Find out what the jargon means, with our reference guide.
£100 rule
An HM Revenue & Customs regulation. It states that if a child earns more than £100 interest a year on money that has been invested by a parent or step-parent, that parent will be liable for tax on all interest earned at his or her marginal rate.
A-Day
6 April 2006. This was the date when reforms to the pensions systems came into force, changing the way you can save for pensions and take them out.
Additional rate tax
A 45% rate of Income Tax applies to income of more than £150,000*, after allowable expenses and any tax-free allowances have been taken into account. A 50% tax rate was in force from April 2010 to 5April 2013. On 6 April 2013 the additional rate of tax returned to the originallevel of 45%.
See also: basic rate tax and higher rate tax.
Find out more about the different Income Tax rates at the GOV.UK website
Additional Voluntary Contribution (AVC) scheme
A scheme that allows you to make additional contributions to your existing occupational pension scheme, to boost the size of your fund.
Administrator
The person or people appointed by a court to administer (sort out the affairs of) the estate of somebody who dies without leaving a Will.
Annual allowance
The maximum you may invest into your pension funds in a given tax year and get tax relief. Currently the annual allowance is £50,000*.
Annuity
A stream of payments, usually fixed, made over an agreed time period. Most pensions are paid as an annuity. When you retire, you can choose to buy an annuity with your pension fund to secure a guaranteed regular income throughout your retirement.
Annual Percentage Rate (APR)
This is essentially the interest rate you will pay on a loan. It is called the APR because it also takes into account one-off fees, and so gives a measure of the total cost of your loan as a percentage.
Appointed representative
Adviser who has been declared fit and proper to act as an agent to deal with clients on behalf of an authorised financial services firm.
Assets
Things of value such as cash. When it comes to investments, your assets are the things you buy when you invest, such as shares in a company or a house.
Attendance Allowance
A tax-free, non-means tested benefit for people aged 65 or over who have an illness or disability and need help with personal care.
Authorised adviser
A financial adviser regulated by the Financial Conduct Authority (FCA) for introducing investment and insurance business.
Baby boomers
A term popularly used to describe people born during the boom in the national birthrate between 1945 and 1965.
Basic rate tax
A 20% rate of Income Tax applied to income of between £0 and £32,010*, after allowable expenses and any tax-free allowances have been taken into account.
See also: additional rate tax and higher rate tax.
Find out more about the different Income Tax rates at the GOV.UK website.
Basic State Pension
This is the pension you will receive from the Government as a result of the National Insurance contributions (NICs) you make during your working life. The basic State Pension is currently £110.15 per week* for a single person.
Benefactor
Someone who gives money or other benefits (often in a Will)
Beneficiary
Someone who receives money or other benefits from a benefactor (often in a Will)
Benefits Agency
A Government department that deals with social and welfare benefits.
Bonds
A form of investment. When you buy a bond, you are lending money to companies, governments or other organisations for a period of time at an agreed rate of interest. Typically, bonds are generally regarded as safer forms of investment than investments in shares, particularly when the market is volatile or a regular income is required.
Budgeting
An essential part of money management. It means working out your income and outgoings so that you can decide how much you have available to spend or save, and work out your financial priorities.
Bursary
A financial award made by an institution to an individual or a group to help with education or research. Bursaries are intended to cover course-related costs such as books, equipment, travel and study aids.
Cash
A type of asset. Money kept in a savings account is a cash asset.
Capital Gains Tax (CGT)
The tax you pay on any increase in the value of your assets that you benefit from. For example, selling shares for more than you paid for them may involve paying some CGT. You get a tax-free CGT allowance each tax year that means you only pay CGT on any gain currently over £10,900. The rate of CGT starts at 18%*, increasing to 28%* for higher rate and additional rate taxpayers. Entrepreneurs selling their businesses may get a special rate of 10%.
Capital Taxes Office
The part of HM Revenue and Customs that deals specifically with Capital Gains Tax and Inheritance Tax, which are both Capital Taxes.
Certified copy
A true copy of an original document. Certain professionals such as doctors, financial advisers and solicitors are able to certify copies of documents.
Child Benefit
Tax-free regular payments made to anyone bringing up a child or young person who qualifies. From 2013, the rules will change for some higher rate tax payers.
Find out more about these changes
Child Trust Fund
A long-term tax efficient savings and investment account for children introduced in 2002. The Government has introduced new legislation meaning that children born from 3 January 2011 will not qualify for a CTF account, and no further government payments will be made from this date.
Children's Bonds
Available through National Savings and Investments (NS&I), Childrens Bonds allow you to invest tax-free for your child's future in their own name. All returns on Children's Bonds are completely tax-free for you and your child, and the money invested is 100% secure as NS&I is backed by HM Treasury.
Child Tax Credits (CTC)
A benefit paid by the Government to support eligible families with children.
Civil partnership
A legally recognised union between two people of the same sex.
Code of Practice
Rules established by regulatory bodies or trade associations, which give a guide to acceptable behaviour.
Compound interest
Interest which is paid not only on the initial amount of an investment, but also on the interest already earned. The more frequently compound interest is paid, the sooner your accumulated interest will generate additional interest.
Corporate bond
A bond that is only issued by companies. They tend to offer higher rates of interest than bonds issued by governments as they can sometimes be a less secure investment.
Contracting out
If you opt to leave the State Second Pension (S2P) or State Earnings Related Pension Scheme (SERPS), you are contracting out. You will receive a rebate on your National Insurance contributions to invest in other personal pension arrangements.
Core and satellite strategy
An investment strategy that involves putting at least part of the money invested into a core of lower risk, broad-based collective funds, while picking satellites that are either riskier funds or individual shares.
Consumer Prices Index (CPI)
An index used to show the rate of inflation. It measures changes in the prices of a diverse mix of goods and services. Unlike the Retail Prices Index, The CPI does not include the cost of housing.
Credit rating
A record of how well you have managed your financial affairs in the past by, for example, meeting credit commitments on time. Your credit rating also takes account of your debt levels. This information is held by a credit reference agency, and various companies can consult it before they offer to lend you money or enter into credit agreements with you. You could be refused a loan because of a poor credit rating.
Critical illness insurance
An insurance policy, which pays out a lump sum if you are diagnosed with a health problem that meets the definition of a critical illness in the insurers policy conditions, provided you survive for a minimum period after diagnosis.
* figure applies to 2013/14
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