1. Banking and Loans: Financial mathematics is used to calculate interest rates, loan repayments, and amortization schedules. Understanding these concepts is crucial for both lenders and borrowers to make informed decisions about loans and mortgages.

2. Investments: Investors use mathematical models to analyze the performance of stocks, bonds, and other financial instruments. Techniques such as net present value (NPV) and internal rate of return (IRR) are used to evaluate the profitability of investment projects.

3. Risk Management: Financial institutions use mathematical models to assess and manage risk. Techniques such as Value at Risk (VaR) and stress testing help in identifying potential risks and developing strategies to mitigate them.

4. Insurance: Actuaries use financial mathematics to calculate insurance premiums, reserves, and policy payouts. By analyzing statistical data, they can predict the likelihood of events such as accidents, illnesses, and natural disasters, and set premiums accordingly.

5. Derivatives Pricing: Financial mathematics is used to price derivatives such as options and futures. Models like the Black-Scholes formula help in determining the fair value of these complex financial instruments, enabling traders to make informed decisions.