Glossary

75 terms you'll meet across our calculators, defined in plain English.

Finance

401(k): An employer-sponsored retirement account that allows tax-deferred contributions, often with employer matching.
Amortization: The process of spreading out a loan into a series of fixed payments over time. Each payment covers both interest and principal.
Amortization Schedule: A table showing each loan payment broken down into interest and principal portions, along with the remaining balance after each payment.
APR (Annual Percentage Rate): The total yearly cost of borrowing, including interest and fees, expressed as a percentage of the loan amount.
APY (Annual Percentage Yield): The effective annual rate of return accounting for compound interest. Higher than the nominal interest rate when compounding occurs more than once per year.
Cap Rate (Capitalization Rate): A real estate metric calculated as net operating income ÷ property value. Used to estimate potential return on investment property.
Capital Gains: Profit from selling an asset for more than its purchase price. Short-term and long-term capital gains are taxed at different rates.
Compound Interest: Interest calculated on both the initial principal and the accumulated interest from previous periods. Accelerates growth over time.
Debt-to-Income Ratio (DTI): Monthly debt payments divided by gross monthly income. Lenders use DTI to assess borrowing risk.
Depreciation: The decrease in an asset's value over time due to wear, age, or obsolescence. Used in tax calculations and financial reporting.
Diversification: Spreading investments across different asset types to reduce risk. A diversified portfolio balances high- and low-risk assets.
Equity: The difference between the market value of an asset and the amount owed on it. For a home, equity = home value minus mortgage balance.
Escrow: A neutral third-party account that holds funds during a real estate transaction or for paying property taxes and insurance.
Future Value (FV): The value of an asset or investment at a specified date in the future, accounting for growth or interest.
Inflation: The rate at which the general level of prices rises, reducing purchasing power over time. Measured by indices like CPI.
IRA (Individual Retirement Account): A personal retirement account with tax advantages. Traditional IRAs offer tax-deferred growth; Roth IRAs offer tax-free withdrawals.
Liquidity: How quickly an asset can be converted to cash without significant loss of value. Cash is the most liquid asset.
Loan-to-Value Ratio (LTV): The loan amount divided by the appraised property value. Higher LTV typically means higher interest rates and requires PMI.
Marginal Tax Rate: The tax rate applied to the last dollar of income. In progressive tax systems, different portions of income are taxed at different rates.
Net Worth: Total assets minus total liabilities. A snapshot of financial health at a given point in time.
PMI (Private Mortgage Insurance): Insurance required by lenders when the down payment is less than 20% of the home price. Protects the lender, not the borrower.
Present Value (PV): The current worth of a future sum of money, discounted at a specific rate. The foundation of discounted cash flow analysis.
Principal: The original sum of money borrowed or invested, excluding any interest or earnings.
Refinancing: Replacing an existing loan with a new one, typically to secure a lower interest rate, change loan terms, or access equity.
Return on Investment (ROI): A measure of profitability calculated as (gain − cost) ÷ cost, usually expressed as a percentage.
RMD (Required Minimum Distribution): The minimum amount you must withdraw annually from tax-deferred retirement accounts starting at age 73 (as of 2024).
Roth vs. Traditional: Roth accounts use after-tax dollars and allow tax-free withdrawals; traditional accounts use pre-tax dollars but withdrawals are taxed as income.
Time Value of Money (TVM): The principle that money available today is worth more than the same amount in the future due to its earning potential.

Health & Fitness

BAC (Blood Alcohol Content): The percentage of alcohol in your bloodstream. Used to measure intoxication levels and legal driving limits.
BMI (Body Mass Index): A weight-for-height index calculated as weight (kg) ÷ height² (m²). Used to screen for weight categories that may indicate health risks.
BMR (Basal Metabolic Rate): The number of calories your body needs at complete rest to maintain vital functions like breathing, circulation, and cell production.
Body Fat Percentage: The proportion of fat mass to total body weight. Measured via calipers, bioelectrical impedance, DEXA scans, or circumference methods.
BSA (Body Surface Area): A measurement used in medical dosing, calculated from height and weight. Common formulas include Mosteller and Du Bois.
Due Date (EDD): The estimated date of delivery, typically calculated as 280 days (40 weeks) from the first day of the last menstrual period.
eGFR (Estimated Glomerular Filtration Rate): A blood test-based estimate of kidney function. Lower values may indicate chronic kidney disease.
Heart Rate Zone: A percentage range of your maximum heart rate used to target specific exercise intensities: fat burn, cardio, and peak zones.
Lean Body Mass (LBM): Total body weight minus fat mass. Includes muscle, bone, organs, and water. Used to calculate protein needs and metabolic rate.
Macronutrients (Macros): Nutrients required in large amounts: carbohydrates (4 cal/g), protein (4 cal/g), and fat (9 cal/g). The foundation of dietary planning.
One-Rep Max (1RM): The maximum weight you can lift for a single repetition of an exercise. Used to structure strength training programs.
TDEE (Total Daily Energy Expenditure): Total calories burned per day, including BMR plus physical activity and the thermic effect of food. Used for weight management.

Mathematics

Combination: A selection of items where order does not matter. nCk = n! ÷ (k! × (n−k)!).
Confidence Interval: A range of values that likely contains the population parameter with a specified level of confidence (typically 95%).
Exponent: A number indicating how many times a base is multiplied by itself. For example, 2³ = 2 × 2 × 2 = 8.
Greatest Common Factor (GCF): The largest number that divides evenly into two or more numbers. Also called the greatest common divisor (GCD).
Half-Life: The time required for a quantity to reduce to half its initial value. Used in radioactive decay, pharmacology, and exponential decay models.
Least Common Multiple (LCM): The smallest positive number that is a multiple of two or more numbers. Used when finding common denominators.
Logarithm: The inverse operation of exponentiation. log_b(x) answers "what exponent makes b equal x?"
Mean (Average): The sum of all values divided by the count of values. The most common measure of central tendency.
Median: The middle value when data is sorted in order. Less affected by outliers than the mean.
P-Value: The probability of obtaining results at least as extreme as observed, assuming the null hypothesis is true. Used in hypothesis testing.
Permutation: An arrangement of items where order matters. nPk = n! ÷ (n−k)!.
Prime Factorization: Breaking down a number into its prime factors. For example, 12 = 2 × 2 × 3. Every number has a unique prime factorization.
Pythagorean Theorem: In a right triangle: a² + b² = c², where c is the hypotenuse. The foundation of distance calculations in geometry.
Quadratic Equation: An equation of form ax² + bx + c = 0. Solutions found via the quadratic formula: x = (−b ± √(b² − 4ac)) ÷ 2a.
Scientific Notation: A way of writing very large or very small numbers as a × 10ⁿ, where 1 ≤ a < 10. For example, 0.000001 = 1 × 10⁻⁶.
Standard Deviation: A measure of how spread out numbers are from the mean. A low standard deviation means values cluster close to the mean.
Variance: The average of squared differences from the mean. The square root of variance gives the standard deviation.
Z-Score: The number of standard deviations a data point is from the mean. Used to compare values from different distributions.

Engineering

Flow Rate: The volume of fluid passing through a point per unit time. Measured in GPM (gallons per minute) or L/min.
Gear Ratio: The ratio of the number of teeth on two meshing gears. Determines torque multiplication and speed reduction in mechanical systems.
MTBF (Mean Time Between Failures): The average time a system operates between failures. Used in reliability engineering and maintenance planning.
Ohm's Law: The relationship between voltage (V), current (I), and resistance (R): V = I × R. The fundamental law of electrical circuits.
Rate Limiting: Controlling the rate of traffic or requests to a system to prevent overload. Common in API design and network management.
Resistor: An electrical component that opposes current flow. Resistance is measured in ohms (Ω) and follows Ohm's Law.
Voltage Drop: The reduction in voltage as electricity travels through a conductor. Excessive voltage drop causes inefficient operation and heat.
Wire Gauge (AWG): The American Wire Gauge standard for measuring wire diameter. Lower gauge numbers mean thicker wires with less resistance.

Everyday & DIY

Coverage Area: The total area a material can cover — used for paint, tile, mulch, and other home improvement materials.
Net Working Days: Business days excluding weekends and holidays. Used for project timelines, shipping estimates, and contract terms.
Square Footage: The area of a space measured in square feet. Calculated as length × width for rectangular rooms.

E-Commerce

Break-Even Point: The level of sales at which total revenue equals total costs. Below break-even = loss; above = profit.
CAC (Customer Acquisition Cost): Total cost of acquiring a new customer, including marketing and sales expenses. CAC = total acquisition costs ÷ new customers.
COGS (Cost of Goods Sold): The direct cost of producing or purchasing goods sold, including materials and labor. Used to calculate gross profit.
LTV (Lifetime Value): The total revenue a business can expect from a single customer over their entire relationship. LTV > 3× CAC is considered healthy.
Profit Margin: The percentage of revenue that becomes profit. Gross margin = (revenue − COGS) ÷ revenue. Net margin accounts for all expenses.
ROAS (Return on Ad Spend): Revenue generated per dollar spent on advertising. ROAS = revenue ÷ ad spend. A key metric for marketing campaigns.