Howto Invest for Good
Save for the future and support a cause
YOU WANT TO SUPPORT CAUSES YOU BELIEVE IN— BUT
STILL MAKE STRIDES IN YOUR LONG-TERM SAVINGS? WITH IMPACT INVESTING, YOU MAY BE ABLE
TO HAVE YOUR CAKE AND SHARE SOME TOO.
A NEW STYLE OF INVESTING, called impact investing (consider it an offshoot of the more widely known socially responsible investing), makes it easier to support causes you believe in—and get a return on your hard-earned dollars.
In the early days of socially responsible investing, people would pull out big categories of stocks they found objectionable— Big Tobacco, for instance—and not be too concerned about whether the remaining companies were working toward positive change, says Jake Raden, co-lead of the impact team at the investing platform Swell. But for many people, this is no longer enough. They want to proactively put money behind causes they care about—say, invest only in clean-energy companies or firms that pay employees well. Now it’s possible to do just that in a matter of minutes (no fancy investing insights required), thanks to online platforms that offer diversified portfolios and transparent info about fees and performance.
And when it comes to performance, don’t worry you’ll have to sacrifice your returns, says Dave Nugent, head of investments at the online platform Wealthsimple. “What we’ve seen from our client base is that people who believe in more than just investing for returns end up having better outcomes,” he says. “That’s probably because they’re less likely to pull out money when the market dips, since they’re investing for more than just returns.” Read on for ways to invest no matter your goal.