Vocabulary

• Freelancer – A person who works independently, often within a specific industry or skill set, rather than for a company or employer.
• Budget – An estimation of income and expenditure for a set period of time.
• Income – The financial gain accrued in exchange for work or through investing.
• Expense – The cost required for something; the money spent on something.
• Financial Planning – The process of defining financial goals and creating a strategy for achieving them.
• Savings – The portion of income not spent but set aside for future use.
• Investments – Assets or items purchased with the hope that it will generate income or appreciate in the future.
• Tax – A mandatory financial charge or levy imposed by a government on a taxpayer to fund public expenditures.
• Invoice – A document issued by a seller to a buyer that specifies the amount and cost of products or services provided.
• Cash Flow – The total amount of money moving in and out of a business.
• Liability – A company's financial debt or obligations that arise during the course of its operations.
• Assets – Resources owned by an individual or a company that has economic value.
• Debt – Money that is owed or due.
• Interest – The charge for the privilege of borrowing money, typically expressed as an annual percentage rate.
• Retirement Plan – A financial plan that provides income during retirement.
• Emergency Fund – A savings account set aside for unforeseen expenses.
• Profit – The financial gain achieved when the amount earned from a business activity exceeds the expenses, costs, and taxes.
• Loss – The amount of money lost by a business or individual.
• Insurance – A contract in which an individual or entity receives financial protection or reimbursement against losses.
• Financial Independence – The status of having enough income to pay for living expenses without having to work full time.
• Pension – A regular payment made by the state or a private company to a person who has retired.
• Diversification – The process of allocating investments among various financial instruments or industries to reduce risk.
• Equity – The value of an asset after all liabilities and debts have been paid.
• Capital – Wealth in the form of money or assets, used in a business by a person, partnership, or corporation.
• Revenue – The income generated from normal business operations and includes discounts and deductions for returned merchandise.
• Overhead – The ongoing business expenses not directly attributable to creating a product or service.
• Budget Deficit – A status of financial health in which expenditures exceed revenue.
• Fixed Costs – Costs that do not change with the level of output.
• Variable Costs – Costs that vary depending on a company's production volume.
• Net Worth – The total assets minus total outside liabilities of an individual or a company.
• Gross Profit – The profit a company makes after deducting the costs associated with making and selling its products.
• Net Income – A company's total earnings, also known as the bottom line.
• Earnings – The amount of profit that a company produces during a specific period.
• Dividends – A distribution of a portion of a company's earnings to a class of its shareholders.
• Capital Gains – The increase in value of an investment or real estate that gives it a higher worth than the purchase price.
• Broker – An individual or firm that acts as an intermediary between an investor and a securities exchange.
• Bonds – A fixed income instrument that represents a loan made by an investor to a borrower.
• Stocks – A share in the ownership of a company and constitutes a claim on part of the company’s assets and earnings.
• Mutual Funds – An investment vehicle made up of a pool of funds collected from many investors for the purpose of investing in securities.
• Exchange-Traded Funds (ETFs) – An investment fund traded on stock exchanges, much like stocks.
• Portfolio – A range of investments held by a person or organization.
• Risk Tolerance – The degree of variability in investment returns that an investor is willing to withstand.
• Leverage – The use of borrowed money to increase the potential return of an investment.
• Liquidity – The degree to which an asset or security can be quickly bought or sold in the market without affecting the asset's price.
• Hedge – An investment to reduce the risk of adverse price movements in an asset.
• Financial Advisor – A professional who provides financial services to clients based on their financial situation.
• Loan – A sum of money that is expected to be paid back with interest.
• Credit Score – A number assigned to a person that indicates to lenders their capacity to repay a loan.
• Bankruptcy – A legal process involving a person or business that is unable to repay their outstanding debts.
• Fiscal Year – Any yearly period without regard to the calendar year, at the end of which a firm, government, etc., determines its financial condition.