TINY
learning about finance will only make smarter
By Akshat Chourasia
Defination
Finance is the art of managing money — how we earn it, save it, spend it, invest it, and plan for the future.
What is Finance?
Finance is the study and practice of how individuals, businesses, and governments manage money and other financial resources. It involves planning, budgeting, saving, investing, borrowing, and forecasting to make informed decisions about money — both for the present and the future.
Finance is usually divided into three broad categories:
Personal Finance (how a person manages their income, expenses, savings, investments, insurance, etc.)
Corporate Finance (how businesses raise capital, invest in growth, and manage profitability)
Public Finance (how the government earns and spends money to manage the economy)
why learning it will make you smarter?
ever wondered “Why is it that people with even a basic understanding of finance seem to make sharper decisions—not just about money, but life in general”
Because finance teaches you how to think in terms of value, trade-offs, priorities, and consequences.
When you learn even the basics of finance — like budgeting, investing, compounding, or risk vs. reward — you start applying these same principles to everyday life. It’s like putting on a new pair of glasses that helps you see things more clearly.
Here’s how:
You start thinking long-term.
Just like investing rewards patience, life rewards consistent habits. People with financial awareness are more likely to delay short-term pleasure for long-term gain — whether it’s money, career, or relationships.You learn to weigh costs and benefits.
Should I spend time on this? Is this effort worth the return? Finance sharpens your decision-making by training you to look at trade-offs logically.You become less emotional with decisions.
Markets go up and down, and so does life. Financial thinking teaches you to stay calm during ups and downs, make rational choices, and not act on impulse.You stop wasting resources.
Just as you wouldn’t invest in something with no returns, you become more mindful of where your time, energy, and attention are going.You manage risks better.
Whether it’s taking a career leap, starting a business, or even choosing a life partner — finance teaches you how to evaluate risks instead of avoiding them blindly.
basic finance concepts
Now you know the reason why learning about finance will make you smarter now let’s start by learning basic concepts of finance that are used in daily life.
1. Budgeting (बजट बनाना)
Planning how much to spend and save every month. Whether it’s managing household expenses, groceries, or planning a trip — this is budgeting in action.
2. Savings (बचत)
Keeping aside a portion of your income for future needs or emergencies. Common tools in India: Bank savings account, Fixed Deposits (FDs), Recurring Deposits (RDs), etc.
3. Interest (ब्याज)
The extra money you earn on your savings (like FD) or pay on loans (like home loans or EMIs). Knowing the difference between simple and compound interest helps you make smarter decisions.
4. EMI (Equated Monthly Installments)
Most Indians are familiar with EMIs — for phones, bikes, homes, etc. Understanding EMIs helps you avoid taking on too much debt.
5. Credit & Loans (उधार/ऋण)
Knowing when and how to take a loan (personal loan, gold loan, home loan) and the importance of repaying on time to maintain a good credit score.
6. Investment (निवेश)
Putting money in something that grows over time — like mutual funds, stocks, real estate, or even a PPF. It’s the smarter alternative to just keeping money idle in your account.
7. Insurance (बीमा)
Whether it’s health, life, or vehicle — insurance protects you from unexpected financial burdens. It’s a safety net, not an expense.
8. Inflation (मंहगाई)
Prices rise over time. What ₹100 buys today won’t be the same five years later. Understanding inflation helps you see why just saving isn’t enough — you need to invest.
9. Tax Planning (कर योजना)
Using options like 80C (LIC, ELSS, PPF, etc.) to legally save taxes and plan finances smartly — something every salaried Indian should know.
Even without formal education in finance, we’re already using these concepts. Imagine how much smarter we’d be if we understood them properly!
Types Of Finance
1. Personal Finance
Managing your own money — how individuals and families plan for expenses, savings, and investments.
Examples:
Budgeting monthly income
Saving for children’s education
Taking a home loan
Investing in SIPs, FDs, or gold
2. Corporate Finance
How businesses manage their money, investments, and financial planning to grow and stay profitable.
Examples:
Raising funds for expansion
Managing company expenses
Deciding whether to buy new machinery or take a loan
Handling payroll and budgeting
3. Public Finance
How the government collects revenue (like taxes) and spends it on development, infrastructure, subsidies, etc.
Examples:
Union Budget
GST collections
Government schemes like PMAY or PM Kisan
Funding for railways, roads, education, etc.
The Bottom Line
Finance isn’t just about numbers or complex jargon — it’s about making better decisions every day. Whether you’re saving for a future goal, running a business, or simply trying to avoid unnecessary debt, a basic understanding of finance can change your life.
From knowing how to budget, to understanding the different types of finance — personal, corporate, or public — it all comes down to one thing: being in control of your money instead of letting money control you.
The good news? You don’t need to be an expert. Just start small, stay curious, and keep learning. Because once you understand finance, you’re not just managing money — you’re building a smarter, more secure future.
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