The Billfold ABCs: A is for AMORTIZE
by Deb Weiss and Charrow
The Billfold ABCs is a new feature that translates financial language into understandable concepts. Using real life examples alongside definitions and illustrations, Billfold ABCs explains the words that we associate with money.
A is for AMORTIZE
Definition: to spread out the cost of something over multiple periods. This can mean paying off debt in installments over time or accounting for the cost of an asset over the useful life of that asset. In accounting, this is usually an intangible asset.
Real life example: sure, one expensive haircut may cost $600, but if you think about it on a monthly cost basis, it’s just a latte a day. Right, Suze Orman?
What other financial words have you scratching your head? Leave suggestions for the Billfold ABCs in the comments!
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