What is an 'account balance'? Definition & meaning

The amount of money a user has stored in a financial repository.

Account balance with a bank account

When you check your account balance at your bank, it will show the amount of cash you have stored with the bank.

If you have pending transactions, your account balance might be greater than the amount that is actually available to you. That is because the money needed to make those transactions has not yet been removed from your account.

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Account balance with a stockbroker

An account balance with a brokerage is likely to look different from a bank account balance. That’s because you don’t just keep cash with a broker.

Instead, the account balance that you see when you check your brokerage account will be the sum of any cash you hold and any stocks you have bought.

Because the value of stocks changes all the time, your account balance will also vary more frequently with stockbroker than a bank.

More terms

Quantitative easing

Find out what quantitative easing is and how central banks use this monetary measure to encourage economic growth.

Unicorn

A startup valued at over £1 billion. They are rare, hence the name.

Money laundering

A method of moving money obtained illicitly through the financial system so it can be used legally.

Equity

The amount of money a company would be left with by subtracting its liabilities from the value of its assets.

Professional Client

An investor that is able to meet several regulatory criteria.

Maturity date

The date on which a gilt is redeemed and the gilt holder receives the repayment of the nominal amount and final dividend or coupon payment.

DMO

The United Kingdom Debt Management Office. It’s an executive agency responsible for managing the government’s debt and cash needs, primarily through issuing gilts and Treasury bills.

Net Income (NI)

The money a firm is left with from sales after subtracting taxes and different business costs.

Conventional gilts

Gilts where the dividends and principal repayments are fixed in nominal terms. This is as opposed to an index-linked gilt where the dividends and principal repayments are related to movements in the Retail Prices Index (RPI).

Freetrade does not provide investment advice and individual investors should make their own decisions or seek professional advice. The value of investments can go down as well as up and you may receive back less than your original investment. Freetrade is a trading name of Freetrade Limited, which is a member firm of the London Stock Exchange and is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales (no. 09797821).

What is an account balance?