Financial dictionary

Inflation means prices are rising over time. If inflation is high, the same amount of cash buys fewer goods and services.

If a meal cost ₱200 last year and ₱220 this year, that's price inflation.

The interest rate is the cost of borrowing money, or the reward for saving it, usually shown as a percentage per year.

A 5% interest rate on a ₱10,000 loan means you'd owe ₱500 in interest over a year.

A stock is a small ownership share in a company. Owning stock means you own a tiny piece of that business.

Buying 1 share of a company gives you a small claim on its profits and assets.

A bond is essentially a loan you give to a company or government, which pays you back with interest over time.

Buying a government bond means you're lending money to the government in exchange for regular interest payments.

GDP (Gross Domestic Product) measures the total value of all goods and services a country produces in a given period.

If a country's GDP grows 3% this year, its economy produced 3% more value than last year.

An ETF (Exchange-Traded Fund) is a basket of many stocks or bonds bundled into one investment you can buy like a single stock.

An ETF tracking the top 500 US companies lets you invest in all of them at once, with one purchase.

Diversification means spreading investments across different assets so one bad investment doesn't damage the whole portfolio.

Instead of putting everything into one stock, a person may hold stocks, bonds, cash, and real estate.

Liquidity means how easily something can be turned into cash without losing value.

Cash is highly liquid; a house is less liquid because selling it takes time.

A portfolio is the full collection of investments a person or institution holds, such as stocks, bonds, and cash combined.

A portfolio might be 60% stocks, 25% bonds, 10% cash, and 5% gold.

A recession is a significant decline in economic activity, usually shown by shrinking GDP over several months.

During a recession, businesses may hire less, and unemployment often rises.

Asset allocation is how an investor divides money across different types of investments, like stocks, bonds, and cash.

A young investor might choose 80% stocks and 20% bonds for higher long-term growth potential.

An index fund is a fund designed to track the performance of a market index, like a whole stock market, rather than trying to beat it.

An index fund tracking a national stock index rises and falls roughly in line with that index.

Volatility measures how much and how quickly the price of an investment moves up and down.

A stock that swings 10% in a day is more volatile than one that moves 0.5%.

Compound interest is interest earned on both your original money and on the interest it has already earned.

₱1,000 growing at 7% a year becomes about ₱1,967 after 10 years, because each year's interest earns interest too.

A budget is a simple plan for how you'll spend and save your money over a set period, usually a month.

On a ₱20,000 monthly income, a budget might set ₱12,000 for needs, ₱4,000 for wants, and ₱4,000 for savings.

An emergency fund is money set aside for unexpected costs, like a job loss or a medical bill, so you don't have to borrow.

If your monthly expenses are ₱15,000, a solid emergency fund of three months would be about ₱45,000 in savings.

Net worth is what you own minus what you owe. It's a snapshot of your overall financial health.

If you own ₱500,000 in assets and owe ₱200,000 in loans, your net worth is ₱300,000.

Debt is money you've borrowed and still owe, usually with interest added on top until you pay it back.

Borrowing ₱50,000 at 10% interest means you'll repay the ₱50,000 plus around ₱5,000 in interest over a year.

A credit score is a number that shows lenders how reliably you repay borrowed money. A higher score usually means better loan terms.

Someone who always pays bills on time may score high, helping them get a ₱1,000,000 home loan at a lower interest rate.

A credit card lets you borrow money up to a limit to pay for things now and settle the bill later. Unpaid balances charge interest.

If you spend ₱8,000 and only pay part of it, the remaining balance may build up interest at over 3% per month.

A mortgage is a long-term loan used to buy a home, where the property itself is the collateral if you can't repay.

A ₱2,000,000 mortgage over 20 years is paid back in monthly installments that cover both principal and interest.

The principal is the original amount of money borrowed or invested, before any interest is added on.

On a ₱100,000 loan, the ₱100,000 is the principal, and any interest is charged on top of that amount.

APR (Annual Percentage Rate) is the yearly cost of borrowing, including interest and certain fees, shown as one percentage.

A credit card with a 36% APR means carrying a ₱10,000 balance for a year could cost about ₱3,600 in charges.

A savings account is a bank account that holds your money safely and pays a small amount of interest over time.

Keeping ₱50,000 in a savings account at 2% interest earns you about ₱1,000 over a year.

A time deposit locks your money in the bank for a fixed period in exchange for a higher interest rate than a regular savings account.

Placing ₱100,000 in a one-year time deposit at 5% could earn about ₱5,000, but you can't touch it early without a penalty.

Income tax is a portion of what you earn that you pay to the government to fund public services like roads and schools.

If you earn ₱30,000 a month and fall in a 20% bracket on part of it, a slice of your pay goes to income tax.

A dividend is a share of a company's profits paid out to its shareholders, usually as cash on a regular schedule.

If you own 100 shares that pay a ₱2 dividend each, you'd receive ₱200 for that payout period.

A capital gain is the profit you make when you sell an investment for more than you paid for it.

Buying a stock at ₱1,000 and selling it later at ₱1,300 gives you a ₱300 capital gain.

A mutual fund pools money from many investors and a manager uses it to buy a mix of stocks, bonds, or other assets.

Investing ₱5,000 in a mutual fund spreads it across dozens of companies chosen by the fund's manager.

Yield is the income an investment produces, shown as a percentage of its price, such as interest or dividends per year.

A ₱1,000 bond paying ₱50 a year has a 5% yield.

Risk is the chance that an investment loses value or does not perform as you hoped. Higher potential returns usually come with higher risk.

Putting ₱10,000 into a single small startup carries more risk than spreading it across an index fund.

A bull market is a period when investment prices are generally rising and investor confidence is high.

During a bull market, a portfolio worth ₱100,000 might climb steadily over months as prices trend upward.

A bear market is a period when investment prices fall significantly, often by 20% or more, and investors turn cautious.

In a bear market, a portfolio worth ₱100,000 could drop to ₱80,000 or lower as prices slide.

Cryptocurrency is digital money that runs on a decentralized network instead of a bank. Its prices can swing sharply.

Someone might buy ₱5,000 worth of a cryptocurrency, then watch its value rise or fall 10% in a single day.

Appreciation is when something you own rises in value over time, like property or an investment becoming worth more.

A lot bought for ₱1,000,000 that is later worth ₱1,400,000 has appreciated by ₱400,000.

Depreciation is the loss in value of something over time, often from wear and tear or age, such as a car or equipment.

A new car bought for ₱1,200,000 might be worth only ₱900,000 after a couple of years due to depreciation.

An exchange rate is how much one country's currency is worth in another country's currency.

If the exchange rate is ₱56 to $1, then ₱5,600 can be swapped for about $100.

A remittance is money sent home by someone working abroad, often supporting family back in their home country.

An overseas worker sending ₱25,000 a month to their family in the Philippines is making a remittance.

A central bank is a country's main monetary authority. It manages interest rates and the money supply to keep the economy stable.

When prices rise too fast, a central bank may raise interest rates to cool spending and slow inflation.

Monetary policy is how a central bank influences the economy by adjusting interest rates and the amount of money in circulation.

To fight high inflation, a central bank might tighten monetary policy by raising interest rates.

Fiscal policy is how a government uses spending and taxes to influence the economy, such as building projects or changing tax rates.

In a slowdown, a government might boost spending on infrastructure to create jobs and lift demand.

Unemployment refers to people who are able and willing to work but cannot find a job. It's often shown as a rate.

An unemployment rate of 5% means about 5 out of every 100 people in the workforce are looking for work but jobless.

Supply and demand is the balance between how much of something is available and how much people want it. Together they shape prices.

When a popular gadget is scarce but everyone wants it, the price climbs. If shelves overflow and few buy, prices drop.

Opportunity cost is the value of the next best thing you give up when you make a choice with limited money or time.

Spending ₱5,000 on a new gadget means the opportunity cost is the investment or savings that same ₱5,000 could have become.

Amortization is paying off a loan in equal regular installments, where each payment covers a bit of interest and a bit of the principal.

A ₱600,000 car loan over 5 years might be amortized into fixed monthly payments of around ₱12,000 that slowly shrink the balance.

Collateral is something valuable you pledge to back a loan. If you can't repay, the lender can take it to recover their money.

If you borrow ₱500,000 using your car as collateral and stop paying, the lender can repossess the car.

Default is when a borrower fails to make required loan payments. It damages credit and can trigger penalties or loss of collateral.

Missing several months of payments on a ₱300,000 loan can put it in default and hurt your credit for years.

Refinancing means replacing an existing loan with a new one, usually to get a lower interest rate or a more manageable payment.

Refinancing a ₱2,000,000 mortgage from 8% down to 6% could save you thousands of pesos in interest each year.

A down payment is the upfront cash you pay toward a big purchase, with the rest usually covered by a loan.

On a ₱2,500,000 condo, a 20% down payment would be ₱500,000 paid upfront, with the balance financed.

Escrow is when a neutral third party holds money or documents until both sides of a deal meet their agreed conditions.

In a property sale, a buyer's ₱200,000 deposit may sit in escrow until the title is verified and the deal closes.

Home equity is the part of your home you truly own, calculated as its market value minus what you still owe on the mortgage.

If your home is worth ₱3,000,000 and you still owe ₱1,800,000, your home equity is ₱1,200,000.

Leverage means using borrowed money to invest, which can boost gains but also magnify losses.

Using ₱100,000 of your own cash plus ₱100,000 borrowed to invest doubles your exposure, and your gains or losses.

Margin is money you borrow from a broker to buy investments, using the investments themselves as collateral.

Buying ₱50,000 of stock with ₱25,000 of your own money and ₱25,000 on margin means you owe the broker the borrowed half plus interest.

Short selling is betting that a stock's price will fall by borrowing shares, selling them, then buying them back cheaper to return.

If you short a stock at ₱100 and buy it back at ₱70, you pocket ₱30 per share, but if it climbs to ₱150 you lose ₱50.

Dividend yield shows how much a company pays in dividends each year compared to its share price, expressed as a percentage.

A stock priced at ₱200 that pays ₱10 in dividends a year has a 5% dividend yield.

Market capitalization, or market cap, is the total value of a company's shares, found by multiplying share price by the number of shares.

A company with 10 million shares priced at ₱50 each has a market cap of ₱500 million.

A blue chip stock is a share in a large, well-established, financially solid company with a long track record of stability.

Shares in a decades-old, nationwide bank or conglomerate are often called blue chips because they are relatively steady.

A penny stock is a very low-priced share in a small company. They can be highly volatile and risky.

A stock trading at ₱2 per share might jump or crash sharply on light trading, making it a risky penny stock.

An IPO (Initial Public Offering) is when a private company first sells its shares to the public on a stock exchange.

A growing company might launch an IPO to raise ₱1 billion by offering its shares to everyday investors for the first time.

A ticker symbol is a short code of letters that identifies a company's stock on an exchange.

Instead of typing a full company name, you search its ticker, like a few letters, to find its share price.

A broker is a person or platform that buys and sells investments on your behalf, usually charging a fee or commission.

You might use an online broker to buy ₱10,000 of stock, paying a small commission on the trade.

The bid is the highest price a buyer will pay, and the ask is the lowest price a seller will accept. The gap between them is the spread.

If a stock's bid is ₱99 and its ask is ₱100, a buyer and seller meet somewhere in that ₱1 spread to trade.

A market order is an instruction to buy or sell an investment immediately at the best price currently available.

Placing a market order to buy a stock quoted near ₱150 fills right away at roughly that price.

A limit order sets the exact price you're willing to buy or sell at, and it only fills if the market reaches that price.

You could set a limit order to buy a stock at ₱140, and it only executes if the price drops to ₱140 or lower.

A stop loss is an order that automatically sells an investment once it falls to a set price, helping cap your losses.

If you buy a stock at ₱200 and set a stop loss at ₱180, it sells automatically if the price drops to ₱180.

A market correction is a drop of about 10% or more from a recent high, usually shorter and milder than a bear market.

If an index falls from 7,000 to around 6,200 after a strong run, that roughly 10% dip is called a correction.

A market crash is a sudden, steep drop in prices across a market, often driven by panic selling in a short time.

In a crash, a portfolio worth ₱200,000 could lose a large chunk of its value within days as prices tumble.

A hedge is an investment made to offset potential losses in another position, like a form of financial insurance.

Someone worried about a stock falling might buy an option that gains value if the stock drops, hedging the risk.

Derivatives are contracts whose value comes from an underlying asset, like a stock, currency, or commodity, rather than the asset itself.

An option that lets you buy a stock at ₱100 later is a derivative, since its worth depends on that stock's price.

A commodity is a basic raw material that is traded and interchangeable, such as gold, oil, rice, or coffee.

Prices of commodities like rice or fuel can rise with demand, which then pushes up costs at the market.

Forex, short for foreign exchange, is the global market where currencies are traded against each other.

A trader in the forex market might swap pesos for dollars, aiming to profit if the exchange rate moves in their favor.

Take-home pay is the amount of salary you actually receive after taxes and mandatory deductions are taken out.

A ₱25,000 monthly salary might become about ₱22,000 in take-home pay after tax, SSS, PhilHealth, and Pag-IBIG deductions.

An SSS contribution is a monthly payment to the Social Security System in the Philippines that funds benefits like pension, sickness, and maternity.

A portion of your monthly salary, often shared with your employer, is deducted as an SSS contribution toward your future benefits.

PhilHealth is the Philippines' national health insurance program, funded by regular contributions that help cover hospital and medical costs.

A monthly PhilHealth deduction from your pay helps offset bills if you are hospitalized, reducing what you pay out of pocket.

The Pag-IBIG Fund is a Philippine government savings program that helps members save and access affordable housing loans.

Regular Pag-IBIG contributions build savings you can later tap, and they can qualify you for a low-rate home loan.

A cooperative is a group owned and run by its members, who pool money to save, borrow, and share in any profits.

Joining a coop, you might save ₱500 a month and later borrow at lower rates than a bank, with earnings shared among members.

The time value of money is the idea that a peso today is worth more than the same peso in the future, because it can earn interest.

₱10,000 now could grow to ₱10,500 in a year at 5%, so getting the money today beats getting it later.

Dollar-cost averaging is investing a fixed amount on a regular schedule, no matter the price, to smooth out the ups and downs over time.

Investing ₱2,000 every month buys more shares when prices are low and fewer when high, averaging out your cost.

An expense ratio is the yearly fee a fund charges, shown as a percentage of your investment, that quietly reduces your returns.

A 1% expense ratio on a ₱100,000 fund investment costs you about ₱1,000 a year, deducted automatically.

A prospectus is an official document that explains an investment's details, risks, and costs so you can decide before putting money in.

Before buying a mutual fund, you can read its prospectus to see the fees, strategy, and risks involved.

A sinking fund is money you set aside little by little for a specific planned expense, so it does not hit your budget all at once.

Saving ₱2,000 a month in a sinking fund gives you ₱24,000 for next year's tuition or insurance without scrambling.

A grace period is a set stretch of time after a due date when you can pay without a penalty or extra interest.

A credit card with a 21-day grace period lets you pay the full ₱8,000 balance within that window with no interest charged.

An overdraft happens when you spend more than your account holds, and the bank covers the gap while usually charging a fee.

If your balance is ₱500 but a ₱700 payment clears, you are ₱200 overdrawn and the bank may add an overdraft fee.

Bankruptcy is a legal process for people or companies that cannot repay their debts, aiming to settle or discharge what they owe.

A business drowning in ₱5,000,000 of unpayable debt might file for bankruptcy to restructure or wipe out those obligations.

13th-month pay is a mandatory extra payment Philippine employers give rank-and-file employees each year, roughly equal to one month's basic salary, usually paid by December 24.

If your monthly basic salary is ₱20,000 and you worked the full year, you'd receive about ₱20,000 as your 13th-month pay.

Gross income is your total pay before taxes and other deductions are subtracted, the full amount your employer agrees to pay you.

If your job pays ₱30,000 a month before any deductions, that ₱30,000 is your gross income.

Net income is what's left of your earnings after taxes, contributions, and other deductions are subtracted from your gross income.

If your gross income is ₱30,000 and ₱5,000 goes to taxes and contributions, your net income is ₱25,000.

Withholding tax is income tax your employer deducts from your salary and remits to the government on your behalf before you even receive your pay.

Instead of paying a lump sum at year-end, a portion of each ₱25,000 paycheck is withheld and sent to the BIR as withholding tax.

Regularization is when a probationary employee becomes a regular employee, usually after meeting performance standards within a set period, gaining fuller job security and benefits.

After six months as a probationary hire, an employee who meets company standards is regularized and keeps their ₱25,000 monthly salary with added job security.

Final pay is the total amount owed to an employee after leaving a job, including unpaid salary, unused leave, and any pro-rated 13th-month pay.

Leaving a job mid-year, you might receive ₱15,000 in final pay covering your last days worked plus a pro-rated 13th-month amount.

Freelance income is money earned from self-directed project or client work rather than a fixed employer, and it isn't automatically taxed the way an employee's salary is.

A freelance designer earning ₱40,000 in a month must set aside money for taxes herself, since no employer withholds it automatically.

Self-employed contributions are the SSS, PhilHealth, and Pag-IBIG payments that freelancers and business owners must pay entirely on their own, since there's no employer to share the cost.

A self-employed vendor might pay around ₱1,200 a month combined for SSS, PhilHealth, and Pag-IBIG, all out of her own pocket.

InstaPay is a real-time electronic fund transfer service in the Philippines for sending smaller amounts between banks and e-wallets almost instantly.

Sending ₱5,000 to a friend's account through InstaPay usually lands in their e-wallet within minutes.

PESONet is a Philippine electronic fund transfer service best suited for larger transfers between banks, which typically settle within one business day rather than instantly.

Paying a ₱150,000 supplier invoice through PESONet usually clears by the next business day.

A digital bank operates entirely online without physical branches, offering accounts, savings, and payments through an app instead of teller counters.

You can open a digital bank account and start earning interest on ₱5,000 without ever visiting a branch.

The PDIC (Philippine Deposit Insurance Corporation) protects bank depositors by insuring deposits up to a set limit if a bank fails.

If a bank holding your ₱300,000 savings shuts down, PDIC insurance can reimburse you up to the coverage limit.

An ATM fee is a charge for withdrawing cash or checking your balance at a machine that doesn't belong to your own bank's network.

Withdrawing ₱2,000 from another bank's ATM might cost you an extra ₱18 fee on top of the cash you take out.

A dormancy fee is a charge some banks apply to accounts that have had no activity for a long period, slowly eating into the balance.

An account left untouched for two years with only ₱300 in it could shrink further if the bank applies a monthly dormancy fee.

A money changer is a business that exchanges one currency for another in person, often at a different rate than banks offer.

A traveler might swap $200 for pesos at an airport money changer, though the rate may be less favorable than at a bank.

Dynamic currency conversion is when a foreign merchant or ATM offers to charge your card in your home currency instead of the local one, usually at a worse exchange rate.

Paying for a ₱2,000 meal abroad and being asked 'charge in pesos instead?' is dynamic currency conversion, which often costs more than letting your card convert it.

A foreign transaction fee is an extra charge, often around 1-3% of the purchase, that some cards apply when you spend in a currency other than your own.

A ₱10,000 purchase made abroad with a 3% foreign transaction fee adds about ₱300 to your bill.

Phishing is a scam where fraudsters send fake messages or emails pretending to be a trusted company to trick you into revealing passwords or bank details.

A text claiming to be your bank asking you to 'verify' your account by clicking a link is a common phishing attempt.

Identity theft happens when someone steals your personal information, like your ID or account details, to impersonate you or make fraudulent transactions.

A criminal who gets hold of your ID and account number could open a ₱50,000 loan in your name without your knowledge.

Two-factor authentication adds a second verification step, like a one-time code sent to your phone, beyond just a password, to protect your accounts.

Even if a scammer learns your banking app password, two-factor authentication can block them without the one-time code sent to your phone.

A Ponzi scheme is a fraud that pays early investors with money from new investors, rather than real profits, and collapses once new money stops coming in.

A scheme promising 20% monthly returns on a ₱10,000 'investment' may just be paying old investors with new investors' cash until it collapses.

A pyramid scheme is a fraud where participants earn mainly by recruiting new members rather than selling any real product or service, and it collapses when recruitment dries up.

A 'business' that pays you ₱1,000 for every new member you recruit, but has no real product to sell, is a pyramid scheme.

A treasury bond is a long-term debt security issued by the government to raise funds, paying investors regular interest until it matures.

Buying ₱20,000 worth of treasury bonds might pay you interest every few months until the bond matures years later.

A circuit breaker is a temporary trading halt triggered automatically when prices fall too fast, giving markets a pause to prevent panic-driven crashes.

If an index plunges 10% in a single session, a circuit breaker might pause trading for a set time to let things settle.

Insolvency is the state of being unable to pay debts as they come due, whether for a person, a business, or even a bank.

A company with ₱2,000,000 in bills but only ₱500,000 in available cash is insolvent, even if it still owns valuable assets.

Growth investing means buying stocks of companies expected to expand sales and earnings faster than average, even if the share price already looks expensive today.

An investor might pay ₱500 for a fast-expanding tech company's share, betting its profits will grow quickly enough to justify the price.

Value investing means buying stocks that appear underpriced compared to the company's real worth, then waiting for the market to catch up.

A value investor might buy a stable company's shares at ₱40 when they believe it is really worth ₱60, then hold until the price rises.

The coupon rate is the fixed interest rate a bond promises to pay its holder each year, based on the bond's face value.

A ₱10,000 bond with a 6% coupon rate pays ₱600 in interest every year until it matures.

A credit rating is a grade given to a borrower, like a company or government, that shows how likely they are to repay their debts on time.

A government bond rated highly is seen as safer to lend to than one from a borrower with a weak credit rating.

Bond laddering means buying several bonds that mature at different times, so money becomes available in stages instead of all at once.

Instead of putting ₱300,000 into one 5-year bond, an investor might split it across bonds maturing in 1, 3, and 5 years.

NAVPU, or Net Asset Value Per Unit, is the price of one unit in a UITF, calculated by dividing the fund's total value by the number of units outstanding.

If a UITF's total assets are worth ₱50 million split into 1 million units, its NAVPU is ₱50 per unit.

Rebalancing means adjusting your portfolio back to its target mix of investments after some assets have grown or shrunk more than others.

If stocks grow to 70% of a portfolio meant to be 60% stocks and 40% bonds, rebalancing means selling some stock to buy bonds and restore the balance.

A joint account is a bank account shared by two or more people, such as spouses, who can each deposit, withdraw, and manage the money.

A married couple might open a joint account and both deposit ₱15,000 a month into it to cover shared household expenses.

An allowance is a regular, planned amount of money given to a child so they can practice budgeting, saving, and spending decisions on their own.

Giving a child ₱100 a week as an allowance lets them decide how much to spend now versus save for something bigger.

The debt snowball method means paying off your smallest debt first while making minimum payments on the rest, then rolling that payment into the next-smallest debt.

With debts of ₱5,000, ₱20,000, and ₱80,000, the snowball method tackles the ₱5,000 balance first for a quick win, then moves to the next.

The debt avalanche method means paying off the debt with the highest interest rate first while making minimum payments on the rest, saving the most money on interest overall.

Between a credit card at 36% and a loan at 10%, the avalanche method pays extra toward the credit card first since it costs the most.

A balance transfer moves debt from one credit card to another, often one with a lower or promotional interest rate, to reduce interest costs.

Moving a ₱50,000 balance from a card charging 3.5% monthly to one offering 0% for six months can save a lot in interest while you pay it down.

A last will and testament is a legal document stating how you want your money, property, and belongings distributed after you die.

A person might write a will leaving a ₱2,000,000 house to one child and ₱500,000 in savings split between two others.

Intestate succession is the legal process that decides who inherits a person's property when they die without a valid will, following a fixed order set by law.

If a parent dies without a will, intestate succession rules, not personal wishes, decide how the ₱1,500,000 estate is split among the surviving spouse and children.

A power of attorney is a legal document that lets you authorize someone else to make financial or medical decisions on your behalf if you become unable to.

A parent traveling abroad for months might grant a sibling power of attorney to manage bill payments and bank transactions at home.

Estate tax is a tax the government charges on the net value of a deceased person's property before it passes on to their heirs.

If a person leaves a net estate worth ₱5,000,000, their heirs may need to settle estate tax before the property can be legally transferred to their names.

Cash flow is the actual money moving in and out of a business or household, which can look very different from profit on paper if customers pay late.

A shop might show ₱100,000 in profit for the month but still struggle with cash flow if customers haven't paid their ₱80,000 in outstanding invoices yet.

An invoice is a document a seller sends a buyer requesting payment for goods or services provided, listing what's owed and when it's due.

A freelance designer sends a client a ₱25,000 invoice due in 15 days after finishing a logo project.

Rental yield measures the annual rental income a property generates as a percentage of what the property cost, helping investors compare returns across properties.

A ₱3,000,000 condo that rents for ₱15,000 a month, or ₱180,000 a year, has a rental yield of about 6%.

A REIT (Real Estate Investment Trust) lets investors buy shares in a company that owns income-producing properties, earning a piece of the rental income and gains without buying property directly.

Instead of saving millions to buy a mall, an investor can buy ₱10,000 worth of REIT shares and earn a portion of the rental income it collects.

Staking means locking up cryptocurrency to help operate and secure a blockchain network, earning rewards in return, similar to earning interest.

Locking up ₱20,000 worth of a cryptocurrency in staking might earn a few percent in additional coins over a year, though the coin's price can still swing.

Yield farming means moving cryptocurrency between different decentralized finance platforms to chase the highest available returns, which often carries higher risk than simple staking.

A crypto holder might shift ₱15,000 between several DeFi platforms each offering different reward rates, accepting extra risk for potentially higher returns.

A stablecoin is a cryptocurrency designed to hold a steady value by being pegged to something stable, like a currency such as the US dollar.

A stablecoin pegged to the US dollar aims to stay near $1 in value, unlike more volatile cryptocurrencies that can swing sharply in a day.

Credit utilization is the percentage of your available credit that you're currently using, and keeping it low generally helps your credit score.

Someone with a ₱100,000 credit limit who carries a ₱20,000 balance has a 20% credit utilization rate.

A hard inquiry happens when a lender checks your credit report after you apply for new credit, which can temporarily lower your credit score by a few points.

Applying for three new credit cards in one month triggers three hard inquiries, which may briefly dip your credit score.

The safe withdrawal rate is the percentage of your retirement savings you can withdraw each year with a low risk of running out of money over a long retirement.

Using a 4% safe withdrawal rate on a ₱5,000,000 retirement fund suggests withdrawing about ₱200,000 in the first year, adjusting for inflation after.

Coast FIRE is a stage of early retirement planning where you've saved enough that, left untouched, compound growth alone will reach your retirement goal by a normal retirement age, so you can stop adding new savings.

A 30-year-old who has already saved ₱3,000,000 might calculate that, growing untouched, it will reach their retirement target by 60, so they can "coast" and only cover current expenses.

A patronage refund is a share of a cooperative's profits returned to members based on how much business they did with the coop, not how many shares they own.

A member who bought ₱50,000 worth of goods from their coop in a year might receive a larger patronage refund than a member who bought only ₱5,000 worth.

An HMO (Health Maintenance Organization) is a private health plan, often provided by an employer, that covers medical costs at a network of accredited hospitals and clinics.

An employee with HMO coverage worth up to ₱150,000 a year can have a hospital confinement billed directly to the HMO instead of paying out of pocket.

Loss aversion is the tendency to feel the pain of losing money more strongly than the pleasure of gaining the same amount, which can lead to overly cautious or irrational money decisions.

An investor might hold on to a losing stock far too long just to avoid "locking in" a ₱10,000 loss, even when the money would do better elsewhere.

Anchoring bias is the tendency to rely too heavily on the first piece of information you see, like an original price, when making later financial decisions.

A buyer might think a jacket marked down from ₱5,000 to ₱3,000 is a great deal, anchoring on the original price rather than judging if ₱3,000 is truly worth it.

A balance sheet is a financial statement that lists what a company owns, what it owes, and what's left over for owners, all at a single point in time.

A small business's balance sheet might show ₱2,000,000 in assets and ₱800,000 in liabilities, leaving ₱1,200,000 in owner's equity.

An income statement shows a company's revenue, expenses, and resulting profit or loss over a specific period, like a month, quarter, or year.

A small shop's income statement for the year might show ₱1,500,000 in revenue and ₱1,200,000 in expenses, for ₱300,000 in profit.

MP2 Savings is a voluntary Pag-IBIG savings program in the Philippines that offers higher dividend rates than the regular Pag-IBIG fund in exchange for a 5-year commitment.

Setting aside ₱1,000 a month in MP2 Savings for five years lets a saver earn dividends that have historically outpaced regular savings accounts.

OWWA (Overseas Workers Welfare Administration) is a Philippine government agency that provides benefits like insurance, training, and repatriation assistance to registered overseas Filipino workers.

An OFW who pays the OWWA membership fee before deployment becomes eligible for benefits such as accident insurance and scholarship programs for their children.

A call option is a contract that gives the buyer the right, but not the obligation, to buy a stock at a set price (the strike price) before a certain date.

Paying ₱50 for a call option with an ₱110 strike price lets you buy the stock at ₱110 later, even if the market price jumps to ₱150.

A put option is a contract that gives the buyer the right, but not the obligation, to sell a stock at a set strike price before a certain date.

If you own a stock worth ₱200 and buy a put option with a ₱180 strike price, you're protected from losses below ₱180 even if the stock crashes.

The strike price is the fixed price at which an options contract allows the holder to buy (for a call) or sell (for a put) the underlying stock.

A call option with a ₱150 strike price only becomes worth exercising if the stock trades above ₱150.

The options premium is the price you pay upfront to buy an options contract, separate from the strike price.

You might pay a ₱30 premium per share for an option, which you lose entirely if you never exercise the contract.

Implied volatility is the market's forecast of how much a stock's price is likely to swing, and it's a key factor in how expensive an option's premium is.

Ahead of a big earnings announcement, implied volatility often rises, making options on that stock more expensive.

Delta measures how much an option's price is expected to move for every ₱1 move in the underlying stock's price.

An option with a delta of 0.50 would be expected to gain about ₱0.50 in value if the stock rises by ₱1.

The expiration date is the last day an options contract is valid; after that, it becomes worthless if not exercised.

An option expiring on the last Friday of the month is worthless the following Monday if it wasn't exercised in time.

An option is in-the-money when exercising it right now would be profitable, such as a call whose strike price is below the stock's current market price.

A call option with a ₱90 strike price is in-the-money if the stock is currently trading at ₱100.

An option is out-of-the-money when exercising it right now would not be profitable, meaning it has no intrinsic value at that moment.

A call option with a ₱120 strike price is out-of-the-money if the stock is only trading at ₱100.

A covered call is a strategy where you sell a call option on a stock you already own, collecting the premium as extra income in exchange for capping your potential upside.

An investor holding shares worth ₱10,000 might sell a call option for a ₱500 premium, earning income but agreeing to sell the shares if the price rises past the strike.

The yield curve is a line plotting interest rates of bonds with different maturities, from short-term to long-term, and its shape offers clues about economic expectations.

When short-term bonds yield more than long-term ones, the yield curve is described as inverted, which investors watch closely as a possible recession signal.

Duration measures how sensitive a bond's price is to changes in interest rates, expressed in years; the longer the duration, the more the price swings when rates move.

A bond with a duration of 7 years will typically fall about 7% in price if interest rates rise by 1 percentage point.

A credit spread is the difference in yield between a bond that carries more default risk and a safer benchmark bond, like a government bond of the same maturity.

If a corporate bond yields 7% while a similar government bond yields 5%, the credit spread is 2 percentage points, reflecting the corporate bond's extra risk.

The maturity date is the day a bond's issuer must repay the full face value to the bondholder, ending the loan.

A bond bought in 2026 with a 10-year maturity date will return your ₱50,000 principal in 2036.

Yield to maturity (YTM) is the total annual return you'd earn on a bond if you held it until it matures, factoring in its price, coupon payments, and time left.

A bond bought below face value might have a YTM higher than its coupon rate, since you'll also gain from the price rising to face value at maturity.

Face value, also called par value, is the amount a bond will be worth at maturity and the base on which coupon interest payments are calculated.

A bond with a ₱10,000 face value and a 5% coupon rate pays ₱500 a year, regardless of what the bond's market price does in between.

A zero-coupon bond pays no periodic interest; instead, it's sold at a discount to its face value and pays the full face value at maturity.

You might buy a zero-coupon bond for ₱8,000 today that pays ₱10,000 at maturity, earning ₱2,000 without any interim interest checks.

A callable bond gives the issuer the right to repay the bond early, before its maturity date, usually when interest rates have dropped and refinancing is cheaper for them.

A company might call back its 8% bonds early if it can now borrow at 5% instead, leaving bondholders to reinvest at the lower rate.

A corporate bond is a debt security issued by a company, rather than a government, to raise funds, generally paying higher interest than government bonds to compensate for extra risk.

A company might issue bonds paying 7% a year, higher than a government bond's 5%, because it carries more default risk.

A Retail Treasury Bond (RTB) is a Philippine government bond sold in smaller denominations directly to individual investors, often through banks, making it accessible to everyday savers.

A saver might buy ₱5,000 worth of RTBs through their bank, earning fixed interest every quarter until the bond matures.

EBITDA stands for Earnings Before Interest, Taxes, Depreciation, and Amortization, and it's a way to gauge a company's core operating profit without the noise of financing and accounting choices.

A company with ₱10,000,000 in EBITDA is generating that much in operating profit before accounting for loan interest, taxes, and asset write-downs.

Free cash flow is the cash a company generates from its operations after paying for the equipment and investments needed to keep the business running.

A company with ₱5,000,000 in operating cash flow that spends ₱1,000,000 on new equipment has ₱4,000,000 in free cash flow left over.

Working capital is the difference between a company's current assets and current liabilities, showing whether it has enough short-term resources to cover its near-term obligations.

A business with ₱3,000,000 in current assets and ₱2,000,000 in current liabilities has ₱1,000,000 in working capital to fund day-to-day operations.

Goodwill is an intangible asset recorded when a company buys another business for more than the fair value of its identifiable assets, reflecting things like brand reputation or customer loyalty.

If a company buys a smaller brand for ₱50,000,000 but its identifiable assets are only worth ₱35,000,000, the extra ₱15,000,000 gets recorded as goodwill.

The current ratio compares a company's current assets to its current liabilities, giving a quick snapshot of whether it can cover short-term obligations.

A company with ₱2,000,000 in current assets and ₱1,000,000 in current liabilities has a current ratio of 2, meaning it has twice what it needs to cover near-term bills.

The quick ratio, also called the acid-test ratio, measures a company's ability to pay short-term obligations using only its most liquid assets, excluding inventory.

A retailer might have a healthy current ratio but a weak quick ratio if most of its current assets are sitting in unsold inventory rather than cash.

The debt-to-equity ratio compares how much a company relies on borrowed money versus money from its owners, calculated by dividing total debt by shareholders' equity.

A company with ₱4,000,000 in debt and ₱2,000,000 in shareholders' equity has a debt-to-equity ratio of 2, meaning it uses twice as much borrowed money as owner capital.

Gross margin is the percentage of revenue left after subtracting the direct cost of producing goods or services, before other expenses like rent or marketing are deducted.

A company with ₱1,000,000 in sales and ₱600,000 in production costs has a gross margin of 40%, since ₱400,000 remains before other expenses.

Operating margin measures the percentage of revenue left after subtracting both production costs and regular operating expenses like salaries and rent, before interest and taxes.

A company with ₱1,000,000 in revenue and ₱150,000 in operating profit has an operating margin of 15%.

Retained earnings are the portion of a company's profits kept and reinvested in the business instead of being paid out to shareholders as dividends.

A company earning ₱2,000,000 in profit that pays ₱500,000 in dividends keeps the remaining ₱1,500,000 as retained earnings.

The GDP deflator is a measure of overall price changes across everything a country produces, used to strip out inflation and see how much economic growth is 'real.'

If a country's GDP grew 8% in peso terms but the GDP deflator shows 5% price inflation, the economy's real growth was closer to 3%.

Quantitative easing is when a central bank buys large amounts of bonds to pump money into the economy, aiming to lower interest rates and encourage borrowing and spending.

During a slowdown, a central bank might buy billions worth of government bonds to keep borrowing costs low and support economic activity.

The current account tracks a country's trade in goods, services, and income with the rest of the world, showing whether it's earning more from abroad than it's spending.

A country that exports more electronics than it imports in oil and consumer goods runs a current account surplus.

A trade deficit happens when a country imports more goods and services in value than it exports, meaning more money flows out than comes in from trade.

If a country imports ₱2 trillion worth of goods but only exports ₱1.5 trillion, it runs a ₱500 billion trade deficit.

The Consumer Price Index (CPI) tracks the average change in prices of a fixed basket of everyday goods and services, and it's the most common way inflation gets measured.

If the CPI basket cost ₱10,000 last year and ₱10,300 this year, that 3% increase reflects the inflation rate over that period.

Stagflation is a rare and painful economic combination of slow or stagnant growth, high unemployment, and high inflation all happening at the same time.

An economy with rising prices at the grocery store but also rising joblessness and a shrinking GDP would be described as facing stagflation.

The business cycle is the natural, recurring pattern of economic expansion and contraction that economies go through over time, moving between growth, peak, downturn, and recovery.

An economy might grow for several years, peak, slide into a recession, and then recover, completing one full business cycle.

Purchasing power parity (PPP) is a way of comparing different countries' currencies by looking at how much the same basket of goods costs in each place, rather than just the exchange rate.

If a basket of goods costs more in dollars abroad than the peso equivalent at home, PPP suggests the peso has more real purchasing power than the exchange rate implies.

Hyperinflation is an extreme, out-of-control rise in prices, often exceeding 50% a month, where money loses value so fast that people rush to spend it before it's worth even less.

In a hyperinflation crisis, a loaf of bread that cost 10 units of currency in the morning might cost 15 by the afternoon.

A budget deficit happens when a government spends more money than it collects in revenue during a given period, typically financed by borrowing.

If a government collects ₱3 trillion in revenue but spends ₱3.5 trillion, it runs a ₱500 billion budget deficit that year.

The debt-to-income ratio compares how much of your monthly income goes toward debt payments, and lenders use it to judge how much more you can safely borrow.

If you earn ₱40,000 a month and pay ₱12,000 toward loans and credit cards, your debt-to-income ratio is 30%.

An amortization schedule is a table showing each loan payment over time, broken down into how much goes to interest and how much reduces the principal.

Early in a 20-year mortgage's amortization schedule, most of each ₱25,000 payment covers interest, with only a small part chipping away at the principal.

APY (Annual Percentage Yield) shows the real annual return on savings once compounding is factored in, making it higher than the stated interest rate if interest compounds more than once a year.

A savings account with a 5% interest rate that compounds monthly might have an APY closer to 5.12%, reflecting the extra boost from compounding.

The Rule of 72 is a quick shortcut for estimating how many years it takes an investment to double, by dividing 72 by the annual growth rate.

At an 8% annual return, dividing 72 by 8 suggests your money would roughly double in about 9 years.

A cost-of-living adjustment (COLA) is an increase to wages, pensions, or benefits meant to help recipients keep pace with rising prices.

If inflation runs at 4% for the year, an employer might apply a matching COLA to salaries so workers' real buying power doesn't shrink.

A line of credit is a flexible loan that lets you borrow up to a set limit, repay, and borrow again, paying interest only on the amount you actually use.

With a ₱100,000 line of credit, you might draw ₱30,000 for an emergency, pay interest only on that ₱30,000, and still have ₱70,000 available.

A secured loan is backed by collateral, like a car or house, which the lender can seize if you fail to repay, typically allowing lower interest rates in exchange.

A car loan is a secured loan because the lender can repossess the car worth ₱600,000 if payments stop.

An unsecured loan isn't backed by any specific collateral, relying instead on your creditworthiness, which usually means higher interest rates to compensate the lender for extra risk.

A personal loan for ₱50,000 with no collateral attached is an unsecured loan, often carrying a higher interest rate than a car loan of the same amount.

A credit limit is the maximum amount a lender allows you to borrow on a credit card or line of credit at any given time.

If your credit card has a ₱50,000 credit limit and you've charged ₱20,000, you have ₱30,000 left to spend before hitting the cap.

Loan tenor refers to the length of time you have to fully repay a loan, from the day it's disbursed to the final payment date.

Choosing a 5-year tenor instead of a 3-year tenor on a ₱300,000 loan lowers your monthly payment but usually means paying more total interest.

Correlation measures how closely two investments move in relation to each other, ranging from -1 (moving in exact opposite directions) to +1 (moving perfectly together).

If two stocks have a correlation of 0.9, they tend to rise and fall together, offering little diversification benefit if you hold both.

Beta measures how much a stock tends to move relative to the overall market; a beta above 1 means it's typically more volatile than the market, while below 1 means less.

A stock with a beta of 1.5 would be expected to rise or fall about 15% if the broader market moves 10%.

Alpha measures how much an investment's return beat (or lagged) a benchmark, after adjusting for the risk it took on, often used to judge a fund manager's skill.

A fund that returned 12% when its benchmark returned 9%, after adjusting for risk, is said to have generated 3% of alpha.

Standard deviation measures how much an investment's returns typically swing above or below its average, making it a common way to gauge volatility and risk.

A fund with an average return of 8% and a standard deviation of 15% could reasonably swing well above or below that average in any given year.

The Sharpe ratio measures how much extra return an investment earned for each unit of risk it took on, helping compare whether returns were worth the volatility.

Between two funds with similar returns, the one with a higher Sharpe ratio delivered those returns with less bumpy volatility along the way.

Buy-and-hold is an investing strategy where you purchase assets and keep them for the long term, ignoring short-term market swings rather than trying to time trades.

An investor who bought an index fund a decade ago and never sold, riding out several downturns along the way, is practicing buy-and-hold investing.

An asset class is a broad category of investments that share similar characteristics and behave similarly in the market, such as stocks, bonds, real estate, or cash.

A portfolio spread across stocks, bonds, and real estate is diversified across multiple asset classes, not just individual securities.

A dividend reinvestment plan (DRIP) automatically uses your cash dividends to buy more shares of the same stock or fund, instead of paying the cash out to you.

Instead of receiving ₱2,000 in cash dividends, a DRIP investor automatically uses that ₱2,000 to buy more shares, compounding their stake over time.

Sector rotation is an investing strategy of shifting money between different industries, like technology or healthcare, based on where investors expect the economy or market cycle to favor next.

An investor might rotate out of consumer discretionary stocks and into utilities when they expect an economic slowdown ahead.

Market timing means trying to buy and sell investments based on predictions of future price movements, aiming to buy low and sell high by forecasting short-term swings.

An investor who sells all their stocks because they predict a crash, then tries to buy back in at the 'bottom,' is attempting market timing.

A blockchain is a shared, tamper-resistant digital ledger that records transactions across many computers, forming the technology behind cryptocurrencies like Bitcoin.

When someone sends cryptocurrency, that transaction gets recorded on the blockchain, where it's verified and stored permanently across a network of computers.

A crypto wallet is software or hardware that stores the keys needed to access and manage your cryptocurrency, rather than the coins themselves, which live on the blockchain.

Losing the private key to your crypto wallet can mean permanently losing access to your cryptocurrency, since there's no password reset option.

DeFi, short for decentralized finance, refers to financial services like lending, borrowing, and trading built on blockchain networks, aiming to operate without traditional banks or brokers as middlemen.

Instead of depositing money in a bank to earn interest, a DeFi user might lend cryptocurrency directly to other users through a blockchain platform.

A gas fee is the cost paid to process a transaction on certain blockchain networks, compensating the computers that verify and record it.

Sending cryptocurrency during a busy period might cost a higher gas fee, sometimes more than the value of a small transaction itself.

A smart contract is a self-executing program stored on a blockchain that automatically carries out agreed terms once its conditions are met, without needing a middleman.

A smart contract might automatically release payment to a seller the moment a buyer's cryptocurrency deposit is confirmed on the blockchain.

An NFT (non-fungible token) is a unique, blockchain-based digital certificate of ownership for a specific item, like digital art, that can't be exchanged one-for-one with another NFT the way currency can.

Someone might pay ₱100,000 for an NFT representing ownership of a unique piece of digital art, even though the image itself could be copied freely online.

Cold storage means keeping cryptocurrency keys on a device disconnected from the internet, like a hardware wallet, to protect them from online hacking.

An investor holding a large amount of cryptocurrency might move it to a cold storage device instead of leaving it on an exchange vulnerable to hacks.

A seed phrase is a series of random words that acts as the master backup key to a crypto wallet, letting you restore access to your funds if the wallet is lost or damaged.

Writing down a 12-word seed phrase on paper, instead of storing it digitally, is a common way to keep it safe from hackers.

Tokenization is the process of representing ownership of a real-world or digital asset, like real estate or art, as a digital token on a blockchain, making it easier to divide and trade.

A large building could be tokenized into smaller digital shares, letting investors buy a small stake instead of needing the full purchase price.

A CBDC (central bank digital currency) is a digital form of a country's official currency, issued and backed directly by its central bank, distinct from decentralized cryptocurrencies.

Unlike Bitcoin, a peso-based CBDC would be issued directly by the central bank and carry the same official backing as physical cash.

An insurance premium is the amount you pay, usually monthly or annually, to keep an insurance policy active and receive its coverage.

Paying a ₱15,000 annual premium for a health insurance policy keeps your coverage active for the year, even if you never file a claim.

A deductible is the amount you must pay out of pocket before your insurance starts covering the rest of a claim.

With a ₱10,000 deductible on a car insurance policy, you'd pay the first ₱10,000 of repair costs yourself before insurance covers the remainder.

A policy rider is an optional add-on to an insurance policy that provides extra coverage or benefits beyond the standard terms, usually for an additional cost.

Adding a critical illness rider to a life insurance policy for an extra ₱2,000 a year provides a payout if you're diagnosed with a covered illness.

Underwriting is the process an insurer uses to evaluate an applicant's risk, such as health or driving history, to decide whether to offer coverage and at what price.

Before approving a life insurance policy, an insurer's underwriting process might review your medical history and lifestyle to set your premium.

An actuary is a professional who uses statistics and math to calculate risk, helping insurance companies price policies and set aside enough money to cover future claims.

An actuary might analyze years of claims data to determine that a certain age group should pay a higher premium for life insurance.

A beneficiary is the person or entity designated to receive the payout from an insurance policy, retirement account, or estate when the policyholder dies.

A father might name his two children as beneficiaries on his ₱1,000,000 life insurance policy, splitting the payout evenly between them.

Term life insurance provides coverage for a set period, like 10 or 20 years, paying a death benefit only if the insured dies during that term, with no cash value if they outlive it.

A 20-year term life policy with a ₱2,000,000 payout only pays out if the policyholder passes away within those 20 years; otherwise, the coverage simply ends.

Whole life insurance provides coverage for the insured's entire life and builds a cash value over time that the policyholder can borrow against or withdraw.

Unlike a term policy, a whole life policy stays active for life and might build up ₱300,000 in cash value after many years of premiums.

The sum insured is the maximum amount an insurance policy will pay out in the event of a covered loss, death, or claim.

A health insurance policy with a ₱500,000 sum insured will cover eligible medical expenses only up to that ₱500,000 limit per year.

An insurance claim is a formal request made to an insurer asking for payment or coverage after a loss, accident, illness, or other event covered by the policy.

After a car accident causing ₱80,000 in damage, the driver files an insurance claim to have the insurer cover the repair costs.

The capitalization rate, or cap rate, measures a real estate investment's yearly income relative to its price, helping investors compare the potential returns of different properties.

A rental property worth ₱5,000,000 that generates ₱400,000 in annual net income has a cap rate of 8%.

An appraisal is a professional assessment of a property's current market value, often required by lenders before approving a mortgage.

Before approving a home loan, a bank might require an appraisal confirming the ₱4,000,000 house is actually worth that much.

The loan-to-value (LTV) ratio compares the size of a mortgage loan to the appraised value of the property, showing how much of the purchase is financed versus paid upfront.

A ₱3,600,000 loan on a ₱4,000,000 home has an LTV ratio of 90%, meaning the buyer put down only 10% upfront.

Foreclosure is the legal process where a lender repossesses and sells a property because the borrower failed to keep up with mortgage payments.

After missing payments for months on a ₱3,000,000 mortgage, a homeowner may face foreclosure, losing the property to the bank.

Condominium dues are regular fees paid by unit owners to cover the shared costs of maintaining a condo building, like security, utilities, and common area upkeep.

A condo owner might pay ₱3,500 a month in association dues on top of their mortgage, covering the building's security guards and elevator maintenance.

A lease agreement is a legal contract between a landlord and tenant that sets the terms of renting a property, including rent amount, duration, and responsibilities.

A 1-year lease agreement might require a tenant to pay ₱15,000 monthly rent plus a 2-month security deposit before moving in.

A title deed is the legal document proving ownership of a property, and transferring it is a key step in finalizing any real estate sale.

After fully paying for a house, the buyer isn't the legal owner until the title deed is officially transferred into their name.

Earnest money is a deposit a buyer puts down to show serious intent to purchase a property, usually credited toward the final price if the sale goes through.

A buyer might put down ₱200,000 in earnest money to reserve a ₱4,000,000 house while financing details are finalized.

Zonal value is the government-assessed value of land in a specific area in the Philippines, used by the Bureau of Internal Revenue as a baseline for computing property-related taxes.

Even if a lot sold for ₱2,000,000, taxes might be computed using its ₱2,500,000 zonal value if that figure is higher.

An easement is a legal right allowing someone to use part of another person's property for a specific purpose, such as accessing a road or running utility lines.

A property might carry an easement letting a neighbor cross a corner of the lot to reach the main road.

The BSP (Bangko Sentral ng Pilipinas) is the central bank of the Philippines, responsible for setting monetary policy, controlling inflation, and supervising the country's banks.

When the BSP raises its policy interest rate, banks across the Philippines typically follow by raising their own loan and deposit rates.

PERA (Personal Equity and Retirement Account) is a voluntary, tax-advantaged retirement savings account available to qualified Filipinos, allowing contributions to be invested for the long term.

Contributing to a PERA account lets a saver invest for retirement while enjoying tax incentives not available on a regular savings account.

A UITF (Unit Investment Trust Fund) is a pooled investment offered by banks in the Philippines, where many investors' money is combined and professionally managed in stocks, bonds, or a mix of both.

Instead of picking individual stocks, an investor might put ₱20,000 into a bank's equity UITF and let professional fund managers handle the investing.

GSIS (Government Service Insurance System) is the Philippine agency that provides social insurance, including pensions and loans, to government employees, similar to how SSS serves private-sector workers.

A public school teacher's monthly salary deduction goes toward GSIS contributions, which fund their eventual retirement pension.

The PSEi (Philippine Stock Exchange index) tracks the combined performance of 30 of the largest and most actively traded companies listed on the Philippine Stock Exchange.

If the PSEi rises 2% in a day, it means those 30 major listed companies gained about 2% in value on average, weighted by size.

The BIR (Bureau of Internal Revenue) is the Philippine government agency responsible for collecting national taxes, including income tax, and enforcing tax laws.

Every April, Filipino taxpayers file their annual income tax returns with the BIR to report and settle what they owe.

A TIN (Taxpayer Identification Number) is a unique number issued by the BIR to individuals and businesses in the Philippines to track their tax records and filings.

You'll need to provide your TIN when starting a new job so your employer can properly report and withhold your income tax.

Real property tax is an annual tax owed to local government by owners of land, buildings, and other real estate, based on the property's assessed value.

A homeowner might owe ₱15,000 a year in real property tax to their city, based on the assessed value of their house and lot.

4Ps (Pantawid Pamilyang Pilipino Program) is a Philippine government conditional cash transfer program that gives cash grants to poor families in exchange for meeting conditions like keeping children in school and attending health checkups.

A qualified family might receive a monthly cash grant under 4Ps, as long as their children maintain a set attendance rate in school.

A cedula, or Community Tax Certificate, is a basic identification document issued by local governments in the Philippines, often required for notarizing documents or transacting with local offices, and comes with a small community tax.

Before having a document notarized, you may be asked to present a cedula, which you can get from your city or municipal hall for a small fee based on your income.