Naz Financial

A Personal Financial Blog from Naz Miller

When a member starts to take their pension before the normal retirement date of the scheme.

A pension provided (sponsored) by an employer for its employees. Company pension schemes can be defined benefit schemes (final salary schemes) or defined contribution schemes (money purchase schemes).

Shares or stocks that represent a share of the ownership of a company. Equities can provide regular payments (dividends) and their price changes as the value of the company changes.
Over the longer term, equities can offer greater growth potential than many other asset types. However, the value of the equities can go up and down a lot and tend to carry a higher risk than corporate or government bonds or money market instruments.
See my blogs on the subject of equities.

Schemes that allow homeowners to release cash from the value of their property.
There are two types of equity release scheme. A lifetime mortgage scheme allows you to raise money against the value of your property while you still own it. A home reversion scheme lets you sell all or part of your home to a reversion company. The options for releasing the money are not standardised across the industry and depend upon the specific terms of each product.

Ethical investment funds aim to make socially responsible investments. They won’t invest in companies with interests in socially unacceptable markets or produce harmful products or by-products, such as high levels of environmental pollution. What is ‘ethical’, of course can vary.

This is an investment fund, the units of which are traded on a specific stock exchange. Exchange-traded funds may hold a range of assets, like stocks, bonds or commodities. Most will track an index, such as the FTSE 100 or the S&P 500.

Glossary of Personal Financial Terms

AAA Rating

In short, AAA ratings (‘triple-A‘ ratings) are the highest credit rating available for an investment, such as a bond or company.

AAA ratings are issued to investment-grade debt that has a high level of creditworthiness with the strongest capacity to repay investors.

Similarly, the AA+ rating is issued by S&P (Standard and Poor) and is similar to the Aa1 rating issued by Moody’s. It comes with very low credit risk and indicates the issuer has a strong capacity to repay.