Down to the Core

Why Your Core Values Are Important When it Comes to Spending and Making Money

by Meredith Morris

Financial Frequency. myInvestments

November 14, 2019 .2 min read

Do you know why you make the choices that you do? Do you make them based on ethics? Convenience? Looking towards the future? Or just because someone else told you to?

For way too long, savvy investing had nothing to do with what you believed to be important to the world. Money wasn’t moral.

So any feelings about just or worthy causes simply didn’t matter. Your views on gender equality, for example, or fair treatment for minorities or environmental care? Paying attention to them could only cloud a sound approach to personal finance.

Boy are those days gone.

Investing based on values isn’t just a thing. It’s now the guiding principle for many profitable portfolios. And if you pay attention to the new ways that stocks and funds are evaluated, you can make money and support your beliefs at the same time.

Look at how some of the country’s best performing companies got started — and how their operations stem from their founders’ personal convictions.

Like Patagonia, for instance. Its originators were surfers and mountain climbers, and they took to heart a mission to cause no unnecessary harm, and to help save the  planet. Virtually every decision they make is based on those core values. 

Indeed, ethics has emerged as a top priority for many when it comes to how we spend and manage our money. 

Fortunately, Wall Street has responded.

SRI’s or Socially Responsible Investments are based on a variety of factors related to the types of businesses they back, the products produced and behaviors of those involved. They look for firms, mutual funds and exchange-traded funds (ETFs) with integrity and progressive or socially conscious practices.

This practice of investing money in companies that have a positive social impact is becoming more and more popular. Popular SRI strategies tend to mimic the political and social climate of the time. 

One interesting fund is the State Street Global's Gender Diversity Index ETF, which was given the ticker SHE. This ticker tracks the performance of an index of companies that are leading the advancement of women through gender diversity on their boards of directors and in management. If gender diversity in companies is important to you, looking at companies with this ticker is a great place to think about investing. 

DSI is another ticker that tracks an index of companies that have what they say is “positive environmental, social and governance characteristics.” The fund began in 2006 and it’s got plenty of diversification.

If you’re more interested in mutual funds that are socially conscious, look at Portfolio 21 Global Equity Fund Class R (PORTX). PORTX “doesn’t invest in any company with a direct interest in fossil fuel exploration or production, the weapons industry or controversial labor policies.”

While there are plenty more SRI funds out there, it’s great to talk to your financial adviser about what works best for you and your financial future.

Where it’s where you shop or where you invest, start paying attention to your core values and if they align with where you are putting your money. 

There’s nothing more fulfilling than knowing you are putting your money into something you really care about, and it’s actually working for you and your future.

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