Essential concepts with a definition, example and source. Figures are illustrative, not current market rates or data.
Concepts found: 6
Principal
In our calculators, it is the starting amount: money initially saved or the amount borrowed. Capital can have other meanings in accounting and business finance.
See example ↗CONCEPTInflation
A broad and sustained increase in the price level. It is not the rise of one product alone, and changes in a reference basket may differ from changes in your own expenses.
See example ↗CONCEPTCompound interest
Interest calculated on principal and on interest already accumulated. The compounding period determines when interest is added to the balance.
See example ↗CONCEPTLiquidity
Describes how easily an asset can be turned into available money without materially affecting its value. Owning assets and having cash available are different things.
See example ↗CONCEPTReturn
Relates an investment gain or loss to the amount invested over a defined period. Comparing returns requires identifying the period and whether income, costs and taxes are included.
See example ↗CONCEPTEffective annual rate
Expresses interest over one year including the compounding of intermediate periods. Equivalent monthly and annual effective rates describe the same growth over comparable terms.
See example ↗