Gnomenclature

Liability insurance is a type of auto or home insurance that covers you for a certain amount of harm done to others or their property. However, it does not cover expenses for harm done to yourself or your property.

Life expectancy is the length of time you are expected to live. It is important for retirement planning purposes because it indicates how long your financial resources will have to last.

Note that life expectancy for retirement planning is not an exact estimate and the older you get, the older your age of death is expected to be.

Liquidity refers to how easily an asset can be converted into cash without losing value. Cash is the most liquid asset. Assets with less liquidity take longer to sell and may lose value when converted into cash. Cars, real estate, fine art, and collectibles are examples of assets that are considered to have less liquidity.

Loan is an amount of money borrowed with specific terms as to how it will be paid back and what interest and fees will be charged for the loan. Student loans are available as part of federal programs as well as from private lenders.

Loan term is the length of time over which your loan must be repaid. A shorter loan term will result in higher monthly payments. However, it will also allow you to pay the loan off sooner and pay less interest over the life of the loan.

Loose monetary policy makes funds easily available to borrowers. It is primarily associated with the Fed setting low interest rate targets. This promotes spending and investment; but if carried too far, it can lead to excessive speculation and inflation.