Providing financial services is an important function of an economy. This service helps producers to get capital and promotes the investment of consumers. It also serves as a safety net. It provides protection against natural calamities and business conditions.

Financial services are offered by financial institutions, such as banks, insurance companies, and mutual funds. They help borrowers get loans, and they offer advice on saving. These services promote investment, which results in the growth of the economy. They also help promote foreign trade.

The financial sector is a large one, covering a variety of industries and job functions. Some of the key roles include investment managers, financial advisors, and financial planners. These individuals oversee the portfolios of their clients.

Financial services are divided into two sectors: personal and corporate. There are several types of financial services, including investment management, asset management, and insurance. Each type of service requires a different skill set and knowledge base.

Asset management is the management of assets, such as insurance assets, mutual funds, and pensions. It also involves managing client portfolios during unusual times. These assets include stocks, bonds, and commodities.

Insurance companies provide coverage for people against natural calamities, as well as large unforeseen expenses. These companies can minimize risks by pooling cash and paying policy holders. These companies also help minimize risks of producers.

The financial services industry is large, with more than eight million employees in the United States. It serves consumers, businesses, and nonprofits. It can be confusing to enter, so it’s important to understand the key roles and responsibilities.