Money glossary

A workplace retirement savings plan that lets employees save part of each paycheck, often with an employer match; the 2026 limit is $24,500.

An electronic bank-to-bank payment sent through the Automated Clearing House network, used for payroll, bill pay and transfers.

A home loan with a rate that is fixed for a first period and then changes at set intervals based on a market index.

Your total income for the year minus certain adjustments, such as traditional IRA contributions or student loan interest.

If you earn a commission when people buy through your links, the FTC expects you to say so clearly near the link or recommendation.

Paying off a loan with regular equal payments that cover interest first and gradually reduce the principal to zero.

The amount you can give each person per year without filing a gift tax return; it is $19,000 per recipient for 2026.

The yearly cost of borrowing, including the interest rate and certain fees, shown as a percentage so loans can be compared.

The yearly rate a deposit account earns, including the effect of compounding, so you can compare savings accounts and CDs fairly.

A contract with an insurance company that turns money into a stream of payments, now or later, sometimes for life.

A person allowed to use someone else's credit card account who is not legally responsible for paying the debt.

A loan to buy a car that is secured by the vehicle, so the lender can repossess it if you do not pay.

Federal income tax a payer must withhold at 24% from some payments, for example when you do not give a correct taxpayer identification number.

Moving debt from one credit card to another, often to use a lower promotional rate, usually for a fee.

Goods or services you receive in exchange for your own goods or services are taxable income at their fair market value, like free products for a sponsored post.

A loan you make to a government or company that pays interest and returns the face value at maturity, if the issuer does not default.

A plan for how you will use your income each month, listing money coming in and money going out.

Costs of running a business that are ordinary and necessary for it can be subtracted from business income, lowering the profit that is taxed.

A short-term loan at checkout that splits a purchase into a few payments, often four payments over six weeks.

Tax on the profit from selling an asset such as stock, crypto or property; assets held over a year get lower rates.

A long-term rental of a vehicle for a set period and mileage limit, after which you return it or buy it.

Extra retirement savings allowed for people 50 and older above the normal limits; for 2026 it is $8,000 in a 401(k) and $1,100 in an IRA.

A savings deposit that pays a fixed rate if you leave the money in the bank for a set term, such as 6 months or 5 years.

When a lender writes off a debt as unlikely to be collected, usually after months of missed payments; you still owe it.

A bank or credit union account for everyday money: paychecks go in, and bills, card purchases and transfers come out.

A federal credit of up to $2,200 per qualifying child under 17 for 2026, with up to $1,700 of it refundable.

Fees and charges paid when a home loan is finalized, such as lender fees, appraisal, title insurance, recording fees and prepaid items.

A five-page form showing your final mortgage terms and closing costs, which you must receive at least three business days before closing.

A federal right to keep your employer's group health plan for a limited time after leaving a job or other events, usually at full cost.

Interest earned on both your original money and the interest it has already earned, so growth speeds up over time.

A mortgage that is not insured or guaranteed by a federal agency; many follow Fannie Mae and Freddie Mac rules.

The legal right of the creator of an original work, such as a video, song, photo or text, to control copying and use; it exists as soon as the work is fixed.

A person who signs a loan with the borrower and is fully responsible for repaying it if the borrower does not.

What you paid for an investment or property, plus certain costs, used to figure your gain or loss when you sell.

The yearly increase in Social Security and SSI payments to keep up with inflation; it was 2.8% for 2026.

A card that lets you borrow up to a set limit and pay later; unpaid balances are charged interest.

Your federal right to challenge a wrong charge on a credit card statement, in writing, within 60 days of the statement.

A free lock on your credit report that stops most new lenders from seeing it, which makes it harder to open accounts in your name.

A record of your credit accounts and payment history kept by credit reporting companies and used to calculate credit scores.

A three-digit number, usually from 300 to 850, that estimates how likely you are to repay borrowed money on time.

A not-for-profit financial cooperative owned by its members that offers accounts, loans and cards, often with lower fees.

The share of your available credit card limits that you are using, a major factor in most credit scores.

A card linked to your checking account that takes money directly from your balance when you pay or withdraw cash.

A person or company that collects debts owed to someone else; federal law limits how and when they can contact you.

Combining several debts into one new loan or card, ideally with a lower rate or a single payment that is easier to manage.

Your monthly debt payments divided by your gross monthly income, used by lenders to judge whether you can afford a new loan.

The amount you pay for covered services or a claim before your insurance starts to pay.

Increases to your Social Security retirement benefit for each month you wait past full retirement age, up to age 70.

A qualifying child or relative you support who can be claimed on your tax return, which can open credits and a better filing status.

Spreading the cost of business property, such as equipment, vehicles or buildings, over several years as a tax deduction.

An electronic payment that sends money such as your paycheck, tax refund or benefits straight into your bank account.

Fees paid at closing to lower a mortgage interest rate; one point equals 1% of the loan amount.

Spreading money across different investments so a loss in one is less likely to hurt the whole portfolio.

A payment a company or fund makes to shareholders, usually in cash, from its profits or income.

The part of a home or car price you pay up front in cash; the rest is usually financed with a loan.

A 10% additional tax on most retirement account withdrawals taken before age 59 1/2, on top of regular income tax.

A refundable federal credit for workers with low to moderate income; for 2026 the maximum is $8,231 for families with three or more children.

Money set aside for unexpected costs such as a car repair, medical bill or job loss, kept somewhere easy to reach.

A nine-digit number the IRS assigns to businesses and other entities for tax filing, free of charge.

Money an employer adds to your workplace retirement account based on how much you contribute.

Under FTC guidance, influencers must clearly disclose when a brand pays them, gives them free products or has another connection, in the post or video itself.

A federal law that bans credit discrimination based on race, color, religion, national origin, sex, marital status, age and public assistance income.

An account your mortgage servicer uses to collect part of each payment and pay your property taxes and homeowners insurance.

A federal tax on the transfer of a person's property at death, owed only on estates above the basic exclusion of $15,000,000 for 2026.

Quarterly tax payments people make on income that has no withholding, such as self-employment, rental or investment income.

The price of one currency in another, such as how many Mexican pesos or Philippine pesos one U.S. dollar buys.

A fund that holds a basket of investments, like a mutual fund, but trades on an exchange throughout the day like a stock.

A U.S. legal doctrine that allows limited use of copyrighted material without permission in some cases, such as commentary, criticism or teaching.

A yearly report, FinCEN Form 114, required when U.S. persons have foreign accounts totaling more than $10,000 at any time during the year.

Federal protection for deposits at insured banks, standard coverage of $250,000 per depositor, per bank, per ownership category.

Loans for college or career school from the U.S. Department of Education, with fixed rates and protections private loans may not have.

A mortgage insured by the Federal Housing Administration that allows lower down payments and credit scores than many other loans.

Payroll taxes for Social Security and Medicare: employees pay 7.65% of wages and employers match it.

The category you file your tax return under, such as single or married filing jointly, which sets your brackets and standard deduction.

A home loan whose interest rate, and principal-and-interest payment, stay the same for the whole term, usually 15 or 30 years.

An employer account where you set aside pre-tax pay for medical or dependent care costs; the 2026 health FSA limit is $3,400.

The legal process a lender uses to take and sell a home after the borrower falls far behind on mortgage payments.

The main U.S. individual income tax return that most residents file each year to report income, deductions, credits and tax.

The IRS form a U.S. payer sends to a foreign person showing U.S.-source income paid and any U.S. tax withheld during the year.

A form that reports payments you received through card processors and payment apps or online marketplaces for goods and services.

The form a business uses to report payments to independent contractors; for payments made in 2026 the threshold is generally $2,000.

The yearly wage and tax statement your employer sends you and the government, showing pay and taxes withheld.

The IRS form you give your employer to tell them how much federal income tax to withhold from your pay.

The IRS form a person who is not a U.S. citizen or resident gives to a U.S. payer to confirm foreign status and, where a tax treaty allows, claim a lower withholding rate.

The IRS form a U.S. person gives to a business that pays them, so it has their correct taxpayer identification number for reporting the payments.

The age at which you can get your full Social Security retirement benefit; it is 67 for anyone born in 1960 or later.

A federal tax employers pay, not employees, of 6.0% on the first $7,000 of each worker's wages, usually reduced to 0.6% by a state credit.

Work done for money through apps and websites, such as ride-sharing, delivery, freelancing or selling online; the income is taxable even without a tax form.

The time between the end of a billing cycle and the due date when you can pay the full balance without interest on purchases.

A check of your credit report that happens when you apply for new credit; it can lower your score slightly for a short time.

A tax-advantaged account for medical costs, available with a qualifying high-deductible health plan; 2026 limits are $4,400 self-only and $8,750 family.

Money from an activity you do mainly for fun rather than to make a profit; it must still be reported, but a hobby loss cannot reduce other income.

The part of your home's value that you own outright: its market value minus what you still owe on it.

A revolving line of credit secured by your home, which you can draw on as needed up to a limit, usually at a variable rate.

Self-employed people may deduct part of their home costs if they use part of the home regularly and only for business, or $5 per square foot up to 300 square feet.

A policy that covers damage to your home and belongings and your liability to others, subject to limits and exclusions.

A U.S. savings bond whose rate combines a fixed rate and an inflation rate that resets every six months; the limit is $10,000 a year in electronic bonds.

When someone uses your personal information, such as your name or Social Security number, to open accounts, file taxes or get benefits.

Frauds where someone pretends to be a government agency, a business, a relative or a romantic interest to get your money or information.

Federal student loan plans that set your monthly payment based on your income and family size, with any remaining balance forgiven after many years.

A self-employed worker who controls how a job is done and is paid without tax withholding, unlike an employee.

A mutual fund or ETF that tries to match the performance of a market index by holding the same investments.

The general rise in prices over time, which means each dollar buys a little less than before.

The percentage a lender charges you each year for borrowing money, or a bank pays you for keeping money on deposit.

An extra charge added to Medicare Part B and Part D premiums for people with higher incomes, based on their tax return from two years earlier.

Specific expenses you can list on Schedule A, such as mortgage interest, state and local taxes and charity, instead of taking the standard deduction.

A nine-digit tax number from the IRS for people who must file or be listed on a U.S. tax return but cannot get a Social Security number.

A business structure formed under state law that can protect owners' personal assets from business debts, with flexible tax treatment.

A standard three-page form a mortgage lender must give you within three business days of your application, showing the loan's key terms and costs.

The tax rate on your next dollar of income, which is the rate of the highest bracket your taxable income reaches.

A health coverage program for people with limited income, run by each state with federal funding and rules.

Federal health insurance for people 65 and older, and for some younger people with disabilities or certain conditions.

The monthly amount most people pay for Medicare medical insurance; the standard premium for 2026 is $202.90.

The smallest amount you must pay on a credit card by the due date to avoid a late fee and keep the account in good standing.

The lowest hourly pay allowed by law; the federal minimum is $7.25, and many states and cities set higher rates.

A prepaid paper payment you buy with cash or a debit card, used like a check when you do not have a checking account.

A fund that pools money from many investors to buy a mix of stocks, bonds or other assets, managed by a professional firm.

Paid content made to look like the articles, videos or posts around it; the FTC says it must be identifiable as an ad.

What you own minus what you owe: your assets, such as savings, a home and retirement accounts, less your debts.

For U.S. tax, a person who is not a U.S. citizen and does not meet the green card test or the substantial presence test; taxed only on U.S.-source income.

The most you will pay for covered in-network health care in a plan year; after that, the plan pays 100% of covered costs.

A fee a bank charges when it pays a transaction even though your account does not have enough money to cover it.

Extra pay of at least one and a half times the regular rate for hours over 40 in a workweek, required for many workers by federal law.

A small, short-term, high-cost loan that is usually due on your next payday, often with fees equal to an APR near 400%.

Taxes an employer withholds from wages and pays itself, including Social Security, Medicare, federal unemployment and state taxes.

A retirement plan that pays a set monthly income for life, based on a formula using your pay and years of service.

An installment loan, usually unsecured, that you repay in fixed monthly payments over a set term, often two to seven years.

The amount you pay, usually monthly, to keep an insurance policy active, whether or not you use it.

A refundable federal tax credit that lowers the monthly cost of health insurance bought through the Health Insurance Marketplace.

A card you load with money in advance and then use to pay; it is not a credit card and does not build credit.

The amount you borrowed, or the part of a loan balance that is still unpaid, not counting interest.

Insurance that protects the lender, not you, and is usually required on a conventional loan when you put down less than 20%.

A yearly tax set by local governments, mainly on homes and land, based on the property's assessed value.

A federal deduction that lets many owners of sole proprietorships and pass-through businesses deduct up to 20% of their qualified business income.

A deduction of up to $25,000 a year for 2025 through 2028 for tips earned in jobs where tipping is customary.

Replacing an existing loan with a new one, usually to get a lower rate, change the term, or take cash out of home equity.

Money sent electronically from someone in the U.S. to a person or business in another country, through a bank, credit union or money transfer company.

A 1% federal tax, starting with transfers after December 31, 2025, on international money transfers paid for with cash, money orders or similar instruments.

The minimum amount you must withdraw each year from most retirement accounts once you reach a certain age, currently 73.

A federal right to cancel certain loans secured by your main home, such as a refinance with a new lender or a HELOC, within three business days.

Moving money from a traditional IRA or pre-tax plan into a Roth account and paying income tax on the amount now.

An individual retirement account funded with after-tax money, where qualified withdrawals, including growth, are tax-free.

A nine-digit code that identifies your bank or credit union for direct deposits, electronic transfers and checks.

Payments for the use of your property, such as music, books or videos you hold the rights to; where it goes on your return depends on whether you are in business.

The itemized deduction for state and local taxes, such as income or sales tax and property tax, which is capped at $40,400 for 2026.

A deposit account for money you plan to keep, which pays interest and usually allows fewer withdrawals than a checking account.

The form attached to Form 1040 where sole proprietors, freelancers and many creators report business income and expenses to find their profit or loss.

A tax rule that lets a business deduct the cost of qualifying equipment in the year it is placed in service instead of spreading it over several years.

A credit card backed by a cash deposit you pay up front, often used to build credit from scratch or rebuild it.

Social Security and Medicare tax paid by people who work for themselves, at 15.3% on most net earnings.

Units you earn by working and paying Social Security tax; most people need 40 credits, about 10 years of work, to get retirement benefits.

A nine-digit number from the Social Security Administration used to track earnings for benefits and to identify people for taxes.

The simplest business form: one person owns the business, with no separate legal entity, and reports profit on their own tax return.

A fixed dollar amount you can subtract from income instead of listing individual deductions; for 2026 it is $16,100 for single filers.

An IRS rate per mile used to deduct the cost of driving a personal car for business; it was 72.5 cents through June 2026 and 76 cents from July 1, 2026.

A share of ownership in a company; its price rises and falls with the company's prospects and the market.

A monthly federal payment for people with very limited income and resources who are 65 or older, blind or disabled.

A range of taxable income that is taxed at one rate; the U.S. has seven federal brackets, from 10% to 37%.

An amount subtracted directly from the tax you owe; a refundable credit can also be paid to you if it is larger than your tax.

Extra time to file your federal return, usually to October 15, granted with Form 4868; it does not give extra time to pay.

Money the IRS or your state sends back when you paid more tax during the year than you owed, or have refundable credits.

An agreement between the U.S. and another country that can lower or remove U.S. tax on some income of residents of that country.

The part of your income that federal income tax is actually figured on: AGI minus your standard or itemized deductions.

Life insurance that pays a set amount to your beneficiaries if you die during a fixed period, such as 20 or 30 years.

An individual retirement account where contributions may be tax-deductible and growth is tax-deferred until you withdraw; the 2026 limit is $7,500.

Debt issued by the U.S. government, such as bills, notes, bonds and TIPS, backed by the full faith and credit of the United States.

Federal limits on how much you lose when someone uses your debit card or account without permission, based on how fast you report it.

A home loan for eligible veterans, service members and some surviving spouses, guaranteed by the Department of Veterans Affairs.

A fast electronic transfer of money between banks, often used for large or urgent payments such as a home closing.

Tax your employer takes out of each paycheck and sends to the government on your behalf.