Financial services are the broad industry of business sector firms that offer economic services related to finance. The industry encompasses a wide variety of professional firms, including credit unions and banks; brokers and insurance agents; investment managers; credit-card companies; credit-reporting agencies; and payment-system providers. This industry also includes accounting and tax filing services; currency exchange and wire transfer services; debt resolution services; and global payment providers like Visa and Mastercard.
Generally speaking, financial services are intermediary services that help channel cash from savers to borrowers and redistribute risk. Banks, for example, take on the risk of lending money to borrowers, and then pool that risk with other banks and lenders so that one bad loan doesn’t put them out of business. Insurance agencies provide intermediary services by offering coverage for big expenses that people can’t afford to pay themselves, such as medical bills and mortgages.
Financial services are a huge part of our economy, and there’s no doubt that they affect everyone—from the person in line at the bank to the CEO of a hedge fund. The pros of a career in this field are many, but it’s important to weigh the cons before you decide to jump in. It’s common for professionals in this field to work very long hours, and the demands of the job can cause a lot of stress. Plus, regulations can make it difficult for financial services to grow and innovate. But if you can manage to overcome these challenges, a career in this field could be very rewarding.