Three Simple Steps to Impact Investing

What is impact investing? Think of it as “Values Investing” or “Socially Responsible investing”. Or when it comes down to it, investing in companies that think as you do.

1. First, define what you mean by impact investing, what does it mean to you? Are you concerned about social issues, environmental or religious issues? Are you interested in medical or pharmaceutical companies? Do you support firearms? No matter what your interests are, there are stocks or mutual funds to fit your values.

2. Second, find an advisor that will listen to what interests you. If the first words out of their mouths are, “You can’t make money doing that!” Find someone who says, “I think we can find something to align with your values.” There are plenty of choices, and they are getting better all the time. Costs have come down and many are actively participating in the companies they hold as activist shareholders.

3. Third, after defining what you mean and finding the right advisor then start paying attention to the annual shareholder materials and proxy voting. The more active you are in learning about the funds you hold the more aware you can be about what you are supporting. Too many people invest in a fund thinking it is socially responsible, only to find out later it wasn’t what they thought it to be. An educated and open-minded advisor can help you before you invest.

Nothing is perfect, but you can feel good about the choices you are making and still invest wisely. It takes a little time and devotion but can be rewarding as well.

Are You Saving or Investing?

Every time you turn around the news seems to be worse about our economy, taxes, jobs, etc…. What do you do? If you have a savings account for emergency and/or current needs it should be in a money market or Certificate of Deposit. You’re already ahead of the game. Both are FDIC insured, up to $250,000, and are the most secure place for money you need in the next year or two.

But what about investing for future needs? The easiest way to give yourself options and more control when you do retire is by investing in retirement accounts. Everyone should have a traditional IRA or Roth IRA, you can start one as long as you have wages. If you are self-employed there are options for you. If you are retiring in the next 5 years this may not apply to you, but for those with 5 or more years to retirement you need to look closely at your retirement plan. Too many people wait until the last minute to plan out their retirement income and realize there were things they could have done to make it better. They start looking for investment’s that don’t exist. There is no such thing as no risk, high return investments. Where investors get in trouble is trying to find that one investment that will make up for time lost. Listen to the marketing messages out there. They play on people’s insecurities and fears and end up costing people their hard earned money. Your overall risk is actually lower the younger you are, which gives you more flexibility. If you are reading this and think I’m already old, then make sure you are teaching your kids and grand kids good money management. There is no age limit for clients in my practice. The younger the better.

How many times do you say “If only…..” it’s up to you to seek the information you need to have a powerful and effective plan. I can help you but only you have the power to make it happen.