The length of time before half the principal on a debt is expected to be repaid through amortization or sinking fund payments. For example, a 25-year bond issue may require the issuer to retire 5% of the beginning principal commencing 5 years after the issue date. Thus, the bond issue has a half-life of 5 years plus the number of years required to retire half the issue, or 15 years. Mortgage-backed securities often have a relatively short half-life because many homeowners pay off or refinance their mortgages early. Also called average life.