Money Terms in Plain English.

M

Magnificent Seven

A nickname for seven giant US technology companies that move global index funds.

In plain English:A nickname for seven huge US tech companies, like Apple and Microsoft. They're so big that they move global index funds a lot.

MoreLess about Magnificent Seven

The name comes from a 1960 western film. Their rise drove much of the US market's gains in 2023 and 2024.

Having so much in a few companies means global funds are less spread than they look.

For example: Someone with a global index fund finds a big part of it is in just these seven companies.

See also: Concentration risk

Maintenance LoanUK

A student loan towards living costs while you're at university.

In plain English:A student loan to help with living costs, like rent and food, while you study. It's paid back after you earn over a set amount.

MoreLess about Maintenance Loan

It's paid into your bank account at the start of each term. The amount differs for students living at home, away or in London.

Some students also get grants or bursaries that don't need paying back.

For example: A student living away from home outside London gets a maintenance loan paid each term towards rent and food.

Article inside Foliopeak: Student Finance in England: What a New Student Borrows, and What They Repay

Making Tax Digital for Income TaxUK

Self-employed people and landlords keeping digital records and updating HMRC each quarter.

In plain English:Self-employed people and landlords above a certain income must keep their records in software and send HMRC an update every three months.

MoreLess about Making Tax Digital for Income Tax

It comes in stages, from April 2026 once qualifying income is over £50,000, then over £30,000 from April 2027, then over £20,000 from April 2028.

Software must be compatible with HMRC. Some people can ask to be exempt, such as those who can't use computers.

For example: A self-employed hairdresser over the income limit keeps their records in an app and sends HMRC a short update every three months.

Figures checked 11 November 2026. Source: gov.uk (opens in a new tab)

Article inside Foliopeak: Making Tax Digital, and When It Reaches You

Mandatory reconsiderationUK

Asking the DWP to look again at a benefit decision, before you can appeal.

In plain English:If you disagree with a benefit decision, you must first ask the DWP to look at it again. Only then can you appeal to a tribunal.

MoreLess about Mandatory reconsideration

Write clearly why the decision is wrong and include any new evidence. Many decisions are changed at this stage or at tribunal.

Late requests may be accepted with a good reason.

For example: Someone's disability benefit claim is refused. They ask for a mandatory reconsideration with a letter from their doctor, and the decision is changed.

See also: Universal Credit

Margin

The money you put down to open a trade made with borrowed money.

In plain English:When you trade with borrowed money, the margin is the part you put down yourself. If prices move against you, you may need to put in more.

MoreLess about Margin

The amount needed depends on how risky the asset is. It's often shown as a percentage.

Interest may be charged on positions held overnight.

For example: Someone puts down £500 margin to open a £5,000 trade. A 10% fall in price wipes out the whole £500.

Article inside Foliopeak: Leverage - Borrowing to Invest

Margin call

When a broker asks for more money or closes your trade because it has gone against you.

In plain English:If your trade made with borrowed money loses value, your broker asks you to add more money. If you don't, they close the trade and you take the loss.

MoreLess about Margin call

Prices can move fast, so trades may be closed at a big loss. Keeping extra money in the account can help, but adds risk.

Professional clients may not have the same protections.

For example: A share falls sharply overnight, and the broker closes someone's CFD trade as their money falls below the level needed.

Article inside Foliopeak: Leverage - Borrowing to Invest

Marginal tax rate

The tax you pay on your next pound of income.

In plain English:The rate of tax on the next pound you earn. Because of how allowances work, it can be higher than you'd expect at some income levels.

MoreLess about Marginal tax rate

Outside Scotland, income tax takes 60% of each pound between £100,000 and £125,140, because the Personal Allowance is being withdrawn as well.

It matters for decisions like taking extra hours or a bonus, or paying into a pension. Benefits being withdrawn can push it higher than tax rates alone.

Scotland has more bands, so marginal rates there differ.

For example: On a £60,000 salary, a £1,000 pay rise is taxed at 40%, so you keep £600 of it before National Insurance.

Figures checked 11 November 2026. Source: gov.uk (opens in a new tab)

Article inside Foliopeak: The £100k TrapGame: Cliff Edge

Market capitalisation

What a whole company is worth on the stock market.

In plain English:The share price times the number of shares. It tells you what the whole company is worth on the stock market.

MoreLess about Market capitalisation

It's often shortened to market cap. Companies are grouped as large, mid or small cap.

It changes every time the share price moves, and isn't the same as what a buyer would pay for the whole company.

For example: A company has 500 million shares priced at £4. Its market capitalisation is £2 billion.

Market correction

A fall of at least a tenth from a recent high.

In plain English:When the stock market drops by at least a tenth from its recent high. It happens fairly often and doesn't always mean worse is coming.

MoreLess about Market correction

They happen often, roughly once every year or two in many markets. Most recover within months.

Selling in a correction can lock in losses.

For example: The FTSE 100 falls 11% over three weeks after worrying economic news, then recovers over the next few months.

Market maker

A firm that is always ready to buy and sell an investment, so others can trade.

In plain English:A firm that is always ready to buy or sell a particular share, so other people can trade whenever they want.

MoreLess about Market maker

On the London Stock Exchange, market makers keep trading going for many smaller shares. The gap between prices is called the spread.

Spreads are wider for shares that trade less often.

For example: A market maker quotes a share at 99p to sell to you and 100p to buy from you, keeping the 1p difference.

Article inside Foliopeak: Stocks, Shares and Equities

Market order and limit order

Buying at today's price, or only at a price you set.

In plain English:A market order buys or sells straight away at the current price. A limit order only goes through if the price reaches the level you set.

MoreLess about Market order and limit order

Market orders can go through at a worse price than expected if the market moves fast. Limit orders give control but might not fill.

Many platforms only allow market orders for funds, which are priced once a day.

For example: Someone sets a limit order to buy a share at £5. The price falls to £4.95 the next day, so the order goes through at £5 or less.

Market timing

Trying to buy before prices rise and sell before they fall.

In plain English:Trying to guess the best moment to buy and sell. It's very hard to get right, and missing the few best days can cost a lot.

MoreLess about Market timing

The best and worst days often come close together, during periods of panic. Investing regularly avoids having to pick a moment.

Time in the market tends to matter more than timing.

For example: Someone sells after a fall to wait for things to calm down. The market jumps the next week and they miss the recovery.

See also: Time horizon

Marriage AllowanceUK

Lets a lower-earning partner pass some tax-free allowance to the other.

In plain English:If one partner earns less than their tax-free amount, they can pass some of it to the other partner, who must be a basic rate taxpayer. You can save tax each year.

MoreLess about Marriage Allowance

It can be backdated for up to four tax years. You claim online with HMRC.

For example: Your partner can pass you £1,260 of their allowance, cutting your tax by up to £252 a year.

Article inside Foliopeak: Marriage Allowance

Marriage value (lease extensions)UK

Extra money paid to extend a lease once it's short, which a new law is scrapping.

In plain English:When a lease gets short, extending it used to cost extra because the home would be worth more. A new law is getting rid of this extra cost.

MoreLess about Marriage value (lease extensions)

It applies once a lease is under 80 years, and leaseholders must pay half of it to the freeholder. A 2024 law scraps it, but until that part starts it still applies.

It's worked out as part of the price of a lease extension. Extending before 80 years avoids it.

Changes to the law will remove it once in force.

For example: Someone with 75 years left on their lease pays much more to extend than a neighbour who extended at 82 years, because marriage value applies.

See also: Lease extension

Married Couple's AllowanceUK

A tax cut for married couples where one partner is in their nineties or older.

In plain English:A tax cut for married couples or civil partners where at least one was born before the sixth of April nineteen thirty-five.

MoreLess about Married Couple's Allowance

At least one of the couple must have been born before 6 April 1935.

It lowers the tax bill directly, not taxable income. The amount depends on income.

It's claimed through HMRC or a tax return.

For example: A married couple where the husband was born in 1934 claim married couple's allowance, cutting their yearly tax bill.

Article inside Foliopeak: Marriage Allowance

Master trustUK

A workplace pension used by many unrelated employers.

In plain English:A big workplace pension scheme that many different employers use for their staff, like NEST.

MoreLess about Master trust

They're common because they let small employers offer a pension without running their own scheme. Authorisation checks their money and running.

Charges are usually low.

For example: A small café enrols its staff into a master trust, which also runs pensions for thousands of other employers.

Maternity AllowanceUK

Weekly money for new mothers who can't get maternity pay from an employer.

In plain English:If you can't get maternity pay from your employer, for example because you're self-employed, you may get this weekly money from the government.

MoreLess about Maternity Allowance

It's paid for up to 39 weeks.

It's paid by the government, not an employer. You claim it from Jobcentre Plus.

The amount depends on your earnings and National Insurance.

For example: A self-employed hairdresser who is pregnant claims maternity allowance from the government for the weeks she's off work.

Maturity

The date a bond or fixed savings account ends and pays you back.

In plain English:The date a bond or fixed-rate savings account comes to an end and you get your money back.

MoreLess about Maturity

Bonds can be sold before maturity, but the price may be more or less than face value.

Some accounts automatically renew at maturity, often at a worse rate.

For example: A five-year fixed savings account reaches maturity, and the saver moves the money to a better account.

Article inside Foliopeak: Bonds

Meme stocks

Shares pushed up by crowds on social media rather than by how the business is doing.

In plain English:Shares whose prices shoot up because lots of people online pile in together, not because the company is doing well. They can crash just as fast.

MoreLess about Meme stocks

Some people trade them as a game or protest. Short sellers can lose big sums if prices jump.

Prices are often far from the company's real value.

For example: In 2021 GameStop's share price rose more than tenfold in weeks as online traders bought in, then fell back sharply.

See also: Short squeeze

Memecoin

A cryptocurrency that started as a joke or internet trend, driven mostly by hype.

In plain English:A cryptocurrency started as a joke or internet trend, like Dogecoin. Its price depends almost entirely on hype.

MoreLess about Memecoin

New ones are launched daily. Some are created to trick buyers and are dumped by their makers.

Prices can rise and fall by huge amounts in hours.

For example: Someone buys a new memecoin after seeing it on social media. Its makers sell their coins and the price drops 95% in a day.

Article inside Foliopeak: Cryptocurrency

Merger, demerger and spin-off

Companies joining into one, or one splitting part of itself off as a new company.

In plain English:A merger is when two companies join into one. A demerger or spin-off is when a company splits part of itself into a new, separate company.

MoreLess about Merger, demerger and spin-off

Mergers often come with promises of cost savings, which don't always happen. Shareholders in both companies usually vote.

After a demerger, both companies may do better on their own.

For example: A company spins off its drinks business. Shareholders end up with shares in both companies.

See also: Takeover

MiCA (EU crypto rules)

The EU's rules for crypto firms and stablecoins.

In plain English:The EU's set of rules for crypto firms and stablecoins, to protect customers. It doesn't apply in the UK.

MoreLess about MiCA (EU crypto rules)

MiCA stands for Markets in Crypto-Assets. It came fully into force in 2024.

UK investors using EU firms may see changes, but UK rules apply here.

For example: An EU crypto exchange must get a MiCA licence to keep serving customers across Europe.

See also: Stablecoin

Mileage allowance paymentsUK

Tax-free money your employer can pay for work trips in your own car.

In plain English:If you use your own car for work trips, your employer can pay you a set amount per mile tax-free. If they pay less, you can claim tax relief on the gap.

MoreLess about Mileage allowance payments

Rates are higher for the first 10,000 business miles in a tax year, then lower. Commuting doesn't count as business travel.

Keep a record of business journeys.

For example: An employer pays someone less per mile than HMRC's approved rate, so they claim tax relief on the difference.

Minimum payment

The least your credit card statement asks you to pay.

In plain English:The smallest amount you must pay on your credit card each month. Paying only this means the debt takes years to clear and costs much more.

MoreLess about Minimum payment

Card companies must show how long it would take to pay off the balance by only making minimum payments. Setting up a Direct Debit for more helps.

For example: Paying only the minimum on a £3,000 card balance can take many years to clear and cost more in interest than the balance itself.

Article inside Foliopeak: Credit Cards and Borrowing: What It Really CostsGame: Snowball vs Avalanche

Mirror wills

Matching wills, often for a couple, that leave everything to each other.

In plain English:Two wills that match, usually for a couple. Each leaves everything to the other, then to the same people, like the children.

MoreLess about Mirror wills

Because either person can change theirs later, the surviving partner could leave things differently. Mutual wills or trusts can fix wishes.

They're often cheaper to make together.

For example: A couple makes mirror wills leaving everything to each other, then to their children.

Momentum investing

Buying what's been rising and selling what's been falling, betting the trend continues.

In plain English:The idea is that a rising price tends to keep rising for a while. It can work, but trends can turn suddenly.

MoreLess about Momentum investing

It's the opposite of value investing, which looks for things that have fallen and seem cheap.

It needs a lot of buying and selling, so costs and tax add up. Some funds follow it with set rules instead.

For example: A momentum fund buys the shares that rose most over the past year. When the market turns, many of them fall fastest.

Monetary Policy Committee (MPC)UK

The Bank of England group that sets interest rates.

In plain English:A group of nine experts at the Bank of England who meet regularly to decide the main interest rate.

MoreLess about Monetary Policy Committee (MPC)

It meets eight times a year. Each member votes, and the results and minutes are published.

Four members are from outside the Bank.

For example: The committee votes 6-3 to cut Bank Rate, and mortgage rates start to fall soon after.

Money market fund

A low-risk fund that holds cash and very short-term loans.

In plain English:A low-risk fund that holds cash and very short loans to banks and governments. Its return tends to follow interest rates.

MoreLess about Money market fund

They're often used for cash in investment accounts or pensions. Returns change with interest rates.

They can still fall in value, though rarely.

For example: Someone keeps cash in a money market fund in their stocks and shares ISA while waiting to invest.

Money mule

Someone who lets their bank account be used to move stolen money.

In plain English:Someone who lets criminals use their bank account to move stolen money, often for a fee. It's a crime and can ruin your banking.

MoreLess about Money mule

Young people and students are often targeted. Signs include being asked to receive and pass on money for a fee.

Saying no protects you and others from fraud.

For example: A student is offered £300 to let money pass through their account. It's stolen money, and their account is closed.

Money Purchase Annual Allowance (MPAA)UK

A lower pension allowance that applies once you start taking taxable pension cash.

In plain English:Once you take taxable money from a pension pot flexibly, the amount you can pay into pensions each year with tax relief drops a lot.

MoreLess about Money Purchase Annual Allowance (MPAA)

It's £10,000 a year.

It's meant to stop people paying in to get tax relief and then taking the money straight back out. Taking an annuity or a small pot may not trigger it.

For example: Once you've taken taxable cash from a pension pot, only £10,000 a year can go into pension pots with tax relief.

Figures checked 11 November 2026. Source: gov.uk (opens in a new tab)

Article inside Foliopeak: The 25% Tax-Free Lump Sum, and the Allowances That Replaced the Lifetime Allowance

Money supply

All the money in an economy, from cash to money in bank accounts.

In plain English:All the money in the economy, including notes, coins and money sitting in bank accounts. If it grows fast, prices may start rising faster.

MoreLess about Money supply

It's measured in different ways, such as M0, M1 and M4. M4 includes most bank deposits.

Growth slowed sharply after the post-pandemic surge.

For example: After big money creation in 2020 and 2021, money supply jumped, and inflation rose over the next two years.

See also: Quantitative easing (QE)

Money transfer card

A credit card that lets you move money into your bank account, often with no interest for a while.

In plain English:A credit card that lets you move money into your current account, often with no interest for a while, for a fee. Useful for clearing an overdraft.

MoreLess about Money transfer card

The fee is often a few percent of the amount moved. Missing a payment can end the 0% offer early.

It only helps if you pay it off before the offer ends.

For example: Someone moves £2,000 to their bank account to clear their overdraft, paying a 4% fee but no interest for 18 months.

Article inside Foliopeak: Credit Cards and Borrowing: What It Really Costs

MoneyHelperUK

The free, government-backed money guidance service.

In plain English:A free service backed by the government that gives impartial guidance on money, debt and pensions, online and by phone.

MoreLess about MoneyHelper

It covers debt, pensions, saving and more. It doesn't sell anything.

It also runs Pension Wise appointments for over 50s.

For example: Someone nearing retirement books a free Pension Wise appointment through MoneyHelper.

Article inside Foliopeak: Debt Help: Free Advice and the Formal Options

Moral hazard

Taking bigger risks because someone else will bear the cost.

In plain English:When people take bigger risks because they know someone else will pay if things go wrong, like a bank expecting to be rescued.

MoreLess about Moral hazard

It's why insurance has excesses, so customers bear some of the cost. Bank rescues in 2008 raised these concerns.

Rules now aim to let banks fail without taxpayers paying.

For example: A bank takes huge risks, expecting the government to rescue it if things go wrong.

See also: Too big to fail

Mortgage

A loan to buy a home, secured on the home.

In plain English:A loan to buy a home. The home is security, so if you can't keep up payments, the lender can take it back.

MoreLess about Mortgage

The interest rate can be fixed or change over time. Lenders check income, spending and credit.

Missing payments can lead to repossession, but lenders must treat you fairly first.

For example: Someone borrows £200,000 over 25 years to buy a £250,000 home, with the home as security.

Article inside Foliopeak: Fixes, Trackers, and What Overpaying Really Does

Mortgage broker

Someone who finds and arranges a mortgage for you.

In plain English:Someone who searches the market and helps you find and apply for a mortgage. Some charge a fee, others are paid by the lender.

MoreLess about Mortgage broker

A whole-of-market broker can search most lenders. Some deals are only available through brokers.

They must explain how they're paid.

For example: A self-employed buyer uses a broker who finds a lender happy with their type of income.

Mortgage CharterUK

A promise by most lenders to help people struggling with mortgage payments.

In plain English:Most big lenders promised to help people struggling with their mortgage, like letting them switch to interest-only for a while, without harming their credit.

MoreLess about Mortgage Charter

It was signed in 2023. Lenders won't repossess your home within 12 months of a first missed payment unless you agree.

Switching to interest-only raises costs later. Lengthening your term means more interest overall.

Lenders must also contact you before a fixed deal ends.

For example: Someone worried about rising payments switches to interest-only for six months under the mortgage charter, without a new affordability check.

Article inside Foliopeak: Debt Help: Free Advice and the Formal Options

Mortgage Guarantee SchemeUK

A government scheme that helps lenders offer mortgages with small deposits.

In plain English:The government promises lenders it will cover some of their losses, so they're willing to offer mortgages to people with small deposits.

MoreLess about Mortgage Guarantee Scheme

It has been permanent since July 2025.

The government covers part of the lender's loss if the borrower can't pay. It doesn't change the borrower's duty to repay.

Rates on 95% mortgages can still be higher.

For example: A first-time buyer gets a mortgage with a 5% deposit, offered by a lender that uses the guarantee scheme.

Mortgage in principle

A lender's rough idea of how much it might lend you.

In plain English:A note from a lender saying roughly how much it might lend you, after a quick check. It's not a promise.

MoreLess about Mortgage in principle

It's often needed before an estate agent will take an offer seriously. It may use a soft or hard credit search.

It usually lasts 30 to 90 days.

For example: Someone gets a mortgage in principle for £220,000 before house hunting, so they know what to look at.

Article inside Foliopeak: Fixes, Trackers, and What Overpaying Really Does

Mortgage offer

A lender's formal promise to lend.

In plain English:The lender's formal written promise to lend you a set amount on a particular home, after checks and a valuation.

MoreLess about Mortgage offer

The lender can still withdraw it if your situation changes. Exchange contracts before it expires.

Your conveyancer will check its terms.

For example: Someone gets a mortgage offer valid for six months, then exchanges contracts on their new home within that time.

Mortgage prisoner

Someone stuck on a high mortgage rate who can't switch.

In plain English:Someone stuck paying a high mortgage rate because their lender stopped lending and other lenders won't take them on.

MoreLess about Mortgage prisoner

The FCA has changed rules to help some switch. Some have been able to move to new lenders.

Others still pay high rates.

For example: Someone's lender failed in 2008, and their mortgage was sold to a firm with no new deals, leaving them on a high rate.

Mortgage stress test

A lender checking you could still afford the mortgage if interest rates went up.

In plain English:Before lending, a lender checks you could still keep up payments if interest rates went up a lot.

MoreLess about Mortgage stress test

Stress tests can be lower for fixed deals of five years or more.

It can limit borrowing even if you can afford current payments.

For example: A lender checks someone could afford their mortgage at 3 percentage points above the deal rate, and offers to lend a bit less.

Article inside Foliopeak: Fixes, Trackers, and What Overpaying Really Does

Mortgage term

How long a mortgage is set to be repaid over.

In plain English:The number of years you'll take to pay off your mortgage. A longer term means lower monthly payments, but more interest overall.

MoreLess about Mortgage term

Terms of 25 years are common, but 30 or 35 years are now more common for first-time buyers.

Lenders may limit terms that end after retirement.

For example: Someone picks a 35-year term instead of 25 years, cutting their monthly payment but paying more interest in total.

Article inside Foliopeak: Fixes, Trackers, and What Overpaying Really Does

Mortgage valuationUK

The lender's check that a home is worth the loan, which isn't a survey.

In plain English:The lender checks the home is worth enough to lend on. It's for the lender, not you, and won't tell you about problems like damp.

MoreLess about Mortgage valuation

Some lenders do it remotely or online. It doesn't check for damp, subsidence or other problems.

A survey is worth paying for separately.

For example: The lender values a home at £240,000, below the £250,000 price, so the buyer has to find more deposit or renegotiate.

See also: Home survey

Mortgage-backed securities

Investments made by bundling many mortgages together.

In plain English:Lots of mortgages are bundled together and sold to investors, who get paid from homeowners' monthly payments.

MoreLess about Mortgage-backed securities

They're still widely used. Rules have tightened since 2008.

They pay interest from the mortgage payments.

For example: A bank bundles thousands of mortgages and sells the bundle to investors, who get the monthly repayments.

See also: Subprime lending

Motability SchemeUK

Swapping the mobility part of a disability benefit for a leased car, scooter or wheelchair.

In plain English:If you get the higher mobility part of certain disability benefits, you can swap it for a leased car, scooter or powered wheelchair.

MoreLess about Motability Scheme

You can choose from many cars. There's sometimes an upfront payment for bigger cars.

The lease usually lasts three years.

For example: Someone on the higher mobility rate of PIP swaps it for a new car through Motability, with insurance included.

MSCI World

An index of big companies across the developed world.

In plain English:An index of large companies across rich countries, like the US, Japan and the UK. Many global index funds follow it.

MoreLess about MSCI World

It has well over a thousand companies from more than 20 developed countries. The UK is a small part of it.

Funds tracking it are a simple way to invest globally.

For example: Someone buys an MSCI World tracker fund, getting a slice of large companies across the US, Europe and Japan.

Multi-asset fund (ready-made portfolio)

One fund holding a ready-made mix of investments.

In plain English:One fund that holds a ready-made mix of things, like shares, bonds and cash, so you're spread out without picking them yourself.

MoreLess about Multi-asset fund (ready-made portfolio)

It saves you having to pick and rebalance funds yourself. Fees can be higher than single index funds.

It's often used as a ready-made portfolio.

For example: Someone picks a medium-risk multi-asset fund with 60% shares and 40% bonds, which the provider rebalances.

Mutual fund

The US and international name for a fund that pools money, like a UK unit trust.

In plain English:A fund where lots of people's money is pooled and invested together. It's the American name for what the UK calls a unit trust or OEIC.

MoreLess about Mutual fund

In the US, mutual funds are often bought directly or through retirement accounts. UK investors usually use UK funds.

US mutual funds often aren't available to UK investors.

For example: An American colleague mentions their mutual fund; in the UK, the nearest thing is an OEIC.

See also: OEIC (open-ended investment company)