerous debt trap.

Debt

Payment Holiday

An agreed temporary pause on loan repayments, usually during hardship.

Debt

Peer-to-Peer Lending (P2P)

Borrowing and lending money directly between individuals through online platforms.

Debt

Penny Stock

A very low-priced share of a small company — highly speculative and easily manipulated.

Crypto & Markets

Pension

A retirement plan paying regular income after you stop working, funded during your career.

Investing

Perpetuity

A stream of equal payments continuing forever — a valuation concept in finance.

Investing

Personal Guarantee

A promise making you personally liable for a business loan if the business cannot pay.

Debt

Phishing

Fraudulent messages pretending to be banks or trusted companies to steal your login or card details.

Banking

Pink Sheets

An over-the-counter market for small, thinly traded, higher-risk stocks.

Crypto & Markets

Ponzi Scheme

A fraud where returns to earlier investors are paid from new investors' money, not real profit.

Crypto & Markets

Portfolio

Your complete collection of investments: stocks, bonds, funds, real estate, and more.

Investing

Portfolio Manager

The professional responsible for an investment fund's strategy and holdings.

Investing

Power of Attorney

A legal document authorizing someone to act on your behalf in financial or legal matters.

Budgeting

Preferred Stock

Shares with priority dividends over common stock but usually no voting rights.

Investing

Premium (Insurance)

The regular payment you make to keep an insurance policy active.

Budgeting

Prepayment Penalty

A fee some lenders charge if you pay off a loan early.

Debt

Present Value

What future money is worth today, given that money now can earn returns.

Investing

Price Discovery

The market process of buyers and sellers agreeing on an asset's fair price.

Crypto & Markets

Price-to-Book Ratio

Share price divided by book value per share — compares market price to net asset value.

Investing

Prime Rate

The interest rate banks charge their most creditworthy customers — a benchmark for other loans.

Banking

Principal

The original amount of money borrowed or invested, before interest.

Debt

Private Equity

Investment in companies not listed on public stock exchanges.

Investing

Private Placement

Selling securities directly to a small group of investors instead of the public.

Investing

Probate

The court process of validating a will and distributing a deceased person's estate.

Budgeting

Profit

What remains after all costs are subtracted from revenue.

Business

Profit and Loss Statement (P&L)

Another name for the income statement: revenue, costs, and profit over a period.

Business

Promissory Note

A written, signed promise to repay a specific sum under stated terms.

Debt

Prospectus

The legal document describing an investment offering's terms, risks, and finances.

Investing

Pump and Dump

A scam where fraudsters hype an asset to inflate its price, then sell, leaving others with losses.

Crypto & Markets

Purchasing Power

How much goods and services your money can actually buy; inflation erodes it.

Budgeting

Purchasing Power Parity (PPP)

Comparing currencies by what they can actually buy in each country.

Crypto & Markets

Q

Quantitative Easing (QE)

A central bank policy of buying bonds to inject money into the economy and lower long-term rates.

Crypto & Markets

Quantitative Tightening (QT)

A central bank reducing money supply by selling bonds — the reverse of QE.

Crypto & Markets

Quarterly Report

A company's financial statement published every three months.

Business

Quick Ratio

A liquidity test: liquid assets (excluding inventory) divided by current liabilities.

Business

Quote

The latest price at which an asset last traded, or the current bid and ask.

Crypto & Markets

R

Rally

A sustained period of rising asset prices after a decline or flat stretch.

Crypto & Markets

Rate of Return

The percentage gain or loss on an investment over a period.

Investing

Ratings Agency

A firm like Moody's or S&P that grades the creditworthiness of borrowers and bonds.

Crypto & Markets

Real Estate Crowdfunding

Pooling money online with other investors to fund property deals in small amounts.

Investing

Real Interest Rate

The interest rate after subtracting inflation — your true gain in purchasing power.

Banking

Rebalancing

Adjusting your portfolio periodically to maintain your target asset allocation.

Investing

Receivables Turnover

How quickly a business collects money owed by customers.

Business

Recession

A significant, widespread decline in economic activity, typically lasting months.

Crypto & Markets

Recurring Deposit

A savings product where you deposit a fixed amount monthly and earn interest on the growing balance.

Banking

Redemption

Cashing in an investment — selling fund shares back or receiving a bond's face value at maturity.

Investing

Refinancing

Replacing an existing loan with a new one, usually to get a lower interest rate.

Debt

Registered Investment Advisor (RIA)

A licensed professional firm that advises on investments for a fee, held to fiduciary standards.

Investing

REIT (Real Estate Investment Trust)

A company that owns income-producing real estate and trades like a stock, paying most profits as dividends.

Investing

Remittance

Money sent by workers abroad back to family in their home country.

Banking

Repo Rate

The rate at which a central bank lends short-term funds to commercial banks against securities.

Banking

Residual Income

Income left after all expenses and debt payments — or income continuing after the work is done.

Budgeting

Restricted Stock

Company shares granted to employees that can't be sold until vesting conditions are met.

Investing

Retained Earnings

Profits a company keeps to reinvest rather than paying out as dividends.

Business

Return on Equity (ROE)

Profit divided by shareholders' equity — how well a company uses owners' money.

Business

Revenue

Total money a business earns from sales before any costs are deducted.

Business

Reverse Mortgage

A loan letting older homeowners convert home equity into cash, repaid when the home is sold.

Debt

Revolving Credit

Credit you can borrow, repay, and re-borrow up to a limit — like credit cards.

Debt

Rights Issue

An offer letting existing shareholders buy new shares at a discount before outsiders.

Investing

Risk Premium

The extra return investors expect for taking on additional risk.

Investing

Risk Tolerance

How much investment loss you can emotionally and financially withstand.

Investing

ROI (Return on Investment)

The gain or loss on an investment relative to its cost, expressed as a percentage.

Investing

Rollover

Moving retirement funds from one account to another without triggering taxes.

Investing

Roth IRA

A US retirement account funded with after-tax money, with tax-free withdrawals in retirement.

Investing

Round-Trip Trade

Buying and selling the same asset within a short window.

Crypto & Markets

Rule of 72

A shortcut to estimate how long money takes to double: divide 72 by the annual return rate.

Investing

S

Safe-Haven Asset

An investment expected to hold value during turmoil — gold, top government bonds, some currencies.

Investing

Salary Advance

Receiving part of your earned wages before the official payday.

Budgeting

Savings Account

A bank account for storing money you don't need immediately, earning interest.

Banking

Secondary Market

Where investors trade existing securities among themselves — the stock exchange you know.

Crypto & Markets

Secured Credit Card

A card backed by a cash deposit you make, used to build or rebuild credit.

Debt

Secured Loan

A loan backed by collateral, like a mortgage or car loan.

Debt

Securities

Tradable financial instruments: stocks, bonds, and similar assets.

Investing

Securitization

Packaging loans (mortgages, car loans) into bonds sold to investors.

Investing

Seed Funding

The earliest round of capital a startup raises to develop its idea.

Business

Self-Employed Tax

Taxes independent workers pay covering both employee and employer contributions.

Budgeting

Sell-Off

A rapid, broad wave of selling that pushes market prices down sharply.

Crypto & Markets

Series A Funding

The first major venture round after seed, used to scale a proven product, grow the team, and build revenue — typically $5–15M.

Business

Series B Funding

A growth-stage round for startups with traction, used to expand into new markets, hire heavily, and refine operations — typically $15–50M.

Business

Series C Funding

A later-stage round for mature startups scaling aggressively or preparing for acquisition or IPO, often with large investors — typically $30M+.

Business

Share Buyback

A company repurchasing its own shares, reducing supply and often boosting the price.

Investing

Sharpe Ratio

Return earned per unit of risk taken — the classic risk-adjusted performance measure.

Investing

Short Position (Shorting)

Betting that an asset's price will fall by borrowing, selling, and buying back cheaper.

Crypto & Markets

Short Squeeze

When rising prices force short sellers to buy back shares, pushing prices even higher.

Crypto & Markets

Side Hustle

Work done alongside a main job to earn extra income.

Budgeting

Simple Interest

Interest calculated only on the original principal, not on accumulated interest.

Banking

Sinking Fund

Money set aside gradually for a known future expense — a wedding, new laptop, or annual insurance.

Budgeting

Smart Contract

Self-executing code on a blockchain that enforces an agreement without intermediaries.

Crypto & Markets

Soft Inquiry

A credit check that does not affect your score, like checking your own report.

Debt

Solvency

The ability to meet long-term financial obligations — the opposite of insolvency.

Business

Sovereign Debt

Bonds and loans issued by national governments.

Investing

Speculation

Trading on price movements rather than underlying value — high risk, high reward.

Crypto & Markets

Spread

The difference between the bid and ask price of an asset, or between borrowing and lending rates.

Crypto & Markets

Stablecoin

A cryptocurrency pegged to a stable asset like the US dollar to reduce volatility.

Crypto & Markets

Stagflation

The painful mix of stagnant growth, high unemployment, and high inflation.

Crypto & Markets

Staking

Locking up cryptocurrency to support a blockchain network in exchange for rewards.

Crypto & Markets

Standing Order

An instruction to your bank to pay a fixed amount regularly on set dates.

Banking

Stock (Share)

A unit of ownership in a company, entitling you to a slice of its profits and growth.

Investing

Stock Exchange

A regulated marketplace where shares are listed and traded, like the NGX or NYSE.

Crypto & Markets

Stock Split

Dividing existing shares into more shares at a lower price each — total value stays the same.

Investing

Stop-Loss Order

An order that automatically sells an asset if it falls to a set price, limiting your loss.

Crypto & Markets

Subprime Loan

Lending to borrowers with poor credit at higher interest rates — central to the 2008 crisis.

Debt

Subscription Economy

A business model where customers pay recurring fees for ongoing access rather than one-time purchases.

Business

Succession Planning

Preparing who takes over leadership or ownership of a business.

Business

Swap

A contract where two parties exchange cash flows — commonly interest-rate or currency swaps.

Crypto & Markets

Sweep Account

An account that automatically moves idle cash into higher-yield investments overnight.

Banking

SWIFT

The global messaging network banks use to send international payment instructions.

Banking

Systemic Risk

The danger that one failure cascades through the entire financial system.

Crypto & Markets

T

Take-Home Pay

Your salary after all deductions — the money that actually lands in your account.

Budgeting

Tangible Asset

A physical asset you can touch: buildings, machinery, inventory, cash.

Business

Tax Bracket

The range of income taxed at a specific rate — higher portions of income face higher rates.

Budgeting

Tax Credit

A direct reduction of the tax you owe — more valuable than a deduction of the same size.

Budgeting

Tax Deduction

An expense that reduces your taxable income, lowering the tax you owe.

Budgeting

Tax Haven

A jurisdiction with very low or zero taxes used by companies and individuals to shelter income.

Crypto & Markets

Tax-Deferred

Investments where taxes are postponed until you withdraw the money, like some retirement accounts.

Investing

Technical Analysis

Forecasting prices from charts and patterns rather than company fundamentals.

Crypto & Markets

Tenor (Term)

The length of time until a loan or bond matures.

Banking

Term Deposit

Money locked in a bank for a fixed period at a guaranteed interest rate.

Banking

Term Loan

A loan repaid over a fixed period with regular payments, like a car or business loan.

Debt

Third-Party Payment Processor

A company like Paystack or Stripe that handles card payments for businesses.

Business

Ticker Symbol

The short code identifying a listed stock or fund, like AAPL for Apple.

Crypto & Markets

Time Horizon

How long you plan to hold an investment before needing the money — it shapes your strategy.

Investing

Time Value of Money

The principle that money today is worth more than the same amount later, because it can earn returns.

Investing

Title Deed

The legal document proving ownership of property.

Business

Token

A digital asset built on an existing blockchain, representing value or utility.

Crypto & Markets

Total Expense Ratio

All costs of running a fund expressed as a percentage of its assets — lower is better.

Investing

Total Return

An investment's complete gain: price change plus dividends or interest.

Investing

Trade Deficit

When a country imports more than it exports.

Crypto & Markets

Trailing Stop

A stop-loss that moves up with the price, locking in gains as the asset rises.

Crypto & Markets

Transaction Fee

A charge for processing a payment, trade, or transfer.

Banking

Transfer Pricing

The prices set for transactions between branches of the same multinational company — heavily regulated.

Business

Treasury Bill (T-Bill)

A short-term government security sold at a discount and redeemed at full value — one of the safest investments.

Investing

Trial Balance

An accounting check that total debits equal total credits in the ledger.

Business

Trust (Legal)

An arrangement where a trustee holds and manages assets for beneficiaries.

Investing

U

Unbanked

People with no access to formal banking services at all.

Banking

Underbanked

People who have a bank account but still rely on informal services for credit or payments.

Banking

Undervalued

An asset trading below what its fundamentals suggest it's worth.

Crypto & Markets

Underwriting

The process lenders and insurers use to assess risk and set terms before approving you.

Banking

Unemployment Rate

The percentage of the labor force without work but actively seeking it.

Crypto & Markets

Unit Trust

A pooled fund divided into units investors can buy — the UK term for a mutual fund.

Investing

Unrealized Gain

A profit on an investment you still hold — it exists on paper until you sell.

Investing

Unsecured Debt

Borrowing with no collateral attached, so it carries higher interest rates.

Debt

Unsecured Loan

A loan not backed by collateral, like most personal loans and credit cards.

Debt

Upfront Costs

One-time expenses paid at the start of a purchase, like closing costs on a home.

Budgeting

Usury

Lending money at illegally or unethically high interest rates.

Debt

Utility Token

A crypto token granting access to a product or service on its platform.

Crypto & Markets

V

Valuation

The estimated worth of a company or asset.

Business

Value Investing

Buying quality assets priced below their true worth and holding until the market catches up.

Investing

Value Stock

Shares trading below their perceived true worth, often with solid dividends and steady earnings.

Investing

Variable Expenses

Costs that change month to month, like groceries, fuel, and entertainment.

Budgeting

Variable Rate

An interest rate that changes with market benchmarks over a loan's life.

Debt

Vendor Financing

When a seller lends the buyer the money to make the purchase.

Business

Venture Capital

Funding given to early-stage startups in exchange for equity, betting on high growth.

Business

Venture Debt

Loans to startups that complement equity funding without further diluting founders.

Business

Vesting

Earning full ownership of benefits like stock options gradually over time.

Business

Vesting Period

The time you must wait before gaining full ownership of granted benefits like stock options.

Business

VIX (Volatility Index)

The 'fear gauge' — a measure of expected stock-market volatility.

Crypto & Markets

Volatility

How much and how quickly an asset's price moves. High volatility means bigger swings in both directions.

Crypto & Markets

Volume

The number of shares or contracts traded in a period — a sign of market activity.

Crypto & Markets

Voluntary Liquidation

When a company's owners choose to wind it down and sell its assets.

Business

W

Wage Garnishment

Court-ordered deduction from your salary to repay a debt or obligation.

Debt

Waiver of Premium

An insurance feature that pauses your premiums if you become disabled or unable to work.

Budgeting

Wallet (Crypto)

Software or hardware that stores the keys used to access your cryptocurrency.

Crypto & Markets

Warrant

A company-issued right to buy its shares at a set price before an expiry date.

Investing

Wash Sale

Selling an investment at a loss and quickly rebuying it — often to harvest tax losses, restricted in many places.

Investing

Wealth Management

Professional services combining investing, tax planning, and estate planning for affluent clients.

Investing

Wealth Tax

A tax on the total value of a person's assets rather than their income.

Budgeting

Whale

An individual or entity holding enough of an asset to move its market price.

Crypto & Markets

Whitelisting

Pre-approving specific addresses or accounts as trusted for transactions.

Crypto & Markets

Windfall

A sudden, unexpected sum of money — an inheritance, bonus, or prize.

Budgeting

Wire Transfer

An electronic bank-to-bank transfer of funds, usually same-day and hard to reverse.

Banking

Withdrawal Penalty

A fee or lost interest for taking money out before an agreed date, like from a CD.

Banking

Withholding Tax

Tax deducted at the source of income — from salary, dividends, or interest — before you receive it.

Banking

Working Capital

Current assets minus current liabilities — the cash cushion a business runs on day to day.

Business

Working Capital Loan

Short-term business borrowing to cover everyday operating expenses.

Business

Write-Off

Removing an unrecoverable asset or debt from the books as a loss.

Business

Y

Year-over-Year (YoY)

Comparing a metric to the same period a year earlier to smooth out seasonal swings.

Business

Yield

The income an investment generates, usually shown as an annual percentage of its price.

Investing

Yield Curve

A graph of bond yields across maturities; an inverted curve often signals recession ahead.

Crypto & Markets

Yield Farming

Moving crypto between DeFi protocols to chase the highest returns.

Crypto & Markets

Yield Spread

The difference in yields between two bonds, reflecting their relative risk.

Investing

Z

Zero-Based Budgeting

A method where every unit of income is assigned a job until income minus expenses equals zero.

Budgeting

Zero-Coupon Bond

A bond sold at a deep discount that pays no interest, redeemable at full face value at maturity.

Investing

Zero-Sum Game

A situation where one party's gain is exactly another's loss — true of some derivatives trading.

Crypto & Markets

Zombie Company

A business earning just enough to service its debt but never to repay it.

Business

Heard a term on the show you don't understand? Browse episodes — we break them down as we go.