There is a great deal of variety in the world of financial services. Many professionals who choose to work in the field find it very fulfilling, with job satisfaction ratings often ranging between 9.6 and 10. It can be lucrative as well; those entering the industry are likely to be paid a good amount, especially if they have taken the time to train themselves before they began working in the sector. In addition, many positions are highly portable and offer the opportunity to move from one location to another with relative ease.
Generally, financial services refer to any company or entity that deals with money management and investment. This includes everything from banks, credit unions and mortgage companies to credit card companies and stock brokerage firms. It also includes firms that provide investment and insurance products, as well as those that handle payment processing and other forms of financial intermediation.
Financial services are very important to our daily lives. We depend on banking, credit card and mortgage loans to help us afford the things we want in life. We rely on insurance to act as a safety net in case something goes wrong; whether it’s health, auto or home insurance. It’s important to understand the differences between financial services and financial goods as well. A good is any object that you purchase or possess, while a service is anything that supports that good. For example, a mortgage is a financial good, but all the services that go into supporting that mortgage (like securing the loan, insuring the property and inspecting it) are considered financial services.
The broader definition of financial services encompasses an array of activities that are essential to the economy. It is comprised of thousands of depository institutions; providers of investment products; insurance and credit-card companies; and a host of other lenders and intermediaries that make up the finance market.
These days, it seems as though all entities in the financial services industry have a lot of overlapping functions. This wasn’t always the case, however. For a long time, each sector stuck to its specialty. Banks primarily handled deposits and checking accounts, while loan associations offered mortgages and personal loans. Insurance companies specialized in life, automobile and home insurance while brokers provided investors with access to stocks, bonds and mutual funds. Credit card companies focused on providing credit cards, and payment processing firms like PayPal facilitated payment transactions.
Nowadays, however, it’s fairly common for a bank to also offer a wealth management department and mortgage lending. These new offerings allow consumers to get all of their financial needs met in one place, which saves both time and energy. In turn, this can help increase customer satisfaction and boost the company’s overall profits. Consequently, the expansion of these offerings has made it possible for companies to be more competitive in the financial services sector as a whole. This has led to an increased number of jobs and an improved economic outlook.