Term Of The Day (Investment Related)

Credit Limit
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- q/ k  I0 q( ^* f: o/ {, ~The amount of credit that a financial institution extends to
a client. Credit limit also refers to the maximum amount a
9 L. J6 ~  c+ p5 ]) d0 [$ u) ]credit card company will allow someone to borrow on a single
0 o, e1 S' @# {/ kcard. Credit limits are usually determined based on information
! e8 y; _$ d4 o# X7 x; _, [contained in the application of the person seeking credit, or
that person's credit rating.

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" \! }+ n5 f# W* \2 ~" @A debt instrument that is secured by the collateral of
+ Y: D4 r4 n/ V3 B9 Jspecified real estate property and that the borrower is obliged
0 G( V* S! l6 ?+ Kto pay back with a predetermined set of payments. Mortgages
are used by individuals and businesses to make large purchases
of real estate without paying the entire value of the purchase
7 S3 l. p+ ~- K$ P8 y! I$ cup front.
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Mortgages are also known as "liens against property" or "claims
on property".

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1. A contractual agreement in which a borrower receives
something of value now and agrees to repay the lender at some
date in the future, generally with interest. The term also
refers to the borrowing capacity of an individual or company.
+ W+ h  J4 ]& m$ Y4 T
+ O0 M# @' f! u9 ?  H- c2. An accounting entry that either decreases assets or increases
5 G% y7 T! S! Zliabilities and equity on the company's balance sheet. On the
company's income statement, a debit will reduce net income,
while a credit will increase net income.

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  q4 m3 `0 l! mThe one-year period that begins on January 1 and ends on
  y' t  y; k: k' HDecember 31, based on the commonly used Gregorian calendar.
For individual and corporate taxation purposes, a calendar
year will generally comprise all of the year's financial
information used to calculate income tax payable.

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An estimation of the revenue and expenses over a specified
future period of time. A budget can be made for a person, family,
* J" X- n! b6 H: Dgroup of people, business, government, country,  multinational
$ O; N9 ^* N; G' P5 D! e1 ]organization or just about anything else that makes and spends
( {) V/ U. i! Smoney. A budget is a  microeconomic concept that shows the
1 B9 k$ C9 p7 ~4 ]5 H0 Itradeoff made when one good is exchanged for another.

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An investor who is willing to take on additional risk for an
8 X. ^! w: j& X* X, A* z! Pinvestment that has a relatively low expected return. This
contrasts with the typical investor mentality - risk aversion.
Risk averse investors tend to take on increased risks only if
they are warranted by the potential for higher returns.

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A situation in which the supply and demand for a good or
service can vary significantly due to the price. The elasticity
of a good or service can vary according to the amount of close
substitutes, its relative cost and the amount of time that has
elapsed since the price change occurred.

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A working-class person historically defined by hourly rates
* @5 w3 Z8 Q+ l5 \0 jof pay and manual labor. A blue collar worker refers to the
. ]" Y5 i- ~; p* |: W  ^fact that most manual laborers at the turn of the century wore
blue shirts, which could hold a little dirt around the collar
( D* v4 Z" N( z  K2 I8 U9 Dwithout standing out.
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- F$ R1 B! e+ E7 HThis working class stands in contrast to white collar workers,
which historically have had the higher-paying, salaried positions
8 k% j" K9 n, V/ |! gto go with their clean and pressed white shirts.

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A phrase commonly used in personal finance and retirement
! w+ z# E6 t5 yplanning literature that means to automatically route your
specified savings contribution from each paycheck at the time
it is received.
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Because the savings contributions are automatically routed
7 {" V. R" ^9 a; `, s: D) hfrom each paycheck to your investment account, this process
( J+ @5 G- H9 E7 V, F( w! qis said to be "paying yourself first", or before you begin
& E- j% Y  s- M$ cpaying your monthly living expenses and making discretionary
purchases.

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8 M' _+ v. E# e2 c3 X. d6 jThe income of an individual or group after taking into
consideration the effects of inflation on purchasing power.
For example, if you received a 2% salary rise over the previous
3 \  g/ P. J  d6 Myear and inflation for the year was 1%, then your real income
only rose 1%. Conversely, if you received a 2% raise in salary
and inflation stood at 3%, then your real income would have
shrunk 1%.