Managing My Money Glossary

AER or Annual Equivalent Rate is the rate of interest on savings products calculated to take into account different payment patterns.

APR or Annual Percentage Rate is a summary figure for comparing debt costs which bring together interest rates and other charges.

A type of investment where the investor pays a lump sum and in return receives an income paid either for a set period or, as in the case of most pensions, for the rest of their life. Once the investment is made, they cannot change their mind or get back their lump sum.

Everything that a person owns that has a monetary value (e.g. property, investments or cash).

A process that happens when an individual cannot pay their debts, and all their property is distributed to the people to whom they own money.

A certificate of debt that is issued by a government or corporation in order to raise money.

A temporary loan to extend further funds during the selling of one property, when the seller has already acquired another.

A broker is a person or firm that helps to arrange the sale of products from one party (the product provider) to another (the product buyer). The broker will normally charge a fee to the buyer of the product for this service.

A detailed plan of income and expenditure over a certain period of time - typically a year.

The process by which interest payments are added to the original amount borrowed to give a higher total figure which, in turn, attracts interest rate changes.