Glossary

The Kids Investing Glossary

44 money words, defined in plain English for parents — each with a one-line way to explain it to your kid. These are the same words that power the Weekly Recap inside MemoryBank.

529 Plan

A tax-advantaged account designed for saving toward education.

Asset

Anything you own that has value or can produce value.

Bear Market

An extended stretch when prices are broadly falling.

Bond

A loan you make to a company or government that pays you back with interest.

Brokerage Account

The account that holds investments and lets you buy, hold, and sell them.

Bull Market

An extended stretch when prices are broadly rising and optimism is high.

Capital Gain

The profit made when you sell an investment for more than you paid.

Company

An organization that makes products or provides services to earn money.

Compounding

When your growth starts earning growth of its own, snowballing over time.

Diversification

Spreading money across many investments so one loss can't sink the whole thing.

Dividend

A portion of a company's profits paid out to shareholders for owning it.

Dollar-Cost Averaging

Investing a fixed amount on a regular schedule instead of trying to time the market.

Emergency Fund

Money set aside in a safe place to cover unexpected expenses.

Entrepreneurship

Starting and running your own business, taking on its risks for a share of its rewards.

ETF

A fund holding many investments at once that trades like a single stock.

Financial Independence

Having enough assets and passive income to cover your living costs without needing a paycheck.

Fractional Shares

Owning a slice of a single share, so you can invest any dollar amount.

Goal

A specific target you're saving or investing money toward.

Index Fund

A fund that tracks a whole market group instead of trying to pick winners.

Inflation

The gradual rise in prices that makes each dollar buy a little less over time.

Interest

Money earned for saving or lending, usually shown as a percentage.

Investing

Putting money into things that can grow in value over time, instead of leaving it idle.

Investor

Someone who puts money into things expecting them to grow in value.

Long-Term Investing

Holding investments for years or decades to ride out short-term ups and downs.

Market Cap

A company's total market value — its share price times all its shares.

Net Worth

Everything you own minus everything you owe.

Opportunity Cost

The value of the best thing you give up when you make a choice.

Ownership

Holding a real, legal stake in something, with a claim on its value.

Passive Income

Income that keeps coming without ongoing hour-for-hour work.

Patience

Letting investments work over time instead of reacting to every move.

Portfolio

The full collection of investments a person owns.

Profit

What a company keeps after paying all of its costs.

Reinvesting

Using earnings like dividends to buy more investments, so they compound.

Return

The gain or loss an investment produces, often shown as a percentage.

Revenue

All the money a company brings in from sales, before any costs.

Risk

The chance that an investment loses value.

Roth IRA

A retirement account, fundable once a kid has earned income, where growth is tax-free.

Saving

Setting money aside now to use later, usually somewhere safe and easy to reach.

Share

One unit of ownership in a company.

Stock Market

The marketplace where shares of public companies are bought and sold.

Ticker

The short letter symbol that identifies a stock, like AAPL for Apple.

Time Horizon

How long until you'll need the money you're investing.

UTMA

A custodial account an adult manages for a child until the age of majority.

Volatility

How much and how fast a price swings up and down.

MemoryBank is a display and education tool, not a financial advisor. Nothing here is investment, tax, or legal advice.