(or all the things you want to know but were too shy to ask.)

We said we would break down the jargon so here it is. A glossary of financial terms.

Asset — all shares, bonds, cash etc owned by the scheme.

Aggressive portfolio — are you someone that likes to take risks? An aggressive portfolio is a type of investment that involves taking on a higher level of risk in order to potentially earn higher returns.

Balanced funds — a type of fund that aims to provide a balance between stability and growth.

Bond — lending money to a company or government. It is a way to invest your money that is considered less risky. Think of it as loaning a friend money with a promise they will give it back with some extra cash.

Budget — an estimate of income and expenditure for a set period of time.

Capital — the money you initially put into an investment. (For example, if you invest $100 in a bank term deposit this is your capital amount on which you get paid interest.)

Commodity — a commodity is any raw material, such as oil, gold and cattle, traded on an exchange or in the cash market.

Compounding interest — it’s interest on interest. It’s the magic of superannuation.

Conservative fund — is a type of investment that aims to make you money without taking on too much risk.

Dividend — a payment from a company's profits to its shareholders in proportion to the number of shares the shareholder owns (typically a payment of cash).

Dollar Cost Averaging — putting a set amount of money into your investment portfolio on a regular basis, regardless of the share price.

Emergency Fund — a stash of cash that you put aside and tell no-one about and if you need to leave a toxic relationship or workplace you can do this without having to rely on anyone else's money.

Equity — the sum of your assets, for example the value of your house, once your debts have been subtracted from it.

ETF — Exchange Traded Funds. An ETF is a collection of hundreds or thousands of stocks or bonds, managed by experts, in a single fund that trades on major stock exchanges, like the New Zealand Stock Exchange.

Gender pay gap — the difference between the median hourly earnings of women and men in full and part-time work.

Inflation — the rate at which the prices of goods and services increase over time, often equated with loss of purchasing power.

Interest rates — the interest rate is an additional amount paid by a borrower to a lender for using the financial asset.

Investment Horizon — the length of time you’re aiming to invest for. Often described as either short- term, mid-term or long-term investment horizon.

Investing — when you put money into shares, funds, property etc, with the expectation of growing the money you initially put in.

Managed funds — a managed fund is an investment that pools your money together with other investors. The managed fund then buys shares, bonds and/or other securities; what they hold is known as an ‘investment portfolio’.

Motherhood gap — the motherhood pay gap measures the pay gap between mothers and non- mothers, the latter defined in most econometric studies as women without dependent children. It also measures the pay gap between mothers and fathers.

Mortgage — a mortgage is a loan for the purpose of buying a home.

Net worth — net worth is a measure of wealth; it is the sum of all assets owned by you or your company, minus any obligations or liabilities.

Portfolio — the selection of investments you hold.

Return — the amount an investment has increased or decreased, represented as a percentage or dollar amount.

Risk — the level of exposure your investments have to the potential of loss.

Securities — a security is a tradable financial asset used to raise capital in public and private markets. There are primarily three types of securities: equity—which provides ownership rights to holders; debt—essentially loans repaid with periodic payments; and hybrids—which combine aspects of debt and equity.

Share — the ownership of a company can be broken into smaller pieces and sold, this is called a ‘share’.

Shareholder — someone who owns shares in a specific company.

Share Market — a market where shares are bought and sold. Like a farmers market, but instead of fruit and veggies — it’s shares!

We are here to help and support you on your financial wellness journey!