Balance
The amount of money you have in your bank account.

Bank Account
Instead of a piggy bank, you can keep your money in your own personal account at a bank, where you can make deposits and withdrawals.

Bank Machine
Also called an ABM (Automated Banking Machine), this service lets you make simple transactions on your bank account by yourself. If you want to deposit, withdraw or transfer money, you can use a CIBC bank machine. You do not have to stand in line at the branch to see a Customer Service Representative and you can do your banking whenever you want, even when the bank is closed. But don't put your pennies in there - you can't deposit coins into a bank machine.

Bond
When you loan money to the government or a company for a specific length of time, you get a piece of paper called a "bond". Until you're paid back, you are paid interest.

Budget
An estimate of the money you will get, spend, and save, over a specific period of time.

Capital
The amount of money you invest.

Cheque
A written order to your bank, asking them to pay the amount written on the paper from your bank account to the person the cheque was given to. For example, if you have a chequing account, you could write a cheque to your mom for $10. Your mom would then "cash" the cheque, and the $10 would be withdrawn from your bank account and given to your mom.

CIBC Convenience Card®
When you open a bank account at CIBC, you may receive a CIBC Convenience Card that allows you to access your bank account from any CIBC bank machine in Canada. You can use your card in a non-CIBC bank machine, as long as you see the Interac* logo. Additional fee(s) will apply if you withdraw cash from a non-CIBC bank machine. You will also be able to pay for your purchases through Interac Direct Payment which takes the money directly from your bank account -- saving you a trip to the bank to withdraw the money.

Compound Interest
Interest that is paid on the original principal and on the past interest that you have already earned. It grows faster than simple interest (which is only paid on your original principal).

For example, if you deposit $100 in an account that pays 1%, the interest after 1 year will be $1 ($100 x 1%). With simple interest, your money grows by $1 every year. With compound interest, it will grow $1 the first year and $1.01 the second year ($101 x 1%) and so on.

Deposit
An amount of money placed into, or kept in, your bank account or GIC.

Diversification
Diversification means investing in many different types of investments like stocks, bonds and GICs. In other words, it means not putting all your eggs in one basket.

Dividend
When a company makes a profit, they may take part of that profit and pay it to their shareholders (people who own shares in the company).

Guaranteed Investment Certificate (GIC)
A GIC is like a bond, except that a bank or trust company issues it. When you buy a GIC, you're promising to keep your investment for a specific amount of time. In return, you are guaranteed your original money (called "capital" or "principal"), plus a specific amount of interest. Some GICs also allow you to cash in your investment prior to the maturity date; however, the interest paid on this type of GIC may be lower.

Interac Direct Payment
Many stores offer Interac Direct Payment as a way to pay for your purchase in their store. Basically it means you can use your CIBC Convenience Card to transfer money directly from your account to the store's Interac account.

Interest
The money you pay to borrow someone's money, or that someone pays you to borrow your money.

Here's an example of how it works: Say your parents want you to start saving money. Each week, they will give you 10 cents for each dollar that you save from your allowance. Each time you save a dollar, you then give the dollar to your parents for safekeeping. What happens when you ask your parents to give you back your savings? Your parents have to pay you back all the money you have saved, plus an extra 10 cents for each dollar you gave them for safekeeping. The extra 10 cents is called interest.

Interest Rate
It is a percentage that is applied to the principal to get the interest amount.

Investing
When you put money into investments like GICs, stocks, bonds, or mutual funds with the hope that your money will grow in value.

Mutual Fund
A group (or "pool") of investments like stocks and bonds that is professionally managed on behalf of many investors. Buying a mutual fund is kind of like instant diversification - each dollar invested goes into many different investments.

Portfolio
A range of investments held by a person or a company.

Principal
The original amount of money invested or loaned.

Return
The amount of money you earn on an investment expressed as a percentage of the total amount invested.

Risk
The chance that an investment will go down in value after you've bought it or that it won't achieve its expected return. Typically, the riskier an investment is, the greater the potential there is for a capital loss (or gain). One way to lessen risk is through diversification. Or, you could purchase a GIC.

Savings
Your savings are the total amount of money you have in the bank at any given time. This means any money you deposit into your account, plus any interest the bank has paid you.

Securities
An overall term used to describe stocks, bonds, mutual funds and money market investments.

Share
A share is one unit, or piece, of a company. If you say you "own stocks" you're usually saying you own some shares in one or more companies. The piece of paper showing your ownership in the company is called a stock certificate.

Transactions
Every time you put money into your bank account, you are making a "deposit". Whenever you take money out, you are making a "withdrawal". The bank calls these actions "transactions", which basically means that you and the bank are exchanging money.

Withdrawal
An amount of money taken from, or taken out, of your bank account.

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* Registered Trademark of Interac Inc.; CIBC authorized user of the trademark.