The first tab in the Contact View is the Address/Phone tab. This is where you enter edit and view the addresses and phone numbers that a contact may have.
For each contact, CMS can keep track of as many addresses as you need. This gives you the flexibility to have endless accounts or addresses for each contact. These addresses are also used for keeping track of the payments and billing for the contacts. This means that while you are able to run a report on a contact to know how much was donated, that same report could be subtotaled to know how much came in from his business, from his wife or from his foundation account/address.
Each address is given an address type. These types are maintained in the address type list (Tools>Custom List Setup>Address Types). Different addresses types could include: a home address, work address, summer home, wife's work address, etc.