If you have ever shopped for a mortgage, opened a new bank account or gotten insurance, you have made use of financial services. It is easy to confuse the term “financial services” with the actual service or good that is provided, such as a loan or an insurance policy, but the industry includes much more than just those specific products and offerings. The financial services sector encompasses everything from depository institutions, investment firms and credit-granting organizations to the critical utilities that support them all.
Among the most well-known types of financial services are banks and credit unions, which handle checking accounts and savings programs as well as offering loans like mortgages and auto loans. The banking industry also offers a wide range of payment services, including global payments networks like Visa and Mastercard and currency exchanges. Additionally, the industry covers everything from debt management companies and accounting services to life insurance companies and retirement planners.
The broadest definition of financial services entails everything that can be done with money, including buying and selling goods and commodities, investing in securities (stocks, bonds and other investments), borrowing, lending, saving and budgeting. This industry plays an important role in the economy of a country and can affect everything from employment rates to consumer spending.
There are a number of ways to get into the field of financial services, although it is often easier for those with a background in business or an MBA to move into higher-level positions. The best way to break into the industry, however, is often through networking and finding entry-level positions that will provide training and experience on the job.
Careers in financial services pay a lot more than jobs in many other industries, and they can be very rewarding for those who work hard early on and are willing to take some risks. The field is also very fast-paced, and those who do well in the beginning will often see their salaries and responsibilities skyrocket.
As a sector, financial services is heavily regulated, with government agencies at the federal and state levels overseeing most activities. A number of financial services providers are also self-regulated, using their own internal auditing and compliance departments to keep their own house in order.
The financial services industry is essential to the economy of any country, and it is vital for people to have control over their own personal finances. When people are able to manage their own financial affairs, they are more resilient when bad events occur and are better positioned to save for the future. This will ultimately lead to a more stable society. It is also a very lucrative industry, and one that will continue to grow as more and more individuals are looking to take back control of their own finances.