top of page
Learn
The Tale
of Centy
The Starter
Glossary
Let's break down some of those financial terms!
#
A
B
C
D
E
F
G
H
I
J
K
L
M
N
O
P
Q
R
S
T
U
V
W
X
Y
Z
$100k by 30
A personal finance goal with the aim to save or invest $100,000 by the time they turn 30
4% Rule
A guideline to spend 4% of your total savings per year after retirement, so you don't run out of money too quickly
50/30/20 Rule
A budgeting rule where 50% of your income goes to needs (rent, food, etc.), 30% to wants (entertainment), & 20% to savings or debt payments
Appreciation
When something you own, like a house or stock, increases in value over time
Anything valuable you own (a house, car, or investments), which can help you make more money in the future
Asset
Asset Allocation
How you split money among things like stocks, bonds, & savings to balance risks
Basic Retirement Sum (BRS)
In Singapore, it's the minimum amount of money you need to save in your CPF by 55 for basic retirement needs
When prices in the stock market drop for a long time, making people more cautious about investing
Bear Market
Bitcoin
A type of digital money that exists only online & isn't controlled by any government
Blue Chip Stocks
Stocks from large, well-known companies that are considered safe & stable investments
A way to lend money to companies or governments. They pay you interest for a set time, & then you get your money back
Bonds
Brokerage Account
An account you open to buy & sell things like stocks & bonds
Capital
The money you invest or use to start a business
The money coming in & going out of your finances, like income from work & expenses like bills
Cash Flow
CPF Account Types
-
Ordinary Account (OA) – Used for housing, education, & insurance
-
Special Account (SA) – Set aside for retirement savings
-
Medisave Account (MA) – Used for healthcare expenses
The money you & your employer put into your CPF account every month
CPF Contributions
CPF Investment Schemes (CPFIS)
Ways to invest your CPF savings (Ordinary Account + Special Account) in stocks & funds to grow your retirement money
Credit Card
Borrow money to make purchases that you need to pay back, usually with interest if you don't pay the full amount
A number that shows how reliable you are at paying back borrowed money. Higher score = more trustworthy to lenders
Credit Score
Compound Interest
Interest you earn on both money you saved & the interest that has already been added, helping your money grow faster
Debt
Money you owe to someone else, like a loan or credit card balance
Dependent Protection Scheme (DPS)
A life insurance scheme in Singapore that helps provide money for your family if you pass away or get seriously ill
Depreciation
When something you own, like a car, loses value over time
Diversification
Spreading your money across different types of investments to reduce risk
A portion of a company’s profits that it gives to people who own its stock
Dividends
Dollar Cost Averaging
Investing a fixed amount of money regularly, no matter what the market is doing, to avoid trying to time the market
Equity
The value of what you own in something, like the amount of a house you own after subtracting the loan
Emergency Fund
About 3-6 months worth of living expenses set aside for unexpected expenses, like a medical bill or car repair
Exchange Traded Fund (ETF)
A group of stocks or bonds that you can buy and sell like a single stock
Expense Ratio
A fee that funds charge you for managing your money
Fees
Charges you pay for things like managing investments or using financial services
Financial Independence
When you have enough money saved or invested that you no longer need to work to cover your living expenses
Fixed Deposit Account
A savings account where you agree to leave your money for a certain period and earn a higher interest rate in return
Fixed Income
Money you receive regularly from investments, like interest from bonds
Full Retirement Sum (FRS)
This is the amount of money you need to set aside in your CPF at 55 to ensure a higher monthly payout when you retire
Goal Based Investing
Investing with specific goals in mind, like saving for a house or retirement
The total money you earn before any deductions like taxes are taken out
Gross Income
Growth Stocks
Stocks from companies that are expected to grow quickly, increasing their value & your potential profits
HDB Loan
A loan provided by HDB to help you buy a home, often with lower interest rates than a bank loan
Hedge
Protecting your money from losing value, often by investing in something that does well when other investments go down
High-Yield Savings Account
A savings account that offers a higher interest rate than regular ones, helping your money grow faster
Index
A measure that tracks how a group of stocks or other investments are performing
Inflation
When prices rise over time, reducing the value of money. This means your money doesn’t buy as much as it used to
Intangible Assets
Things you own that aren’t physical, like a brand or patents
Interest
Money you earn from savings or investments, or money you pay when you borrow
Using your money to buy things like stocks, bonds, or property to make more money over time
Investing
Investment-Linked Policy
A life insurance policy that combines life insurance with investments. Part of the premium is invested, & returns depend on market performance
Kappa
A measure of the risk of an investment compared to the overall market
Joint Account
A bank account shared by two or more people, usually for shared expenses or savings
Junk Bonds
Bonds from companies that are high risk but could give high returns
Liability
Something you owe, like debt or loans, which takes money away from you
Lifestyle Inflation
Spending more money as you earn more, which can make it harder to save for the future
Liquidity
How quickly & easily you can turn an asset, like a house or stock, into cash
Loan
Money you borrow that you must pay back, usually with interest
Market
Where buyers & sellers trade assets like stocks or real estate
Medisave
A savings scheme in Singapore where you set aside money for future medical expenses
Minimalism
A lifestyle focused on having & spending less to save more money
Mortgage
A loan to buy a house, where the house itself is used as security for the loan
A pool of money from many people that’s invested in stocks, bonds, or other assets by a professional manager
Mutual Fund
Opportunity Cost
The value of what you give up when you choose one option over another
Options
A type of investment that gives you the right, but not the obligation, to buy or sell something at a specific price in the future
Nest Egg
Money saved for the future, especially for retirement
Net Worth
The total value of everything you own (assets) minus what you owe (liabilities)
Nominal Interest Rate
The interest rate on a loan or investment before considering inflation
Passive Income
Money you earn regularly without actively working for it, like rent or dividends
Portfolio
All the different things you invest in, like stocks, bonds, or property
Principal
The original amount of money you invest or borrow, not including interest or profits
Quantitative Analysis
Using numbers & data to understand or predict financial trends
Quota
A set limit or goal for something, like sales or production, within a specific time frame
Rebalancing
Adjusting your investments so they match your financial goals & risk tolerance over time
Retirement Account
An account where you save & invest money for when you stop working
Return on Investment
The profit you make on an investment compared to how much you put in
Risk Tolerance
How comfortable you are with losing money in the short term to potentially make more money in the long term
Roboadvisor
An automated service that helps you manage your investments online, often for a lower fee than a human advisor
Savings Rate
The percentage of your income that you save, rather than spend
Security
A financial asset, like stocks or bonds, that can be traded
Shareholder
Someone who owns shares (stocks) in a company & has a part of its profits
Stock
A share of ownership in a company. If the company does well, your stock value goes up
Target Date Fund
An investment fund that automatically adjusts its risk level as you get closer to a specific target date, like retirement
Taxes
Money you have to pay to the government based on what you earn, spend, or own
Treasury Bond
Low-risk investment issued by the Singapore government that pays you interest over time
Underwater
When you owe more on something, like a house, than it's currently worth
Unrealised Gains
The profit you have on paper from investments that have increased in value but haven't been sold yet
Value Investing
Buying investments that seem undervalued, with the expectation they’ll rise in price later
Volatility
How much the price of an investment moves up or down. High volatility means bigger, more unpredictable changes
Wealth
The total value of everything you own, minus what you owe
Will
A legal document that says who gets your money and possessions when you die
Withdrawal
Taking money out of a savings or investment account
Year-to-Date
How much something has grown or earned since the start of the year
Yield
The amount of money you earn from an investment, usually as a percentage of its value
Zero-Sum Game
A situation where one person’s gain is equal to another’s loss
XIRR
A method to calculate the return of investments over time, especially with deposits & withdrawals at different dates
bottom of page