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Laddering - Creating a CD or bond portfolio with a combination of assets with different maturity dates. As each bond or CD matures, the proceeds are reinvested at the longest time interval to maintain the ladder.
Leverage - The use of borrowed money to make an investment (e.g., a home mortgage).
Liability - Money owed by an individual or business that decreases net worth.
Life Insurance - A contract with a life insurance company where a policyholder pays a premium in exchange for an amount paid to his or her beneficiaries in the event of death. Life insurance is not needed by everyone but should be purchased by anyone with financial dependents (e.g., children).
Liquidity - The ability to convert an asset to cash quickly without loss of value.
Long-Term Care Insurance - Type of insurance that covers the cost of support services (e.g., home health care and nursing home care) when someone is unable to perform basic activities of daily living such as bathing, eating, and dressing.
Updated:E.J.B.
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