What to avoid
Then there’s the approach of limiting what you’re willing to invest in. Traditionally, this mostly comprised of “sin stocks.” Sin stocks are industries that are seen by many to provide some sort of cultural or social negative. It often includes weapons manufacturers and suppliers, tobacco, and alcohol. However, nowadays, sin stocks aren’t considered entirely negative to investors.
For one, they’re considered a lucrative option. On the other hand, many of these companies practice internally ethical practices that offer real support to the community. Which companies you decide not to support in principle is entirely up to you. But a closer review of individual organizations rather than a blanket ban, as far as your finances are concerned, could help highlight the different shades of good and bad in every industry.
What to expect
Most are going to anticipate that some kind of self-sacrifice is expected when it comes investing in social good and responsible industries. Indeed, the returns often aren’t as high as those portfolios aimed entirely at maximizing your financial growth as much as possible.
Take a closer look at the benefits of investing in SRI vs. Sin Stocks at investopedia.com to get an idea of what you can expect. But be aware that there are several SRI funds and groups out there have managed consistent returns for their investors year-on-year. It’s not a zero-sum game. You can see plenty of growth and ensure yourself a better financial future with SRIs, so don’t fear that you’re just throwing your money away.
Finding your balance between the good you can provide the world and the good you can do for yourself is all up to you. Above are just some of the ideas you can contribute, but there are funds and investment groups looking at new ethical ventures all the time worth investigating.
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