A clear and concise glossary of the main personal finance terms. Find here the essential definitions to understand the blog articles.
A
- Arbitrage
- Transferring all or part of the invested sums from one underlying to another within the same life insurance contract or PEA.
C
- Capitalization
- Mechanism by which the interest generated by an investment is reinvested to generate additional interest in turn.
D
- Defiscalization (tax relief)
- All legal mechanisms allowing a reduction of income tax or real estate wealth tax.
L
- Life insurance
- Long-term savings product allowing capital to be built with favourable taxation after 8 years, optimised transmission and a wide choice of underlyings.
- Livret A
- French regulated savings passbook, tax-free, capped at 22,950 euros for an individual.
P
- PEA (Equity Savings Plan)
- Tax wrapper allowing investment in European equities with exemption from income tax on gains after 5 years.
- PER (Retirement Savings Plan)
- Long-term savings product deductible from income tax at entry, taxed at exit.
- Private Equity
- Investment in the capital of unlisted companies, usually with a holding horizon greater than 5 years.
R
- Return (Yield)
- Performance of an investment expressed as a percentage, calculated on an annual basis.
T
- APR (TAEG)
- Annual Percentage Rate. Includes all the costs of a loan (interest, insurance, fees). Main indicator for comparing credit offers.
U
- Unit-linked funds
- Investment supports in life insurance whose value fluctuates according to financial markets (equities, bonds, real estate).
W
- Wealth tax (IFI)
- French real estate wealth tax. Applies to net real estate assets above 1.3 million euros.