For an organization or an individual, the activity of financial management enables the firm to become able to make sound financial decisions and then go ahead and establish stability over time. For the former, to maximize profits while managing risk so that it can take on a stable, long-term growth opportunity becomes a prerequisite. The individual is closer to his personal goals, such as house purchase or retirement planning or a new venture, under financial management.
Good financial management is what helps businesses and individuals stay financially healthy, prepared for some unforeseen eventuality, placed for prosperity in the future, and puts their resources to optimum use. It is integral to any long-term financial planning since it presents an assurance that every resource can be used as intensively as it can possibly be used. more