Dictionary of Financial Terms -
- Salary Definition
- Used in group insurance to agree the definition of employee salary
to be applied in calculation of insured benefit.
- Sealing fee
- A charge made by some lenders when they release their legal charge
over the deeds.
- another name for stocks and shares but also applies to any approved
or registered financial instrument, such as bonds.
- Securities & Futures Association (SFA)
- A regulatory body which polices investment businesses like
- Securities and Investments Board
- The overall regulator of financial services set up under the
Financial Services Act 1986.
- Seed Money
- A grant or contribution used to start a new project or
- The option to take a proportion of the investment and leave the
rest invested, i.e. to take 10% of your pension and leave the other 90% still invested.
- Self Administered Scheme
- Occupational pensions scheme where the assets are invested and
managed by the trustees or an in-house investment manager.
- Self Insured Scheme
- A program financed entirely by the employer for insuring employees
instead of purchasing coverage from an insurance company.
- Self Regulating Organisation
- A body authorised by the Securities and Investment Board to
regulate and supervise investment business or financial service activities.
- Self-select PEP
- A general PEP where you can choose which funds you'd like to invest
- If you're employed, part of your National Insurance contributions
go towards the State Earnings Related Pension Scheme, which is paid on top of your basic state pension when you retire.
You can choose to contract out of SERPS, in which case the Government will pay the money that would have gone into
SERPS into a personal pension of your choice.
See: State Earnings Related Pension Scheme.
- Shares are issued by a company to raise money. Unlike bonds, which
are a straightforward loan, shares give you ownership of part of the company. Most shares are listed on a stock
exchange, which makes them easy to buy and sell, although dealing costs may be expensive, which is another attraction
of investing in a unit trust as the costs are shared with lots of others.
- Securities and Investments Board.
- Sickness and accident
- Pays you a benefit if you're unable to work through sickness or
accident. Normally pays out for a set period, i.e. one or two years.
- Simplified Administration
- The system most often used to administer group insurance. Designed
to keep administration overheads to a minimum. Normal changes in membership and benefit need only be advised to the
insurer on a periodic (usually annual) basis.
- Single company PEP
- A tax efficient investment where you invest in the shares of only
- Single Premium Costed
- A method of cost calculation used for group insurance schemes with
a small number of members (typically less than 20). The overall premium is based on the costs calculated in detail for
each member and based on age, sex and other factors.
- Single Premium Policy
- A Life Insurance policy paid for in advance by one single premium
rather than in periodic premiums.
- Small Caps
- another name for smaller companies, as measured by their market
capitalisation. Our definition of a smaller company is one which has a market capitalisation of less than US$500
million, which is still quite sizeable by most standards. Usually a switch discount of up to 3% off the offer price is
- Society of Financial Advisers. A professional body linked to the
Chartered Insurance Institute. Membership is open to those who have passed the Institute's examinations for the
Advanced Financial Planning Certificate.
- Special presentations
- A service to inform a customer paying in a cheque that the payer's
bank will make the payment. This does not reduce the time taken for the cheque to clear - this will still take three
- Self Regulating Organisation.
- Small Self-Administered Scheme. A self-administered occupational
pension scheme with usually less than 12 members.
- Stakeholder Pension
- The name given to the new personal pension, which will be
introduced by the government in two years' time. The details are not yet finalised, but it promises to be one of the
biggest shake-ups of the pensions industry for years.
- Stamp Duty
- A tax levied on certain legal transactions, these include share
dealing and the purchase of property.
- Standard Variable Rate
- A lenders standard mortgage rate. This goes up and down with
interest rates generally.
- Standing Order
- Pre authorised payment in which the customer gives instructions to
their bank to pay fixed sums at regular intervals or on defined dates.
- State Earnings Related Pension Scheme
- The earnings related part of the state pension scheme, which
provides benefits which are additional to the basic state pension.
- State pension
- The basic state pension is paid to everyone. The level of pension
you get depends on the amount of National Insurance contributions you pay over your working life.
- Stock Exchange
- A forum for the trading of stocks, shares and other securities. The
London Stock Exchange is the main stock exchange in the United Kingdom.
- Stop-Loss Insurance
- Protection purchased against the risk of large losses or a severe
adverse claim experience.
- Substandard Risk
- Where the risk of a claim against a policy is higher than
- Successor Election
- The designation, in writing by a donor, of a person to be assigned
the rights and duties associated with the donor's account at the Charitable Gift Fund upon the donor's death.
Successors are eligible only after the deaths of all donors named on the account. The donor designates an individual as
the successor, or the donor may choose to recommend that one or more charitable organizations receive the proceeds of
any remaining units in the account upon the donor's death.
- Where you cancel an investment or policy and usually receive a
reduced payout, due to the impact of charges.
- Surrender Value
- The amount of money paid to the policyholder by the insurer when
certain types of life policy are discontinued before the full benefit becomes payable.
- refers to moving an investment (or part of it) out of one fund and
into another. When you switch you sell at the bid price and sell units in the new fund at the offer price.
- Switch card
- A card linked to the UK Switch network. If you pay for goods and
services with a Switch card, the money leaves your account straightaway. You can use your One account Switch card in
just about every cash machine in Britain and tens of thousands of Cirrus machines worldwide, and to pay for goods
abroad wherever you see the Maestro sign.
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