A sacrament is an outward sign (something tangible to the senses) instituted by Jesus Christ to confer grace. Sacraments are the chief way that He communicates His life with us.
For example, in Baptism the outward sign is water, which is poured over the head in threefold action in the name of the Trinity.
In the Holy Eucharist, the outward sign is bread and wine which become the body, blood, soul, and divinity of Jesus by the sacred words of Institution.
In Confirmation, the outward sign is oil; when oil is placed on the forehead with the special prayer of consecration, the Holy Spirit is conferred.
In Holy Orders, it is the laying on of hands along with chrism oil to ordain a man to the priesthood.
In Holy Matrimony, it is the verbal exchange of vows between the man and woman, which marries the couple.
In Anointing of the Sick, it is the oil of the infirmed placed on the forehead and palms of the sick person.
Finally, in Penance, the penitent confesses her sins, and the words of absolution of the priest bring about forgiveness.
In order for the sacraments to be validly celebrated, there must be a union of matter, form and intention. The minister must intend to do what the Church does. The matter of the sacrament is an external action by the minister. The form of the sacrament are the sacred words that have to be used.
Finally, a delegated minister must celebrate the sacrament. For example, for Eucharist, Confirmation, Penance, and Anointing of the Sick to be validly celebrated, the minister must be a priest who has faculties by the bishop to celebrate these sacraments. In marriage it is the couple who marries each other, but it must be done in front of a validly ordained deacon, priest, or bishop. The deacon and priest must have proper delegation from the pastor or bishop of the diocese. In case of ordination, only the bishop has the faculty to do so.
Finally, in Baptism the ordinary minister is deacon, priest, or bishop. However, in cases of emergency anyone can perform a baptism if they do what the church intends by using water, baptizing in the Trinitarian formula, and pouring water on the head at the same time. The bishop has authority to celebrate all seven sacraments since he is the ordinary minister of all the sacraments. The purpose of the sacraments is to sanctify the faithful in life. Life is considered a pilgrimage, which has a specific beginning and end. For a Catholic, spiritual life begins at Baptism and ideally culminates in heaven around the Primordial Sacrament, Christ Himself. The sacraments nourish the faithful along the way so that they do not lose their way.