guide to lease buy invest

Immediate annuity
You buy an immediate annuity by paying the full cost of the annuity contract at the time of purchase. The annuity then begins paying income right away or within a year at the latest. Immediate annuities appeal to people who want to convert a large sum of money to a source of regular income, either for their own retirement or for a beneficiary.

Immediate annuity | Details |

Incentive stock option (ISO)
This compensation plan, created by the Economic Recovery Tax Act of 1981 (ERTA), lets executives receive options to purchase company stock at a deep discount and exercise those options free of income tax until they sell the shares.

Incentive stock option (ISO) | Details |

Income annuity
An income annuity, sometimes called an immediate annuity, pays an annual income, usually in monthly installments. The amount you receive is determined by the purchase price of the contract, your age (and the age of your beneficiary if you name one), the term over which the annuity will be paid, and the specific details of the contract.

Income annuity | Details |

Income fund
Income funds are mutual funds whose investment objective is to produce current income rather than long-term growth, typically by investing in bonds. The amount of income a fund may generate is related to the risk posed by the investments that the fund makes.A fund that buys lower-grade bonds will often pay more income than a fund buying investment-grade bonds. But under certain market conditions, the riskier fund may pay less or put your principal, or investment amount, at risk.

Income fund | Details |

Income in respect of a decedent
Any income your beneficiary receives after your death that would have gone to you if you were still alive is described as income in respect of a decedent. One example is the income your beneficiary gets as a minimum required distribution from your 401(k) or IRA. In this case, your beneficiary pays tax on that income at his or her ordinary rate, as you would have.

Income in respect of a decedent | Details |

Indemnity insurance
An indemnity insurance plan pays up to a fixed amount when you make a claim. The premiums on health insurance indemnity plans may be lower than on other plans, but the fixed payments may cover only a fraction of your medical bills. Most advisers suggest that indemnity plans should not be considered substitutes for more comprehensive health insurance.

Indemnity insurance | Details |

Index fund
An index mutual fund is designed to mirror the performance of one of the major stock or bond indexes, such as Standard & Poor's 500-stock Index (S&P 500) or the Russell 2000, by purchasing all of the securities included in the index, or a representative sample of them.

Index fund | Details |

Individual retirement account (IRA)
These tax-deferred retirement accounts are designed to encourage working people to invest for the long term. If you earn income from work, or are married to someone who does, you can put up to $2,000 per year in an IRA and postpone paying tax on any earnings. However, you must be at least 59 1/2, or qualify for an exception, to withdraw without owing a 10% penalty, in addition to taxes due on the amount you take out.

Individual retirement account (IRA) | Details |

Inefficient market
When a market is described as inefficient, it means that investors do not know enough about the securities in that market to make informed decisions about what to buy or the price to pay. Markets in emerging nations may be inefficient, since few analysts follow the securities being traded there. Similarly, there can be inefficient markets for stocks in new companies, particularly those in new industries.

Inefficient market | Details |

Inflation
Inflation is a persistent increase in prices, triggered when demand for goods is greater than the available supply. Moderate inflation often accompanies economic growth, but the Federal Reserve Bank and central banks in other nations try to keep inflation in check, usually by decreasing the money supply when inflation heats up, making it more difficult to borrow.

Inflation | Details |

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