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Plain-English definitions of the financial, insurance, and investment terms you're most likely to encounter — so you always know what you're reading and hearing.
The distribution of investments across different asset classes — such as stocks, bonds, and cash — based on your risk tolerance, time horizon, and financial goals.
A person or entity designated to receive assets from an insurance policy, retirement account, or estate upon the death of the account holder.
The percentage of covered healthcare costs you pay after meeting your deductible. For example, with 80/20 coinsurance, your insurer pays 80% and you pay 20%.
The amount you pay out-of-pocket for covered services before your insurance begins to pay. Higher deductibles typically mean lower premiums.
The practice of spreading investments across different asset classes, sectors, and geographies to reduce the impact of any single investment's poor performance.
An investment approach that considers Environmental, Social, and Governance factors alongside financial metrics when selecting investments.
A financial advisor who is compensated solely by client fees — not by commissions on products sold. This structure eliminates conflicts of interest.
A legal standard requiring an advisor to act in the best interest of their client. Fee-only advisors are typically held to a fiduciary standard.
A tax-advantaged account available to individuals enrolled in a high-deductible health plan. Contributions are tax-deductible, growth is tax-free, and withdrawals for qualified medical expenses are tax-free.
A type of mutual fund or ETF designed to track the performance of a specific market index, such as the S&P 500. Index funds typically have lower fees than actively managed funds.
An alternative to Original Medicare offered by private insurance companies. Medicare Advantage plans typically include prescription drug coverage and may offer additional benefits.
A private insurance policy that helps cover costs not paid by Original Medicare, such as copayments, coinsurance, and deductibles.
The most you'll pay for covered healthcare services in a plan year. After reaching this limit, your insurance pays 100% of covered costs.
The amount you pay for insurance coverage, typically on a monthly basis. Premiums are paid regardless of whether you use your insurance.
The minimum amount you must withdraw annually from traditional IRAs and most employer-sponsored retirement plans once you reach age 73.
An individual retirement account funded with after-tax dollars. Qualified withdrawals in retirement are tax-free, and there are no required minimum distributions during the owner's lifetime.
Life insurance that provides coverage for a specific period (term). If the insured dies during the term, the death benefit is paid to beneficiaries. Term insurance is typically the most affordable type of life insurance.
Permanent life insurance that provides coverage for the insured's entire life and includes a cash value component that grows over time.
Still Have Questions?
If you encounter a term you don't understand — in our materials or anywhere else — just ask. That's what we're here for.