A Retirement Investing Newsletter
Senior Savvy

Savvy Resources
Glossary
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Present Value
The present value is the current value of an
asset to be received in the future, or a series
of payments evaluated at a discount rate,
technically; PV.

Future Value
The future value is the amount to which the
present value or a series of payments will
increase over time when compounded at a
given interest rate, technically; FV.

Payment
A series of deposits or receipts occuring over
a period of time, technically; PMT.

Annuities
A series of payments, deposits or receipts
received from savings or applied to accumulated
assets, technically; PMT.

Interest
An amount earned for investing, or paid for the
loan of money, expressed as a percentage of the
original amount, technically; I/YR.

Period
The time when interest is calculated.

Intraperiod
The number periods in one calendar year,
technically; P/YR.

Total Periods
The sum of all the periods, technically; N.

Time Period
The length of time interest is paid or earned
on an asset.

Years
The total number of years in a calculation.

Ordinary Annuity
Payments made or received at the end of
a period.

Annuity Due
Payments made or received at the beginning
of a period.

Discount Rate
The process of a reverse asset calculation
(future value to present value), where the
interest is referred to as the discount interest
rate, also know as the required rate of return.

Simple interest
When interest is added to the principal only.

Compound interest
When interest is added to simple interest, or
the process of adding interest to previous
interest plus principal calculations. Also known
as compounding.

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