InvestingFIRE glossary
Defined termBond
A loan to a government or company that pays interest and returns principal at maturity. The ballast that smooths portfolio volatility and buffers sequence risk.
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Expense Ratio
The annual fee a fund charges, expressed as a percentage. A 0.03% ratio means $3/year on $10,000. Tiny differences compound massively over 20+ years — always minimize this.
Target Date Fund
An all-in-one fund that automatically shifts from stocks to bonds as a target retirement year approaches. Great default inside 401(k)s; less ideal in taxable due to capital gains distributions.
VTI / VTSAX / VOO
Popular Vanguard tickers for the US total stock market (VTI, VTSAX) and S&P 500 (VOO). Commonly held core positions in FIRE portfolios.
ETF
A fund that trades on an exchange like a stock. ETFs often track an index, have low expense ratios, and can be bought and sold throughout the trading day.
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