Faith-Based Financial Investing
Back by popular demand! Here is a repost of an older article “Biblically Responsible Investing.”
The Bottom Line
Faith-based financial investing provides a meaningful way for individuals to integrate their religious beliefs with their financial decisions. By choosing investments that reflect their values, faith-based investors can support positive change while achieving their financial goals. As the demand for ethical and values-based investing continues to grow, more resources and opportunities are becoming available, making it easier for investors to align their portfolios with their faith.
What is Faith-Based Financial Investing?
Faith-based financial investing, a type of values-based investing or ethical investing, is a strategy that aligns investment choices with religious beliefs and moral principles. This approach allows investors to support companies and initiatives that reflect their faith while avoiding those that conflict with their values. Faith-based financial investing has become more widely used as more individuals seek to integrate their spiritual and ethical convictions into their financial decisions, creating a large impact worldwide.
Principles of Faith-Based Strategies
Faith-based financial investing typically involves two main strategies: positive screening and negative screening. Positive screening includes investing in companies that align with faith-based principles and contribute positively to society, such as those involved in humanitarian efforts, environmental sustainability, ethical business practices, and pro-life principles. Negative screening involves avoiding investments in companies or sectors that contradict religious values, such as those associated with tobacco, gambling, pornography, abortion, and more.
Benefits of Faith-Based Financial Investing?
Alignment with Values: Faith-based financial investing allows individuals to align their financial decisions with their religious and moral beliefs, creating a sense of harmony between their values and investments.
Positive Impact: By investing in companies that adhere to ethical practices and contribute positively to society, faith-based investors can help promote social and environmental change.
Community Building: For example, Faith-based financial investing can foster a sense of community among like-minded individuals who share similar values and goals. Connecting with others to stand together on Kingdom issues can create the largest impact.
Common Concerns about Faith-Based Financial Investing
Limited Options: Depending on the specific criteria and values, finding suitable investment opportunities that align with one's faith can be challenging and may require extensive research or professional help. It can be vital to find a financial advisor who specializes in helping you find investments that match your values.
Performance Concerns: Some investors worry that restricting their investment choices based on ethical criteria might limit their portfolio's performance. However, research has shown that faith-based and socially responsible investments can perform competitively with traditional investments.
Understanding company policies: Navigating the various guidelines and principles of the companies you invest in can be challenging, and it can be difficult to identify all of the ways that a company supports or rejects Christian values in its business practices. Choosing a financial advisor who can help you navigate this can make all the difference. Download a sample Impact Report here and let us help you begin to identify how you can invest according to your pro-life values!
Ideas For How To Get Involved With Faith-Based Financial Investing
To get started with faith-based financial investing, consider the following resources:
Faith-Based Mutual Funds and ETFs: Look for mutual funds and exchange-traded funds (ETFs) that specifically cater to faith-based investors. These funds typically screen for companies that align with religious values.
Financial Advisors: Seek out financial advisors who specialize in faith-based financial investing and can help tailor a portfolio to your specific values and goals.
Get Educated: Reading books like “Biblically Responsible Investing” and following blogs like this one will help you better understand how faith-based financial investing is not only important, but easier than ever to do.
What sets faith-based financial investing apart is the intentionality behind every decision. It’s not just about avoiding "sin stocks" or unethical companies; it's about proactively seeking out investments that align with Christian values. This might include companies known for fair labor practices, those that are environmentally responsible, or those that contribute to positive social change rooted in biblical values. By doing so, we can ensure our investments are a true reflection of our faith.