A fuller guide to this term is on the way. In the meantime, the related terms below explain the ideas around it.
Related MoneyPedia terms
- Savings RateThe share of your income you set aside rather than spend, usually shown as a percentage of your take-home pay.
- Automatic SavingsScheduled transfers that move money into savings on their own, making it easier to save without relying on willpower.
- Spending PlanA forward-looking plan for where each dollar of income will go before you spend it, covering bills, saving, and everyday costs.
- Emergency FundCash set aside for life's surprises, so a bad week doesn't turn into debt.
- Sinking FundA savings pot you build up gradually for a known future expense, like holiday gifts or a car repair, so it does not blindside your budget.
- Zero-Based BudgetingA budgeting method where you assign every dollar of income a job until nothing is left unassigned, so income minus all allocations equals zero.
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Plain-English education — not personalized legal, tax, or investment advice.