Glossary
Balance
GeneralThe amount of money in an account at a given time, or the amount still owing on a loan or credit card. A positive bank balance means you have funds available; a loan balance means you still owe money.
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Overdraft
When you spend more money than is in your bank account. Banks may cover the shortfall but charge overdraft fees or interest. Setting up overdraft protection in advance is cheaper than being hit with surprise charges.
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Principal
The original amount of money borrowed or invested, not including interest or earnings. On a loan, your payments go toward both principal and interest; paying down principal faster saves money over time.