What is money

What is money?
Money is any article, generally accepted, that is used to purchase goods and services.

Why do we use money?
We use money because in many cases, it is more convenient and practical than trading goods. In trading goods and services, the person we may need to trade with may not want what we have to offer. Also, some goods may be too difficult to move.

How do I make money?
There are many ways in which you can make money. Most ways, of course, would entail some degree of work on your part, depending on how much money you want to make.

Aside from keeping a regular job, you could either start your own business or make sound investments in stocks, bonds or even real estate. Your bank or a financial adviser can help you build your investment portfolio.

You can also make extra cash by selling your unwanted goods through a garage or car boot sale or through an auction. On-line auctions are also available these days but try to stick to well-known websites.

What do banks do?
The primary function of a bank is money borrowing and money lending. The bank pays interest on the money you loan them and charge interest on the money you borrow from them. Some banks specialize in one particular aspect such as financing only agriculture, industry or foreign trade. However, commercial banks concern the general public and business communities the most.

What is credit?
Credit is the bank’s level of trust in your ability to meet payments when due. Your credit rating is affected by how consistent you are in paying your bills on time.

How do I improve my credit rating?
Your credit rating will improve when you consistently pay your balance on time each month.

What is a credit report?
Once you apply for a loan or credit card, you have a credit report. This contains all your credit information. Your negligence to pay a bill is noted in your credit report, and your credit rating goes down.

What is an investment?
An investment is money that is put into business, stocks, etc. in order to earn a profit. When the business or person you loaned your money to has earned a profit from your money, he will give you a portion of that profit.