Financial services are the economic services provided by the finance industry, which encompasses a wide range of service sector firms that provide investment management and wealth management. They include credit unions, banks, credit-card companies and stock brokerage firms.
Banking is the most well-known category in this field, and it involves both handing deposits into checking and savings accounts and lending money to customers. It also involves evaluating the creditworthiness of customers for loans and determining interest rates. Banks need to keep about 10% of the money deposited into their accounts on hand at all times, as required by federal law, but the rest is available for loaning out.
Another area of the financial services industry is insurance. This includes policies that protect against loss of life or property (e.g., life and health insurance), and it also covers financial liability, such as automobile or homeowner’s insurance. Insurance agencies and brokers are involved in this area, as are underwriters.
A final aspect of the financial services industry is asset management, which involves taking funds from investors and using them to purchase and manage investments on behalf of those investors. This category also contains the brokerage and advisory services that help individuals and businesses make informed investment decisions based on their goals, risk tolerance and other factors. The financial services industry is vital to NYC and the world, and it can offer a highly rewarding career for those interested in the business of money.