Your Finance and You

Finance can be simply defined as some things that deal with money time and risk in a single platform. This being the case, there are different platforms of finance that can be found in an organization. These platforms will also vary according to the needs of the organization and its requirements. Most of finance is divided into personal, business, corporate and public finance. These platforms of finance have different characteristics. However, they are based on more or less the same principals. The overview of finance is simple and it can be understood by an average individual. 

 

Finance is basically an aspect of business management. This means that an organization or an individual will have to know how finance works in order for them to understand its impact in their life. It is mainly associated with the acquisition and the use of funds of a business entity or an individual. In finance, there is the income that is generated and the expenditure. Income is the amount of money that has been gotten in total. This can be through payments for goods and services. The expenditure is the amount of money that has been used to generate the income. It can come in terms of costs of buying goods, expenses while providing a service or use for any other business that was related to the generation of income. 

 

Finance management is the act of making sure that the income is higher than the expenditure. When the income is higher than the expenditure, it means that the entity is making a profit. This is in turn means that the entity is able to run comfortably on its own. An entity that is running on its own has good financial management and smooth running of other branches of business. However, when the income is lower than the expenditure, there is poor management of finance and the business in general. Entities that make losses are those that experience this situation. To avoid it, the entity will have to know why there are expenses which are exceeding the income. 

 

Finding out where the problem lies should not be a difficult task. In most cases, the problem is a result of spending too much money on the expenses. The costs of running the entity should be reviewed and adjusted. If this does not work, then the products being offered should have an adjustment on price. When these two things are implemented, the entity will start recovering and making profits.