At SageSpring Wealth Partners, we believe in the power of making an impact with your dollar. Where you spend and invest your money matters. That’s why it’s so important to make sure that you’re investing in companies and organizations that align with your personal values.
You may have heard that Generation Z is on a mission to make an impact on the world—especially when it comes to how they spend their money. A recent survey by US Bank found that active Gen Z investors want to invest in things they care about and 85% would accept returns on investments that differ from the S&P 500.1 Let’s face it: the younger generation is creating their financial portfolios with their values top of mind. And you can too.
In recent years, the financial industry has seen a major shift in the market as more people begin to align their money goals with their values to make an even bigger impact. We want to help you understand how you can do just that through sustainable investing strategies.
What Is Sustainable Investing?
Sustainable investing is a type of investment that enables you to align your money with your values in order to have a greater impact on the environment, society, and governance (ESG) aspects of the economy. Another term for this concept is “values-based investing.”
Many investors believe that their dollar is their vote. Where you spend your money and what you invest in can make a huge impact on the world. That’s why it’s so important to make sure you’re working with a financial advisor who shares your professional and personal beliefs. They can help you find sustainable investing companies that align with your values while steering you away from others who don’t.
How To Get Started With Sustainable Investing
Sustainable investing may sound like just another new investment strategy to keep up with, but if you care about how your dollars impact the world around you, it’s a worthy pursuit. Here are a few easy steps to get started on your values-based investing journey.
1. Know your values.
To get started with sustainable investing, you have to know what your values are. Spend some time thinking through your core beliefs and how they could have an impact on your family and even your greater community. Knowing your values will help you discover your own set of dos and don’ts of investing as you begin your journey.
2. Do your research.
Doing your research on the companies you’re investing in is important. What are their corporate values? Where do they spend their dollars and what impact are they making on society? Once you have answers to those questions, compare them with your core values. Do they align?
3. Find a financial advisor who aligns with your values.
Knowing the heart of who is on your money team is a big deal. When your dollar is making a financial impact on your family, impacting your future, and even the future of the world, you want someone on your team who truly cares about your values as well. Asking them about their values is a great way to see if they’re a good fit for you and your family.
Sustainable Investing Strategies
If you’re serious about making sure your values and your investments line up, it’s time to talk strategy. Here are a few sustainable investing strategies to discuss with your financial advisor as you move forward:
Environmental, Social, and Governance Investing (ESG)
This is a form of investing that takes the environment, society, and government into consideration when diversifying your portfolio and choosing which companies to buy into. Companies who care about ESG are doing their best to make a positive impact on environmental issues like climate change, social issues like human rights, and even government issues like standing by or against certain laws.
Impact Investing
This sustainable investing strategy is great if you’d like to achieve your financial returns while supporting companies that are making an impact. For instance, maybe you care about renewable energy. If that’s a value of yours, you might invest in a company that’s leading the cause and making strides while giving you returns on your investment.
Socially Responsible Investing (SRI)
This is a type of investing that keeps social impact at the forefront of your investing strategy. You may care more about your values and ethical considerations than you do your return on investment. This type of strategy considers that the return on investment isn’t just financial, but societal change.
If you want to consider sustainable investing strategies, we can help. Find a SageSpring Wealth Partner in your area today and we’ll help you invest with impact for tomorrow.
Incorporating sustainable investing criteria into the investment selection process may result in investment performance deviating from other investment strategies or broad market benchmarks.