Personal Finance Glossary
Plain-English definitions of the terms that come up most often in personal finance — SIPs, EMIs, lock-ins, compounding, and the rules of thumb that quietly shape your money decisions.
Every term, in plain English.
No jargon explained with more jargon. Each entry answers what the term means, how it works, and what it changes about a decision you are actually making.
TaxELSS (Equity Linked Savings Scheme)
ELSS is a category of equity mutual fund that qualifies for tax deduction under Section 80C of the Income Tax Act, with a mandatory 3-year lock-in.
Also known as:Equity Linked Savings Scheme
TaxPPF (Public Provident Fund)
The Public Provident Fund is a government-backed, long-term savings scheme with a 15-year lock-in, tax-free interest, and Section 80C tax benefits.
Also known as:Public Provident Fund
LoansEMI (Equated Monthly Installment)
An EMI is the fixed monthly amount you pay to a lender to repay a loan over a set period, comprising both principal and interest.
Also known as:Equated Monthly Installment
Budgeting50/30/20 Rule
The 50/30/20 rule is a budgeting framework that splits your post-tax income into 50% needs, 30% wants, and 20% savings and debt repayment.
Also known as:50-30-20 budget rule
SavingsEmergency Fund
An emergency fund is a pool of easily accessible cash set aside to cover unexpected expenses without forcing you to break investments or take on debt.
Also known as:rainy day fund
InvestingCAGR (Compound Annual Growth Rate)
CAGR is the smoothed annual rate at which an investment would have grown if it had compounded steadily over a given period.
Also known as:Compound Annual Growth Rate
InvestingCompound Interest
Compound interest is interest earned not just on your original investment, but also on the interest that has already been added to it.
Also known as:compounding
BudgetingBudget
A budget is a plan that assigns every rupee of your monthly income to a purpose — spending, saving, or repaying debt — before the month begins.
Also known as:monthly budget
GeneralNet Worth
Net worth is what you own minus what you owe — the single number that measures financial position, as opposed to income, which only measures cash flow.
Also known as:personal net worth
GeneralCTC (Cost to Company)
CTC is the total annual amount an employer spends on an employee, including benefits and contributions that never appear in the monthly bank credit.
Also known as:Cost to Company
GeneralIn-Hand Salary
In-hand salary is the amount actually credited to your bank account each month after all deductions — the only figure a budget should be built on.
Also known as:take-home salary
LoansDebt Snowball
The debt snowball is a repayment strategy that clears your smallest balance first, then rolls that freed-up payment onto the next-smallest debt.
Also known as:snowball method
LoansDebt Avalanche
The debt avalanche is a repayment strategy that targets your highest interest rate first, which always costs the least in total interest.
Also known as:avalanche method
LoansCredit Score
A credit score is a three-digit rating, usually between 300 and 900 in India, that summarises how reliably you have repaid borrowed money.
Also known as:CIBIL score
InvestingMutual Fund
A mutual fund pools money from many investors and invests it in a portfolio of stocks, bonds, or other assets, managed by a professional fund manager.
Also known as:MF
InvestingNAV (Net Asset Value)
NAV is the per-unit price of a mutual fund, calculated as the total value of the fund's holdings minus its liabilities, divided by the number of units.
Also known as:Net Asset Value
InvestingXIRR
XIRR is the annualised return on an investment with irregular cash flows — the correct way to measure what a SIP has actually earned.
Also known as:Extended Internal Rate of Return
Knowing the word is the easy half.
Track every rupee, automate your budgets, and run the numbers on a SIP, an EMI or an emergency fund — all in one app.