Explore commonly used personal finance terms.
Appreciation is the rise in an asset’s value over time due to increased demand, economic growth, or other factors. Assets such as real estate, stocks, or collectibles may appreciate as market conditions improve. Appreciation contributes to a higher resale value for investors or owners, allowing them to sell the asset at a profit. Conversely, depreciation is when an asset’s value decreases, which is common for items like vehicles or equipment. Understanding appreciation is crucial for long-term investment planning and wealth accumulation.
