Master over 50 financial terms related to taxes, loans, investments, insurance, and retirement planning, tailored for the Indian market to boost your financial literacy.
Explore TermsThe process of gradually paying off a loan through regular payments over a set period, covering both principal and interest, common in home and car loans in India.
The strategy of dividing investments among different asset classes (e.g., equities, bonds, fixed deposits) to balance risk and return based on financial goals.
The annualized cost of borrowing, including interest and fees, expressed as a percentage, used in loan agreements in India.
Debt instruments issued by governments or corporations to raise funds, offering periodic interest and principal repayment, e.g., Government of India Savings Bonds.
A financial plan outlining expected income and expenses over a period, used by individuals and businesses in India for financial management.
Tax on profits from selling assets like stocks or property, categorized as Short-Term (STCG) or Long-Term (LCGT) in India based on holding period.
Interest calculated on the initial principal and accumulated interest, used in savings accounts, fixed deposits, and mutual funds in India.
A numerical score (e.g., CIBIL score in India) reflecting creditworthiness, based on credit history, used by lenders to assess loan eligibility.
An asset pledged to secure a loan, such as property or gold, which the lender can seize if the borrower defaults.
A digital account for holding and trading securities like shares and mutual funds in electronic form, mandatory for stock market investments in India.
A portion of a company’s profits distributed to shareholders, often taxed under Indian income tax laws depending on the amount.
A ratio comparing monthly debt payments to income, used by lenders in India to assess loan affordability.
A fixed monthly payment to repay a loan, including principal and interest, common for home, car, and personal loans in India.
A tax-saving mutual fund scheme in India with a 3-year lock-in period, eligible for deductions under Section 80C.
Ownership in a company through shares, representing a claim on its assets and profits, traded on stock exchanges like NSE or BSE.
A low-risk investment offered by banks and NBFCs in India, providing a fixed interest rate for a specified term.
The process of setting financial goals and creating a plan to achieve them, including budgeting, saving, and investing.
The process of repaying a loan in full before its term ends, often incurring prepayment penalties in India.
A unified indirect tax on goods and services in India, replacing multiple taxes like VAT and service tax.
A secured loan where gold is pledged as collateral, offered by banks and NBFCs in India with relatively low interest rates.
A legal entity under Indian tax law allowing families to file taxes jointly, eligible for deductions and exemptions.
A loan taken to purchase or construct a residential property, often with tax benefits under Section 24 and 80C in India.
A direct tax levied by the Government of India on individuals and businesses, governed by the Income Tax Act, 1961.
The rate at which prices for goods and services increase, reducing purchasing power, tracked in India via CPI and WPI.
The cost of borrowing or the return on savings, expressed as a percentage, e.g., loan rates or FD returns in India.
The ease of converting an asset into cash without affecting its value, e.g., savings accounts have high liquidity.
The ratio of a loan amount to the appraised value of the asset, used in home and auto loans in India.
A pooled investment vehicle managed by professionals, investing in stocks, bonds, or other assets in India.
The borrower’s contribution to a loan, reducing the lender’s risk, common in home and education loans in India.
The total value of assets (e.g., property, savings) minus liabilities (e.g., loans), reflecting financial health.
A government-backed pension scheme in India, offering tax benefits and market-linked returns for retirement planning.
The per-unit value of a mutual fund, calculated as total assets minus liabilities divided by the number of units.
A government-backed savings scheme in India, offering tax-free interest and deductions under Section 80C.
A collection of investments, such as stocks, bonds, and mutual funds, held by an individual or entity.
The original amount borrowed or invested, on which interest is calculated, e.g., loan amount or FD deposit.
A measure of investment profitability, calculated as the gain or loss relative to the investment cost, expressed as a percentage.
A savings scheme where fixed amounts are deposited monthly for a specified period, earning interest, offered by banks in India.
The degree of risk an investor is willing to endure, influencing investment choices like equity or fixed-income securities.
A method of investing a fixed amount regularly in mutual funds, benefiting from rupee cost averaging and compounding.
A government-issued bond in India backed by gold, offering interest and capital appreciation based on gold prices.
A provision under the Income Tax Act, 1961, allowing deductions up to ₹1.5 lakh for investments like PPF, ELSS, and insurance premiums.
A marketplace where shares of companies are bought and sold, e.g., NSE and BSE in India.
Tax deducted at the source of income (e.g., salary, interest) as per Indian tax laws to reduce tax evasion.
A life insurance policy providing coverage for a specific period, offering high coverage at low premiums in India.
Income tax rates applied to different income levels in India, varying by old and new tax regimes.
A product combining life insurance and investment, with premiums invested in market-linked funds, offering potential returns.
The degree of price fluctuations in an investment, e.g., stocks or mutual funds, indicating higher risk.
The process of building financial assets over time through investments, savings, and compounding to achieve long-term goals.