These days, finance seems to cover a multitude of operations and opportunities. It is fair to say that the procedures and the practices have changed drastically. It is also apparent that the industry has become almost a law unto itself in many ways.
Financial Services can be placed into seven principal categories:
- Commercial Banks (Banking).
- Insurance Companies.
- Investment Banks.
- Wealth Management and Planning.
- Brokers (Advisory).
- CPA Companies (Wealth management advisory).
- Financial Planning (Wealth management advisory).
These institutions deal with the management of money in every form, including credit cards and stocks and shares.
- How Do We Define Finance Today?
- The Services
- Financial Departments
- A Wide Range Of Operations
- Personal Banking
- Corporate Finance
- Public Finance
- Considering A Career In A Financial Institution
- Careers in Banking
- Why Are They So Well Paid At The Highest Level?
- The Qualifications
- Today’s Business World
- What Are The Working Options?
- Regulatory Bodies
- Life In The Fast Lane
- Entering Finance For The First Time?
- Final Thoughts
How Do We Define Finance Today?
Or put another way, what are the companies in the finance field and how do they operate? It can be defined in the same way as it has always been to a certain extent. That is providing governments, large and small companies, and individuals with financial services and assistance.
To list them all would take a book. And they differ from those offered to private individuals to those required by the larger corporations. But the principal services offered by financial institutions can be placed into many categories.
- Management of all Personal accounting issues.
- Property Finance and Management.
- Funds Management.
- Wealth Management.
- Money Distribution.
- Advisory on all financial matters.
- Hedge Trusts.
- Government Undertakings.
- Credit Unions.
Within even small firms, there is a level of financial management. In larger corporations, this can expand into many floors of people. All responsible for the financial management of the business and possibly, many subsidiaries.
At this level, the financial managers and their departments are there to ensure the company has adequate trading and management funding. They manage profit levels and expenditure and also advise on and conduct acquisitions.
A Wide Range Of Operations
I have not included every potential activity of financial institutions in this article. However, it is possible to appreciate the range of money-management and, of course, money-making activities and their involvement.
So, let’s break down the forms of finance and place them in three broad sectors. This will make explanations quicker and understanding their operations somewhat easier.
This is the most common form of banking that we are familiar with. To some, it is the face of banking. This is the branch where you can get access to your bank and deal with a human being, during office or shop hours.
Branch opening times vary geographically. In Europe, you will find them open normally between about 9 am and 4 pm Monday to Friday. Some will be open on Saturday, but rarely on Sunday unless in exceptional circumstances. In the US, there are similar times though you will find them open on Sundays in certain areas.
More than personal banking…
The branch offices are located in convenient places for the public to conduct their business. Personal banking will also include the option provided for mortgages for property, and insurances.
Banks normally issue cash cards, and they will provide credit card application facilities. They may also have or recommend an accountant if required.
This is the business aspect. Some personal branches carry their own Corporate department for the smaller business. However, large companies will be based in larger Corporate bank offices. Corporate divisions advise and help the customer to manage their business dealings.
This could include looking at income streams, costs, and overall profitability. They may make recommendations based on the information given to them. They will assess profit and loss and percentage profitability, as well as capital investment and investment portfolios. The management of Corporate Finance offices is run by bank directors, accountants, reporting to a Chief Financial Officer.
These are financial departments associated with the running of a country’s budget and treasury department. They oversee the workings of the national Central bank and other government departments with accountable budgets.
They rely on tax revenue and generating income through taxation. Money raised is spent, we hope, on national projects and utilities. These might include hospitals, roads, national health programs and social welfare, and other infrastructure.
Considering A Career In A Financial Institution
If you are thinking of a career in finance, then there are a number of avenues open to you. Choosing the right direction, though, is a bit more complex. Some people’s skills will definitely point them in one direction. Let’s consider the most important categories of the various financial services.
As simple as it sounds, banks where the customer goes to withdraw or make a deposit. Loans are negotiated, and other simple financial management controls are implemented.
Usually working for a consultancy but sometimes with mainline banks. They assist in investments, mortgages, and property sales and assess potential investment opportunities.
Capital Management Advisors
Advising on investments and the best way to make a return from them.
One of the most high-profile actors of financial services and something that just about everybody has during their lifetime. This could be for life or health but also includes the house, the car, and any other asset. Policies can extend in protecting yourself from default on payments and rental agreements.
Careers in Banking
These, as we can see, are wide-ranging and offer different benefits. Some institutions are amongst the highest paid salaries around. But don’t think for one moment you get it for nothing. I am not going to list every single job opportunity that exists in the industry; there are far too many.
But they range from clerical positions through to management in the Personal banking scenario, through to the Senior Corporate level. In some areas, the salaries and the stakes are high. And it is important to remember that in certain financial fields, the financial institutions themselves are competing and fighting for business. Sometimes literally, against each other.
Why Are They So Well Paid At The Highest Level?
Because as I have just mentioned, the stakes are high. Money is everything in some circles. Therefore success in whatever financial field you are in is not optional. It is demanded. And those that can provide success are rewarded handsomely.
Creating a firm, stable financial base for a company is no easy task. It requires very special skills. Investments can be a complex issue, and it takes excellent analytical skills to measure their potential. This is why the best are known as financial experts. They have to earn that title.
As you might imagine, the qualifications required to enter this profession are quite high. And over the years have risen even higher.
Starting with a minimum of a BA, Bachelor degree, you might also be expected to hold or train for the following:
- B Com Commerce Bachelor’s Degree.
- MBA Master of Business Management.
- CPA Certificate in Public Accounting.
- FMVA Financial Simulations and Valuation Analysis.
Today’s Business World
This is a vastly different financial place even to what our parents knew. The expansion of money-making opportunities has trebled in a very short time. But you do have to be careful.
There are plenty of organizations that run schemes that, shall we say, are less than legal. And those schemes often tempt their staff with huge promises of personal wealth. That would be your decision, but be careful as I say.
What Are The Working Options?
Defining job functions in the finance sector can be very complex. Many of them overlap each other in activity and responsibility. It is, therefore, quite hard to put functioning labels on them.
But working in finance is not all about dealing with customers for personal banking or handling large portfolios. There are plenty of other positions that might appeal to suit your individual skillset.
As Self-Employed or Running Your Own Business
- Starting up your own Accountancy Practice.
- Creating Software and Packages that support Financial Applications.
- Writing books, pamphlets, and instruction aids for Finance Practitioners.
- Have your own online Blog or Vlog.
- Publish your own Financial magazine.
- Have a consultancy assisting with Re-mortgages and Debt Restructuring.
- Finance Consultancy covering aspects from Budgeting and Debt Control to Investments.
- Tax Consultancy.
- Investment Portfolio Management.
- Risk Control and Management.
- Personal and Small Business Credit Repair.
- Financial Planning for Pensions, Insurance, Inheritance Tax, etc.
- Conversion Rate Trading.
- Finance Journalism (It is different from a freelance writer as you will write for newspapers).
There will also be opportunities to work in regulatory bodies. Most countries have some form of a regulatory body that controls and supervises financial activity. In the UK, there is a small number, but in the US, a large amount, some would say far too many. Nevertheless, opportunities sometimes exist to work in those environments.
Life In The Fast Lane
This is what working in finance can be. And as I have already commented, there will be little room for a lack of performance. Of all the industries, working in the Financial sector can be ruthless at times.
The other side of that coin, though, is the rewards can be high. For those that enjoy meeting the public, there are some eminently suitable jobs. For those that just enjoy playing with numbers and creating ‘what-if’ scenarios, it also fits.
Good reading material…
And if you are a ‘specialist’ with Excel and all its many attributes, you may well find yourself in demand. If you would like to look at the Financial world a little more closely, then there is some good reading material such as Corporate Finance (4th Edition), Accounting QuickStart Guide: The Simplified Beginner’s Guide to Financial & Managerial Accounting, and A Beginner’s Guidebook to Personal Finance and Money Management. All of which will certainly give you plenty of insight.
Entering Finance For The First Time?
If Financial Analyzing is your niche, we found some excellent guides to help improve your skillset, such as the CFA Confidential: What It Really Takes to Become a Chartered Financial Analyst, the Financial Analyst’s Indispensable Pocket Guide, Absolutely Legendary Financial Analyst, or Financial Intelligence all available online in 2023.
Or maybe you’re interested in becoming a Financial Advisor, for that we have The 10X Financial Advisor: Your Blueprint for Massive, Succession Planning for Financial Advisors: Building, The Financial Advisor’s Success Manual: How to, or what about The New Financial Advisor, the Succession Planning for Financial Advisors: Building, and The Million-Dollar Financial Advisor: Powerful Lessons.
But that’s not all; we also recommend the Knock Out Networking for Financial Advisors and Other, The Ultimate Financial Advisor Marketing System, the Prospecting Through Positioning For The Financial, and the Success as a Financial Advisor For Dummies, also available online today.
The growth of the financial sector has meant an increase in employment opportunities. It has also generated diversity. People and businesses are now much more aware of financial responsibility and outcomes. More people are also investing than ever before.
All of these scenarios and others need advice and management. The Financial sector provides it, and the growth of this aspect of the industry is likely to increase even more in the foreseeable future.
All the very best with your future in Finance!