The concept of time, money and risk management is known as finance management. Study of finance teaches people how these three parameters are inter-connected to each other. The study explores on a precise explanation of the branches of finance.
Good knowledge on the branches of finance helps you proper management of your capital and secure it as well. Whether you are student, corporate person or someone who is far away of the field of finance, you must know about finance and its branches.
This will help you to maintain your capital in an accurate manner and secure your future. In the field of Finance, there are countless branches and sub-branches available. Many different scholars and finance experts categorize them as per their requirements.
But, most of them are agreed and follow three major categories. In this lesson, you will learn the categories and the fields of the studies. This will help you getting good knowledge about the ares of finance, applying on your real life and manage your capital appropriately.
Branches of Finance and the Field of Studies
- Personal Finance
- Corporate Finance
- Public Finance
What are the Branches of Finance?
Personal Finance
Personal finance deals with the concept of all personal expenses and money management. You are paying for education, real estate or saving money for retirement are considered as personal finance.
All the activities you do for your personal improvement; leisure or better future is considered as personal finance. Some major fields of personal finance are Health Care, Education, Real Estate, Travel and Purchasing Goods for daily life.
The field of study related to Personal Finance stands for some key points are listed below.
- Finance Position: This point stands for the understanding of the net worth and cash flow of household. Without this knowledge you cannot maintain your cash flow for better purposes. You need to read and learn about finance position and try to maintain a strong finance position.
- Tax Planning: Tax planning is an important field of finance study. Everyone must learn properly. People often plays a careless role in terms of Tax management. But at the end of the day you pay it that impacts on your finance position negatively.
- Investment Planning: Study of investment planning is essential that protects your capital and teaches you proper risk management. Investment planning helps you maintain the proper cash flow and fulfill the requirements appropriately.
- Adequate Protection: Everyone wants security on their investment that you can only assure with the proper knowledge of Personal Finance Management. You will learn about your capital protection and capital management on the field of Personal Finance.
- Retirement Planning: You work hard for years to secure your future, especially on your retirement period. If you can’t assure a good house and enough balance for your retirement times, you will suffer a lot! So, you need to learn about retirement planning to secure better future.
Corporate Finance
All the studies related to business financing is the plot of Corporate Finance. Any type of business investment, profit management, stock values are considered as Corporate Finance. You must need Corporate Finance knowledge to start any type of business.
This principle helps in proper risk management that ensure proper business growth. Thus, Corporate Finance is essential and primary condition to start a business. This major branch of finance helps a corporation to make their business profitable.
Knowledge of Corporate Finance also reduce the risk and balance the finance growth that is important. Corporate Finance has some major fields of study and plot that is listed below.
- Fund Management: Fund management is the initial and essential stage of Corporate Finance. You must ensure good cash flow from dependable sources and manage them in a disciplined manager. This will ensure proper business growth. Thus the study of fund management is important.
Without proper fund management, the business management is hard and quite impossible. This is the reason you have to ensure proper funding for your business.
- Risk Management: Risk Management is another essential and crucial factor of corporate financing. This could make a huge difference for your business and impact negatively or positively. Before starting any business, you have to learn risk management properly.
- Profit Management: Profit and Loss are closely inter-connected with businesses. Either you make loss or profit, you need enough knowledge on it. Profit management helps on quick business growth.
- Understand Economic Trends: Understanding the economic trend helps to make a business successful really quick. This is the reason on should study about economic trends. Few experts consider this as the best business secret for them.
- Maximize Stock Values: Possibly this is a dream of every business owners and everyone wants their stock value high. So, you need to learn about this branch of Corporate Finance as well.
- Investment Portfolio: Investment portfolio helps in fund management, understanding the economic trends and proper investment on next project. Every finance expert should read about investment portfolio and apply on Corporate Finance Management.
Public Finance
All the studies of finance related to public properties like Government Agencies, Public Schools, Government Buildings are covered under the Public Finance. Some typical arenas like Insurance, Banking, Large Volume Investments are involved on Public Financing.
The Study of Public Finance is essential because a lot of concern is related with Public Finance. Lots of organizational and national interest is involved on it. Thus, this branch of finance is important. Lots of skills and abilities are required before you take any action with public finance.
Your field, proper decision making and changing the focus can impact on it. The ability of proper decision making is always plus point on Public Finance Management. Also, the non-government corporation finance could be considered as Public Finance depending circumstances.
Major Fields of Public Finance:
- Government Projects
- Funding on Public Entities
- Government Agencies
- Investment Banking
- Larger Corporate Finance
- NGO and Social Agencies
- Banking Activities
The study of finance is essential on our daily activities and thus the branches of finance as well. Knowing the ares of finance helps to learn and practice the finance activities more accurately. Also, helps to make profit on financial activities.
Related:
Sources: https://fundamentalsoffinanceandinvestment.blogspot.com/2018/09/three-branches-of-finance.html
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