Definition

The ability of a company or individual to meet their long-term financial obligations and debts.

Example

The company's solvency was questioned after it reported significant losses.

Conversation

Have you heard about the company's solvency?

Yeah, it's been a hot topic lately.

I hope they can maintain their solvency during this tough time.

Me too! It's crucial for their future.

Synonyms & Antonyms

Root Explanation

Solvency is formed from "solvere" (meaning to loosen or to solve) and the suffix "-cy" (indicating a state or condition). The word refers to the state of being able to meet one's financial obligations or debts, essentially meaning the ability to 'loosen' oneself from financial burdens.

Memory Tip

Think of 'solvere' meaning to 'loosen' or 'solve' — this helps you remember that solvency is about being in a state where you can meet your financial obligations.

Visually Confused Words