Cashing In
When you sell something for more than you paid, you make this.
What is a profit?
This is the price per share of a mutual fund, updated once each trading day after markets close.
What is the net asset value (NAV)?
Money a company gives you just for owning its stock.
What is a dividend ?
The time when you stop working full-time for a paycheck.
What is retirement?
A small piece of ownership in a company that you can buy or sell on an exchange.
What is a share of stock?
A lower tax rate you get if you keep a stock for over a year before selling.
What is the long-term capital gains rate?
A mutual fund that tries to match the performance of a market benchmark like the S&P 500 is called this.
What is an index fund?
The rent you collect every month from people living in your house or apartment.
What is rental income?
Money you save while working so you can use it later when you retire.
What is a retirement savings account
The place where people buy and sell stocks, like the NYSE or Nasdaq.
What is the stock market?
To defer paying taxes after selling a rental property, many investors use this “like-kind” exchange.
What is a 1031 exchange?
The yearly percentage of your investment that covers management and operating costs is known as this.
What is the expense ratio?
This type of bond sends you fixed interest payments twice a year.
What is interest from a bond?
Because prices usually rise over time, retirees must plan for this gradual loss of buying power.
What is inflation?
When a stock’s price goes up, investors say it’s doing this.
What is going up or rising?
This type of order tells your broker to automatically sell a stock once it reaches a set price, locking in profits.
What is a stop-limit (or stop-loss) order?
This type of mutual fund invests mainly in bonds instead of stocks.
What is a bond fund?
Creators of books, songs, or photos can keep earning money every time their work is used, thanks to these payments.
What are royalties?
A common rule of thumb says you can safely withdraw about this percent of your portfolio each year without running out of money.
What is the 4% rule?
Money a company pays to shareholders, often every three months.
What is a dividend?
When a company buys back its own shares, investors can “cash in” because this typically increases the value of the remaining shares.
What is a stock repurchase or buyback?
A mutual fund that allows investors to buy or sell shares at any time during the day on the market, like a stock, is actually this kind of fund.
What is an exchange-traded fund (ETF)?
Money you earn from letting someone else use your land for farming or cell towers.
What is lease income?
A simple budget item you still need to pay for every month after you retire—like food, housing, or utilities.
What are living expenses?
The opposite of a “bull market,” when stock prices keep falling.
What is a bear market?