G

Gilt (Gilt Edged Security) - A fixed-interest bond or security issued by the British Government.

GPP (Group Personal Pension) - An arrangement made for employees of a particular employer to participate in a personal pension scheme on a group basis.

H

Hedging - A strategy designed to offset investment risk.

I

IFA - Independent Financial Adviser - A professional financial expert who must by law give impartial "best advice" on financial companies, markets and products. IFAs are completely independent and can recommend the products of any company.

IMRO - Investment Management Regulatory Organisation, the body that regulates the management of unit trusts.

Income Drawdown - Facility by which you can draw an income from your pension fund while keeping the rest fully invested until the age of 75 at the latest.

Income Tax - Tax payable if you have income above the minimum level taxable in the UK.

Index - The means of measuring movement of statistics over a period of time used as a benchmark by unit trust managers.

Index-linked - Payments protected against the effects of inflation by increasing in line with the changes in the index of retail prices.

Inflation - The amount in percentage terms by which prices rise or fall year on year.

Inheritance Tax - Tax payable after you die on the value of your assets in excess of a certain threshold value (£242,000 at August 2001) although gifts between husband and wife are exempt. It is also chargeable in certain circumstances while you are still alive.

Initial Charge - A charge levied by your investment manager to cover administration and sales commission when you invest in a fund.

Interest-only Mortgage - A mortgage product where you make a monthly interest payment and rely on the a savings plan or other monies to pay off the capital at the end of the mortgage term.

Investment Trust - A company, quoted on the Stock Exchange which invests in other companies' shares.

ISA - Individual Savings Account - Tax-efficient savings plans which can hold cash, shares or life assurance, or a combination of all three elements, which were introduced in 1999 to replace TESSAs and PEPs.

J

Joint life - Joint life plans cover two (or more) people, usually a husband and wife. Benefits can be paid following the first death, or following the death of both.

K

Keyman insurance - This provides cover, in the short term, against the loss of profits a company is likely to suffer following the death of a key employee.

L

Liability - A debt, or amount of money, owed to others.

Listed company - A company whose shares are quoted on a recognised stock market.