Financial services are economic services that help individuals, businesses, and governments manage their money. They include all activities that involve the inflow and outflow of funds, like buying and selling goods or assets, borrowing and lending, issuing stocks, making debt repayments, and levying taxes.
The financial services industry encompasses a huge range of businesses, from banks and credit unions to stock brokers, mortgage lenders, insurance companies, and investment advisors. It also includes credit-card companies, money-market and mutual fund firms, and global exchanges that facilitate stock, derivatives, and commodity trades.
A career in financial services can be incredibly rewarding, but it’s not without its challenges. This field requires a lot of networking, and it’s essential to have strong interpersonal skills to succeed. In addition, working in financial services can be a high-pressure environment due to the nature of the work.
Insurance is one of the most important sectors in financial services. It helps protect consumers against unforeseen events by providing them with a safety net that covers expenses such as medical bills or lost wages.
It also encourages savings and provides a way for families to build their wealth and improve their living standards. Many poor households save their income by depositing it in a bank or other financial institution rather than keeping it under their floorboards or under the mattress where it is easily stolen. This enables them to purchase land, livestock and consumer durables, and to expand their small businesses.