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What is Finance?

Finance is the lifeblood of the economy, encompassing the creation, management, and investment of money. It's a dynamic field that balances risk and opportunity, guiding decisions from personal savings to global markets. Understanding finance empowers you to navigate economic waters with confidence. Ready to unlock the secrets of financial fluency? Join us as we unravel the complexities of this essential realm.
Laura M. Sands
Laura M. Sands

Finance describes the act of providing money, capital or other financial resources to assist in facilitating a loan or a sale. This term is commonly used within the financial industry, which includes areas such as banking and accounting. Individual careers that help comprise the financial industry include a financial adviser or analyst, a bond broker, a portfolio manager, an investment banker and a stockbroker.

Individuals planning a financial career often major in subjects such as economics, accounting and business law. Within such majors, university students learn about the various facets of personal, government and corporate finance. An example of courses supporting such an education include business management classes, statistics classes, various economics courses, and courses which instruct students on the inner workings of different private and government monetary institutions, as well as their policies.

Finance refers to the securing of capital or other financial resources to facilitate a loan or sale.
Finance refers to the securing of capital or other financial resources to facilitate a loan or sale.

Businesses hoping to raise financial capital often seek the assistance of individuals trained to work in finance in order to secure the resources needed to start or grow a business. Attorneys specializing in certain financial genres, as well as other real estate professionals, accountants and business analysts, may also be called upon to assure that capital strategy is both strong and effective. Within the world of finance, professionals routinely work together to create and manage strong investment opportunities.

In terms of its global application, there are three primary areas of finance. These areas are investments, financial management, and financial markets and institutions. While these three areas frequently overlap with one another, employment opportunities within each are more distinct.

Individuals working in investment sectors tend to work more in direct sales transactions, financial planning or analysis of various securities. Individuals working in financial management may also focus on planning and security analysis, but tend to also work more specifically with an individual company or group and often tend to focus more on overseeing the group’s working capital. Those working in money markets and other institutions generally focus on providing liquidity and capital to large banking and financial institutions.

Specific laws pertaining to finance vary among countries and may even vary within smaller jurisdictions. Most governments, however, strictly monitor financial transactions to protect individuals, businesses and institutions from incidents of fraud or other potential hazards. Individuals trained in finance are also trained according to these laws and, in many instances, must obtain special license to work in financial sectors after undergoing a thorough examination process.

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Discussion Comments


I worked in the investment department of a major bank. My boss was a stockbroker and certified financial planner.

She really loved sitting down with people and helping them with their finances and working on a plan for their investments.

I saw many people who had a lot of money but had no financial plan when it came to managing their money. There were several other brokers in the department, but she was the only one with the financial planner certification.

It really helped her build a strong relationship with people and she felt that she was offering them a great service. Not only could she help them invest their money wisely, but also give them tools to help them with a good financial plan.


I have a small business and one of the most helpful things I did was take some business finance classes before starting my business.

I never had any formal training in this area and knew if I was going to be successful I needed to understand how this worked.

I was quite nervous at first because math and numbers never came very easy for me. I found the finance classes to be very interesting and the information I learned has been invaluable to me.

I try to take at least one kind of finance class a year now. This helps me stay current and is a good reminder that if I don't understand how my business finances work, I will probably be in a lot of trouble.

I think if someone is thinking about going into business for themselves, one of the first things they should do is take some finance classes.


My husband and I recently met with a financial planner to work out a long term plan for our finances.

Personally I think it is never too early to do something like this. It gives you a plan for your money and helps you know specifically where it is going.

This is something I wish we had done many years ago. It is easy to put off saving for the future and spend money without really thinking about it.

After meeting with the financial planner I stop and think about how I am spending my money and if this would be a help or hindrance in helping me reach my financial goals.

If you have a good handle on your finances and a plan to help you, it can take a lot of stress out of wondering if you will have enough money in the future.


Finance covers such a wide range of possibilities. I don't know much about corporate finance or what it would be like to raise capital, but I do make sure I keep a good eye on my personal finance.

I recently attended a finance seminar that focused on taking control of your personal finances. I learned many interesting things, but it made sense to me that if you can't learn to manage a small amount of money, you will never know how to manage larger sums of money.

I have never had any kind of finance job, and am not in any kind of position to tell someone else how to manage their finances. I do think it is important that I take charge of my own personal finances though.

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    • Finance refers to the securing of capital or other financial resources to facilitate a loan or sale.
      By: maotun
      Finance refers to the securing of capital or other financial resources to facilitate a loan or sale.