What Is a Deficit? In financial terms, a deficit occurs when expenses exceed revenues, imports exceed exports, or liabilities exceed assets. A deficit is synonymous with a shortfall or loss and is the opposite of a surplus. A deficit can occur when a government, company, or person spends more than it receives in a given
What Is Deficit Net Worth? Deficit net worth is a situation in which net liabilities are higher than net assets. Also known as negative net worth, deficit net worth can occur for a variety of reasons, but typically it arises when current or future asset values erode unexpectedly. Key Takeaways Deficit net worth occurs when
What Is Deficit Spending? In the simplest terms, deficit spending is when a government’s expenditures exceed its revenues during a fiscal period, causing it to run a budget deficit. The phrase “deficit spending” often implies a Keynesian approach to economic stimulus, in which the government takes on debt while using its spending power to create
What Is a Deficit Spending Unit? A deficit spending unit is an economic term used to describe how an economy, or an economic group within that economy, has spent more than it has earned over a specified measurement period. Both companies and governments may experience a deficit spending unit. Key Takeaways A deficit spending unit
What Is a Defined-Benefit Plan? A defined-benefit plan is an employer-sponsored retirement plan where employee benefits are computed using a formula that considers several factors, such as length of employment and salary history. The company is responsible for managing the plan’s investments and risk and will usually hire an outside investment manager to do this. Typically
What Is a Deduction? A deduction is an expense that can be subtracted from a taxpayer’s gross income in order to reduce the amount of income that is subject to taxation. For example, if you earn $50,000 in a year and make a $1,000 donation to charity during that year, you are eligible to claim
What Is a Deed in Lieu of Foreclosure? A deed in lieu of foreclosure is a document that transfers the title of a property from the property owner to their lender in exchange for relief from the mortgage debt. Choosing a deed in lieu of foreclosure can be less damaging financially than going through a
What Is a Deed of Release? A deed of release is a legal document that removes a previous claim on an asset. It provides documentation of release from a binding agreement. A deed of release might be included when a lender transfers the title of real estate to the homeowner upon satisfaction of the mortgage.
What Is a Deed of Reconveyance? A deed of reconveyance is a document that transfers the title of a property from a mortgage lender to the borrower once the loan has been paid. Key Takeaways A deed of reconveyance is issued when a mortgage has been paid in full.The deed of reconveyance confirms that the
What Is a Deep-Discount Bond? A deep-discount bond is a bond that sells at a significantly lesser value than its par value. In particular, these bonds sell at a discount of 20% or more to par and has a yield that is significantly higher than the prevailing rates of fixed-income securities with a similar profiles.
