We all weave dreams and also work hard to fulfill them. But, the needs in life are many and the income is limited. That’s why people often miss out on fulfilling their dreams. If we do financial planning according to our income in time, then dreams can be turned into reality. Finance is a variant of the French word called finance. Simply put, finance is a means of conducting various types of business activities. Any person, institution, company as well as the government needs finance to function.If you want to go into any field, then first of all it is very important for you to know about it, only then you will be able to take good profit in it. In today’s time, all the companies started in India are growing a lot.
What is Finance
Finance Department, Finance Job, Finance Minister, Finance Advisor What is the meaning of finance? Finance means the transaction of money. The word finance is derived from the French language and originated in the 18th century. Finance simply means the management of money. Finance Finance includes banking, credit, investment, assets and liabilities. Finance is closely related to money, as it is a medium of exchange. The financial sector operates economic, social and administrative industries. From savings to financial institutions and governments to taxes to share capital, the function of finance can be seen in all activities and processes.
Types Of Finance
Finance is divided into 3 parts,
- Personal Finance
- Corporate finance
- Public finance
1. Personal finance:-
(Personal Money Management) is called. Personal finance is a subject related to individuals and money, which teaches how to manage and control money, as well as how to get the most out of the money available. The way of managing money by every person is called personal finance in the language of finance.
2. Corporate finance:-
Corporation finance is called in Hindi language. Corporate finance includes the financial decisions an organization makes in its daily business operations. Business decisions that include decisions related to the identification of sources of capital to finance corporations are corporate financial decisions.3.
It deals with the management of finances of public bodies, such as the Central Government, State Government and Local Self-Government. Mainly in this the account of government’s income, expenditure as well as public sector financial transactions, investment is kept by the government.
The needs in life are many and the income is limited. That’s why people often miss out on fulfilling their dreams. However, dreams can be fulfilled. If we do financial planning according to our income in time, then dreams can be turned into reality.
1. Make budget according to income
One of the most important tips in financial planning is to make your budget as soon as your income starts. You should have a written record of what is coming and going. Assess what is being saved after the expenditure. After this make an investment plan.
2. Health Care
In today’s era, getting treatment for a minor illness in a good hospital can also spoil your financial condition. Because, the cost of treatment has become much more expensive than before. If even one member of the family falls ill, then sometimes it becomes necessary to spend the entire investment. Therefore, take adequate health care insurance based on the city you live in today.
Insurance provides financial compensation to your family members in case of an accident or loss of income in an unforeseen situation. Evaluate your insurance needs and take insurance accordingly.
4. Emergency Fund
Have you created an emergency fund to meet any unforeseen expenses in the future? Invest without emergency fund and withdraw the invested amount when an emergency arises. This should not be done. Adequate funds should be kept separately for any unforeseen expenses in future.
The youth are in a dilemma to improve and change their lifestyle and borrow much more than their repayment capacity. This should be avoided. If you have taken a loan, then first of all you should focus on repaying it.
6. Tax Planning
Do you do income tax planning at the beginning of every financial year? If you are not doing it then start doing it and also put some amount in this head. With this, you will not make any mistake at the last moment and you will not have any financial burden.
7. Do financial planning yourself
You should know how the money market works. If, you learn, you will be able to make your own decisions immediately. Making a financial plan and implementing it are two things. The most important thing is to implement the plan. If you understand the money market, then you will be more ready to implement your financial plan.
Financial management includes all those activities that affect decisions regarding the quantity and timing of future fund flows. There are some aspects in production and marketing decisions which do not come in the field of financial management. Finance in itself is a very broad and multi-meaning word, whatever is discussed about it will be less.
Ques:- What is the importance of financial management?
The function of financial management is to acquire, allocate and optimize resources for the short term and long term financial needs of the enterprise.
Ques:- What is the need of financial institutions?
Financial institutions work in the areas of banking, insurance, mutual funds, stock market, home loans, other loans, credit cards. The main function of financial institutions is to control the flow of money in the country.
Ques:- What is the work in a finance company?
To run any company smoothly, it is necessary to set up a startup, if you are hiring an employee for the company, then he also has to be paid, all this work can be done only with the investment of money.If a person has to do any work, do manufacturing or start a business, then for this a person needs money, then investing and using money properly is called finance.