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Investments glossary

Sinking Fund


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(W)e need to ensure our national drug policy reflects the increase of drugs crossing the U.S.-Mexico border, we also need to equip our drug and law enforcement officers with the resources they need to fight back against this epidemic.

— Shelley Moore Capito

A sinking fund is a fund containing money set aside or saved to pay off a debt or bond. A company that issues debt will need to pay that debt off in the future, and the sinking fund helps to soften the hardship of a large outlay of revenue. A sinking fund is established so the company can contribute to the fund in the years leading up to the bond’s maturity.


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