The world behind Finance and Banking

When it comes to growing up a lot of people thing of the words financing and banking which can be a scary term if you don’t know what you’re doing. Financing can also be known as credit which when not handled with care lead to a world when you’re trapped in a never ending debt spiral which can just grow and grow until you have no money to pay your bills and you have to file bankruptcy.

In banking start off early if you can for example start an account when you’re 16 even if you add a little bit each month they’ll add money only about 10 cents every few months but it adds up and sometimes can be as much as 20 dollars depending on how long you’ve had an account with them. But once you reach the age of 18 you can start a secured credit account with them when you give them money that is already yours and they treat it as if it is a real credit line. Financing can also mean starting loans and this is a process.

When thinking of loans you think of maybe a mortgage or getting a new car that requires payments. The payments mean you financed the car and to finance the car you have to get accepted by a bank to go through them in this loan and financing process. Banking is usually thought of a highly secured business that holds money some may even picture a lock box with your money and when you want it they unlock it but that isn’t the case. Tha bank takes in money and it’s in an account how much of it belongs to you. Kind of like debit versus credit. A debit card goes through your banking and it is your money but rather than going to the bank to get money withdrawled you can spend it using your debit car. A credit card is essentially the idea that you’re spending money that doesn’t belong to you but you have to pay back. It reminds me of going to the bank getting money that doesn’t belong to you but could have previously belonged to someone else and they possibly deposited it into the bank.