| Deposit |
A deposit is where you place funds with a financial
institution and they agree to pay you interest on your money. Is it generally
a low-risk way of saving funds, however return is also generally low. Notice
accounts let you take out your funds on demand; fixed term or notice accounts
require you to give notice of withdrawal or face penalties. |
| Unit Linked |
You invest in a fund by purchasing units of that fund. The
value of the units is determined by the investment performance of the underlying
assets, i.e., what the fund manager invests in. |
| SSIA |
Special Savings Investment Account. A specially designated
account offered by some financial institutions requiring regular contibutions
which are topped up by the govermnent. New SSIAs can no longer be taken
out (deadline was 2002). |
| Short Term |
A short term investment is one which you expect to liquidate
within a year |
| Long Term |
A long term investment is one which you expect to hold for
over a year |
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| Term Life |
An insurance policy which pays out a defined amount if the
policyholder dies before a specified date. |
| Mortgage Protection |
An insurance policy which pays out the amount of a mortgage,
generally to the mortgage provider, in the event of death of the policyholder. As
the mortgage amount decreases over time, so does the mortgage protection
amount. |
| Whole of Life |
An insurance policy which pays out a defined amount when the
policyholder dies.
It differs from a term life policy in that there is
no fixed expiration date, i.e. there is a guaranteed payout. |
| Section 60 |
A protection policy arranged for the purpose of providing funds
on death to pay Inheritance Tax |
| Keyman Cover |
Policy effected by a company on the life of a key employee
or director to compensate the company for loss of profits it may suffer in the event of the
death and/or serious illness of the individual |
| Serious Illness Cover - Whole of Life |
An insurance policy which pays out a defined amount when the
policyholder suffers a serious illness before death. The illnesses covered
are listed in the policy. |
| Serious Illness Cover - Term Policy |
An insurance policy which pays out a defined amount when the
policyholder suffers a serious illness within a specified period. The illnesses
covered are listed in the policy. |
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Income Protection |
A policy that will pay upto 75% of your income in the event that you are unable
to work due to any illness. Injury or disability. |
| Personal Pension Plan |
A pension plan which can be taken out by an individual with
a view to providing income for retirement. The individual pays directly
into the pension plan or has contributions deducted from salary. A PRSA
is a type of personal pension plan. |
| Executive Pension Plan |
A defined contribution or defined benefit occupational pension
scheme set up by an employer for senior employees to provide retirement. Usually
includes additional benefits such as death in service. |
| Group Pension Plan |
A defined contribution or defined benefit occupational pension
scheme set up by an employer for senior employees to provide retirement. |
| SSAP |
A small self administered pension plan, set up through a pension trustee, investment
options are more flexible. |
| Self Directed Pension Plan |
A pension plan where the beneficiary directs the investment
decisions which are made. |
| PRSA |
Personal Retirement Savings Account. A type of Personal Pension
Plan that is portable amongst employers. |
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| Capital Guaranteed Fund |
A fund which guarantees the investor a minimum value of the
original investment
amount provided they keep it invested for a specified period of time (e.g. 5 or
7 years) |
| Income Fund |
A fund which invests in securties which are designed to provide
a regular income stream for the fund holder. |
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| Risk |
A risky investment is one where the outcome of the investment
is less predicable than a non-risky investment. |
| Return |
The increase (or decrease) in the value of an investment over
a period. Return also includes any income derived from the investment
over the term. |
| Managed Funds |
Funds managed by fund managers who invest in equities, bonds
or other securities. |
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| Conversion Option |
Policyholder can convert the cover into another policy for
the same term again without evidence of health |
| Indexation Option |
Option to Increase benefits in line with inflation. Preimums
would also increase by a corresponding amount. |
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