Your investments ideally should not only help you pursue your financial goals, but they should also match your values. For instance, consider the following two questions:
  • Do you think it’s important to safeguard the environment?
  • Do you believe it is important for a company to be a responsible member of its community?
If you answered yes to either of these questions, or if you find similar issues regarding a company’s conduct of importance, you might be interested to know that there are alternatives that allow people to reflect their personal values in their investment decisions. 

Various financial companies have developed portfolios that are “socially responsible” in light of investors’ concerns. These investments generally include (or exclude) specific securities from portfolios based on predefined social and/or environmental criteria, through a screening process. The result is investment portfolios that attempt to meet investors’ social criteria and target the returns needed to pursue their financial goals.

Given their emphasis on social issues, performance in portfolios of this nature will often not match those of the most highly touted performers. But for those who can accept reasonable returns, such investments are a great way to be true to the beliefs you embrace.