Sources of Finance for Individuals - JSS3 Business studies Lesson Note

Income: The primary source of finance for individuals is their earned income from employment or self-employment.

 

Savings: Accumulated funds set aside from income for future use, typically held in savings accounts, certificates of deposit (CDs), or other liquid assets.

 

Investments: Individuals can generate additional income and build wealth by investing in various assets such as stocks, bonds, mutual funds, real estate, or retirement accounts like 401(k)s or IRAs.

 

Loans and Credit: Individuals can borrow money from banks, credit unions, or online lenders through personal loans, credit cards, home equity loans, or lines of credit. However, borrowing should be done responsibly to avoid excessive debt.

 

Family Support: Some individuals may receive financial assistance from family members or inheritances, which can supplement their own resources.

 

Government Assistance: Depending on eligibility criteria, individuals may receive financial support from government programs such as Social Security, unemployment benefits, or welfare assistance.

 

Side Hustles: Many individuals supplement their income through part-time jobs, freelance work, or gig economy platforms like Uber or Airbnb.

 

Crowdfunding: In recent years, crowdfunding platforms have become popular for individuals to raise funds for personal projects, emergencies, or entrepreneurial ventures by pooling small contributions from a large number of people.