General Terms of Financing: Know More About Them

In financing, there are a lot of factors and general terms that can be used. It depends on what term you typically apply to them, but mostly, in this article, are the common ones. So to understand much more about them, you will have to familiarize each of them that is potentially present in your status. To get started, make sure that you have everything cleared on your mind so that everything we tackle here can be absorbed by your memory.

Income – it is where your budget and where your cash flows. It is generally the source where you get to buy everything you want. From groceries up to other things that you can want to buy, it’s really up to you. A quick tip would be – save more than what you can spend. This is a must and you may need the money in times of emergency or starting out a new business. Generally, income comes in three ways, selling services or labor, lending or cash loans, or selling goods and things that can generate enough profit or turn the workflow of your business.

Expenses – these are the things that take or use your income. In other things, these are the ones which are your needs or entertainment. If your income is greater that your expenses, then it’s a big plus. We call it budget surplus, but if your expenses is greater than your income, it’s a different story, and we call it budget deficit. Advice – you must keep your budget surplus in times you could use it desperately.

Assests – it’s anything in your possession which gives you income. These could be cars, your house or your business. Though there are many factors that make up this term, it is mostly regarded as anything tangible.

Equity – is a portion of business in which you own. It is mostly called corporation on company. Some hold other stocks, some hold the services, some hold other department.

Those are just the common terms used in financing and investing. For more information, you can watch the video below.

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