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Money, pension and savings glossary

The glossary explains in plain language the terms that keep coming up in pension statements, funds and the household budget. Each term has a short definition, some context and a link to the detailed guide.

  • 28 terms
  • General information, not advice

Alphabetical index

Click a term to jump to it, or search by word.

Showing all 28 terms

All terms

5

50/30/20 rule

The 50/30/20 rule splits net income into three boxes: 50% for needs, 30% for wants and 20% for saving and for paying down debt beyond the minimum.

It is a starting point, not a law. In Israel, rent, municipal tax and childcare push many households above fifty percent on needs, and then you adjust the ratio, for example to 60/20/20, and keep the principle: saving comes first. Pension contributions deducted from the payslip are saving in every sense, so avoid counting them twice.

See also:Budget

A

Accumulated balance

The accumulated balance is the amount built up in a fund to date, usually split into components: employee contributions, employer contributions and severance.

On a fund's statement it appears as the balance, and the fees on balance are charged on it. The retirement annuity forecast is derived from it and from assumptions such as return, salary and age, so it is worth checking what stands behind the assumptions. Savings forgotten at a previous employer still accrue fees, so gather every product in one place.

See also:Management fees on balancePension fund

Assets and liabilities

Assets are what you have: balances, savings, pension, investments and property such as a home. Liabilities are what you owe: a mortgage, loans and card balances.

The difference between them is net worth. To avoid mistakes, record the current balance of each debt rather than the original amount, and value illiquid assets such as a home conservatively, because their value is an estimate and not a transaction price. In a joint account it is easy to count twice, which is why Shavve neutralises duplicates when partners are connected to the same household.

See also:Net worthHousehold view

B

Budget

A budget is a plan for dividing income between spending categories and saving over a period, usually a month.

It is checked against what you actually spent: how much was planned, how much used and how much is left in each category. Most budgets fail because of complexity, not lack of will, so simple wins. What holds a budget together is automation, such as a standing order to savings on payday, not willpower.

See also:50/30/20 ruleCash flow

C

Cash flow

Cash flow is the money coming in and the money going out over a period, together with the dates on which each movement happens.

Positive cash flow means more comes in than goes out. A cash-flow forecast adds time: it shows when salary and fixed charges arrive and where the balance will hit its low point. In Shavve the forecast rests on recurring movements detected in the account, and variable day-to-day spending is not projected.

See also:Budget

Compound interest

Compound interest is when earnings themselves earn returns, so growth accelerates over time.

In long-term saving time works for you, and also against you: fees charged every year reduce the amount that will compound in the future. That is why a small gap in fees can become a large gap in the final amount. A calculation like this is an illustration, not a return forecast or a promise.

See also:Management fees

E

Emergency fund

An emergency fund is accessible money held for when it is needed, measured in months of essential expenses, so that you do not have to borrow expensively or withdraw early from long-term savings.

As a rule of thumb, three to six months is common, and more if your income is not stable. The money is kept in accessible instruments: not shares, not locked funds, and not a study fund or provident fund, where early withdrawal may cost tax and conditions. Start small; a regular deposit habit matters more than the first amount.

See also:Liquidity

F

Family office

A family office is a management model that brings together in one place all the assets and financial aspects of a family or an individual.

Originally it was a service for the very wealthy, with a team of wealth managers, advisers and accountants. Today digital tools let anyone take the basic step: map assets and liabilities, check costs and duplicates, and set a review routine. It is order and control, not necessarily investment advice, which is a separate licensed service.

See also:Net worthAssets and liabilities

Financial information service

A financial information service is a licensed provider that shows, explains and compares your financial data with your consent, and works read-only: it does not move money.

The activity is set by the Financial Information Service Law and supervised by the Israeli Securities Authority. Shavve holds a financial-information-service licence, supervised by the Israeli Securities Authority. To check that a provider is really licensed, ask the supervising authority rather than relying on the provider's own claim.

See also:Open bankingRead-only access

H

Har HaBituach

Har HaBituach ("Insurance Mountain") is a website of the Capital Market, Insurance and Savings Authority through which you can get an overall picture of the insurance and pension products registered in your name.

It is useful for getting an overall picture of what you hold in funds and policies, not only in your current fund. Shavve shows your insurance in one picture, including information from Har HaBituach, read-only. You can always check the official, current information on the website itself.

See also:Pension fundInsurance cover in a pension fund

Household view

The household view brings the money picture of two partners into one picture, and each person approves what to share.

In joint accounts it is easy to count twice; Shavve neutralises duplicates when partners are connected to the same household, so the total is right. When an AI assistant is connected through MCP, the household summary it receives is an aggregate only, not a breakdown per person.

See also:Assets and liabilitiesMCP (Model Context Protocol)

I

Insurance cover in a pension fund

A pension fund usually includes insurance cover for death (survivors' pension) and loss of earning capacity, and its cost comes out of the deposit.

If you also hold private insurance, check for overlap. The scope of cover, family status and beneficiary details are set when you join and usually do not update themselves, so verify them every few years. Before moving between providers, check what will happen to the cover you have built up.

See also:BeneficiariesPension fund

Investment provident fund (Kupat Gemel)

An investment provident fund is a flexible savings tool that lets you invest in the capital market through a track you choose, and withdraw the money at any time.

A lump-sum withdrawal involves tax on the gain, while withdrawing as an annuity at retirement age may carry a tax benefit, subject to the law's conditions. There is an annual deposit ceiling that is updated, which you check with the Capital Market Authority. Unlike a pension fund, which is meant to provide an annuity and usually includes insurance, it is a more flexible savings tool.

See also:Study fund (Keren Hishtalmut)Pension fundInvestment track

Investment track

An investment track is the way the money in a fund is invested, for example general, equities, bonds or index, and each track has a different level of risk and return.

Someone who did not choose a track usually lands in a default track by age. A common rule of thumb is more exposure to equities when young and a gradual move to a steadier track near retirement, but that is a general rule and not a personal recommendation. It is worth checking the fit every few years, especially after a change in life.

See also:Pension fund

L

Liquidity

Liquidity is how quickly and easily an asset can be turned into available money without giving up a meaningful part of its value.

A current-account balance is instantly liquid; a locked fund or a home is not. That is why an emergency fund is kept in accessible instruments rather than a study fund or shares, and why liquid net worth is measured separately from total net worth. Before locking money into a tool with a vesting period, make sure there is a liquid cushion on the side.

See also:Emergency fundNet worth

M

Management fees

Management fees are what the managing provider charges to run your savings. They come out of your money quietly and never arrive as an invoice.

They are charged in two ways, on deposits and on the accumulated balance, and both have legal caps that change from time to time, so check the current caps on the Capital Market Authority website. Because of compounding, a small percentage a year adds up to a large amount over years of saving. You can check, compare and ask your provider for a discount. Low fees are an advantage, but not the only criterion.

See also:Management fees on depositsManagement fees on balanceMarket median

Management fees on balance

Fees on balance are an annual percentage of the amount already accumulated in the savings.

They are charged even when you no longer deposit, and grow in shekel terms along with the balance, which makes them the heaviest weight over the long years. They too have a legal cap that is updated from time to time, which you check with the Capital Market Authority.

See also:Management feesManagement fees on depositsAccumulated balance

Management fees on deposits

Fees on deposits are a percentage charged on every new deposit that enters the savings.

They are charged only when you deposit: no deposit, no charge. So they mostly affect someone who is still accumulating and depositing regularly. On a fund's statement they appear next to the fees on balance, and it is worth noting both for every product.

See also:Management feesManagement fees on balance

Market median

The market median is the middle value among comparable products: half of them charge less and half charge more.

Shavve compares the management fee you pay with the published market median and with your own cheapest product. The median is a reference point, not a target: compare similar investment tracks, and remember that cost is not the only thing that matters, the track, the insurance cover and the service do too.

See also:Management fees

MCP (Model Context Protocol)

MCP (Model Context Protocol) is a protocol that lets an AI client, such as Claude or ChatGPT, read data from a connected source through a defined connection, instead of you pasting documents in by hand.

In Shavve the connection uses a personal key with scopes you choose, and it is read-only: no write tool exists, every call is recorded in an audit log, and you can revoke the key with one tap. The assistant sees only the tools for the scopes you approved.

See also:ScopeRead-only access

N

Net worth

Net worth is total assets minus total liabilities: the one number that sums up what you are worth at a point in time.

It can be negative, especially early on or after buying a home with high financing, and that is not a sign of failure. The direction over time matters more than the number itself, so check it at a steady rhythm, monthly or quarterly. It helps to show total net worth and liquid net worth separately, because pension and property are not available to spend right away.

See also:Assets and liabilitiesLiquidity

O

Open banking

Open banking is a framework that lets you instruct your bank to share specific financial data with an authorised provider, with your consent and without handing over your bank password.

You authenticate with the bank itself, and the consent screen shows what will be shared, with whom and for how long. You can revoke consent at any time, both with the service provider and with the bank. In Israel the framework is set by the Financial Information Service Law and supervised by the Israeli Securities Authority.

See also:Financial information serviceRead-only access

P

Pension fund

A pension fund is a long-term savings plan meant to secure a regular monthly income after retirement, and it usually also includes insurance in case of disability or death.

Each month a percentage of salary is set aside by the employee and the employer, and the fund invests it in an investment track. The law obliges employees to save for a pension, and the self-employed have their own rules. Contribution rates and rules change, so the exact figure is on your payslip and in the fund's statement.

See also:Investment trackInsurance cover in a pension fundManagement fees

R

Read-only access

Read-only access means a service can display your data but cannot transfer, withdraw or pay money, change standing orders, or open and close accounts.

In Shavve this holds for connections to banks and institutions and for an AI assistant connected through MCP: no write tool exists, so nothing can be changed through it. "Read-only" describes what the access can do; who may read what is set by the permission you grant, and you can revoke it.

See also:MCP (Model Context Protocol)Scope

S

Scope

A scope is a defined permission that determines which kind of data a key or an assistant may read.

In Shavve you can choose scopes for transactions, net worth and forecast, and an assistant sees only the tools that the scopes you approved allow. Give only what the question needs; the app also shows a list of what was not requested.

See also:MCP (Model Context Protocol)Read-only access

Study fund (Keren Hishtalmut)

A study fund is a medium-term savings plan, usually six years, that offers a tax benefit if you wait out the vesting period.

Employees usually get it through work, and the self-employed can deposit themselves. An early withdrawal may involve tax, and the tax-benefited deposit ceilings change, so check current figures at gov.il and with the Tax Authority. It is not an emergency fund, because its liquidity is limited.

See also:Vesting periodInvestment provident fund (Kupat Gemel)Emergency fund

V

Vesting period

The vesting period is how long money has to stay in a study fund for you to get the tax benefit on the gains when you withdraw.

It is usually six years from the first deposit. There are cases where the period is shorter, such as saving for retirement purposes, so check the rules that apply to you with the provider. Withdrawing before the end of the period may trigger tax on the gains.

See also:Study fund (Keren Hishtalmut)

Information, not advice

The definitions here are general and deliberately carry no ceilings, tax rates or amounts, because those are updated. Check current figures on the Capital Market, Insurance and Savings Authority website, with the Tax Authority and at gov.il. The glossary is not pension, investment or tax advice; for a personal decision, speak to a licensed professional.

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