What is Finance?

Finance is the management of money and assets, how individuals, businesses, and governments earn, spend, save, invest, and borrow money to achieve their goals.

It deals with questions like:

1. How should I budget my income?
2. Where should I invest my savings?
3. How can a business raise funds to grow?
4. How do banks, markets, and governments manage money flows?

🔑 Key Points about Finance

1. Definition:
   Finance is the science and art of managing money, investments, and financial resources.

Main Functions:

1. Managing funds (income, expenses, and savings)
2. Investing in opportunities to grow wealth
3. Raising capital (loans, shares, bonds)
4. Risk management (insurance, diversification)

Types of Finance:

1. Personal Finance → Managing individual or household money (budgeting, saving, investing).
2. Corporate Finance → How businesses manage their finances (funding, profits, growth).
3. Public Finance → How governments manage income (taxes), spending, and debt.

Why It’s Important:

1. Helps people make smart money decisions.
2. Enables businesses to grow and survive.
3. Keeps economies stable through financial systems.

Finance is about making money work for you, instead of just working for money.