Tag: investing for millennials

Influential Women in Impact Investing

Published in: Resources |

Once viewed as a “finance backwater,” impact investing has come to the forefront as the world collectively comes to grips with issues exacerbated during the COVID-19 pandemic — from climate change, to systemic racism, to gender diversity in the workplace, to unequal pay, to food insecurity.

While impact investing is now a hot topic (it has $502 billion in assets under management globally), women have been leading the way in this field for decades. Women have been better represented in impact investing possibly because “this sector is inherently — perhaps by design — more diverse and equitable,” Irene Mastelli of Phenix Capital explains.

The list of women shaking up the impact investing field is endless, and we’d never finish this blog post if we listed them all (check out this article for a list of some of them). So in today’s blog post, we’ll just be highlighting three inspiring women in impact investing.

1. Amy Domini, Founder and Chair of Domini Impact Investments

Amy Domini

Amy Domini is a well-known leader in socially responsible investing. In the 1970s and ‘80s, she was a stockbroker in the Boston area. It was then she learned that many investors had strong views on what they would, and wouldn’t, invest in. That led her to understand the power of mission-driven investing, and soon she began pushing for divestment from South Africa, which was under apartheid rule. In 1990, she created one of the first social indexes of U.S. companies based on ESG criteria; later that decade, she started her company based on similar sustainable principles.

What are Amy’s hopes for the future of impact investing? “Companies need to report on the impact their operations are having on people and the planet in a manner that is quantifiable and relevant,” she told InvestmentNews. “With this information, investors will make better, more informed choices.”

 

2. Julie Gorte, Senior Vice President for Sustainable Investing at Impax Asset Management

Julie Gorte

Julie Gorte leads Impax Asset Management’s Sustainability Research team in conducting environmental, social, and governance (ESG) security analysis on prospective and current investments as well as the firm’s shareholder and public policy advocacy initiatives. According to Julie’s LinkedIn bio, her team was instrumental in the development and launch of the Pax Global Women’s Leadership Index, a custom index calculated by MSCI, in 2014.

Julie serves on the boards of the Endangered Species Coalition, E4theFuture, Clean Production Action, Great Bay Stewards, and is the board chair of the Sustainable Investments Institute. She also serves on the Investment Committee of the United Nations Environment Programme Finance Initiative.

 

3. Sallie Krawcheck, CEO and Co-Founder of Ellevest and Owner and Chair of Ellevate Network

Sallie Krawcheck

Sallie Krawcheck’s professional mission is to help women reach their financial and professional goals. She hopes this will enable them to live better lives and unleash a positive ripple effect for their families, communities, and economy.

Sallie is the CEO and co-founder of Ellevest, a digital, mission-driven investment platform for women. Ellevest is a champion of impact investing; ESG funds are a big part of their Ellevest Impact Portfolios because they believe that by investing in companies who follow good ESG practices — and excluding those who don’t — their dollars can help advance women.

Impact Investing with The Humphreys Group

At The Humphreys Group, we’re passionate about helping investors align their money with their values. If you’re interested in getting started with impact investing, reach out to our team today.

Recommended Reads on Impact Investing

Published in: Resources |

You’ve probably been hearing more about impact investing lately. According to Morningstar, the first half of 2020 saw a record $20.9 billion flow into sustainable funds. As we’ve written on the blog before, the global COVID-19 crisis, social unrest, and economic inequality have highlighted how connected we all are and how deeply we need more efficient systems. If you’re interested in learning more about impact investing, these three reads are a great place to start:

1. Real Impact: The New Economics of Social Change by Morgan Simon

Impact investing has been a hot topic within investment circles for a long time, and for good reason — when like-minded investors pool their resources with a single mission in mind, they have the potential to be a powerful force for good. But after nearly 20 years of leading and managing endowments and foundations, Morgan Simon has noticed that impact investing often comes up short. More often than not, she says, well-intentioned investors choose to address the symptom (for example, temporarily improving the circumstances of underserved communities) without treating the disease (for example, addressing the power imbalances in our economy).

In Real Impact, Simon breaks down why impact investing often fails to maximize its potential, proposes a new model and set of principles that might broaden its influence, and shares stories that bring these principles to life. She passionately argues that investing can be used to foster real, transformative change, and challenges the reader to help build a better economy and healthier world.

2. The Power of Impact Investing: Putting Markets to Work for Profit and Global Good by Judith Rodin and Margaret Brandenburg

Doing good in the world of and getting a return on your financial investment does not have to be an either/or proposition. Enter impact investing — an approach to investing that combines the desire for a financial return with the desire to produce social and environmental benefits. In their book The Power of Impact Investing, Judith Rodin and Margot Brandenburg map out what it means to be an impact investor, the range of investment opportunities that are available, and perhaps most importantly a chapter entitled “Getting Started” to help you, the investor, get launched. They bring a wealth of expertise to the topic and their passion for impact investing and the positive change it can produce is apparent throughout the book.

Their book is a call to action for those who are curious about this form of investing. As they point out, it may not be the right answer for everybody, but it is a way to harness the power of capital markets for social good. Not designed to replace traditional philanthropy or grant making, impact investing provides an additional tool in the battle to improve lives and solve some of the world’s biggest problems. Impact investing is a means of using capital to drive financial value and social and environmental impact simultaneously. In other words, you can have your cake and eat it, too!

3. Winners Take All: The Elite Charade of Changing the World by Anand Giridharadas

This New York Times bestseller looks at how the global elite’s efforts to “change the world” actually preserve the status quo and obscure their role in causing the problems they later seek to solve. It’s an essential and fascinating read for understanding some of the egregious abuses of power that dominate today’s news. Anand Giridharadas takes us into the inner sanctums of a new gilded age, where the rich and powerful fight for equality and justice any way they can — except ways that threaten the social order and their position atop it. They rebrand themselves as saviors of the poor; they lavishly reward “thought leaders” who redefine “change” in ways that preserve the status quo; and they constantly seek to do more good, but never less harm.

Giridharadas asks hard questions: Why, for example, should our gravest problems be solved by the unelected upper crust instead of the public institutions it erodes by lobbying and dodging taxes? This book points us toward an answer: Rather than rely on scraps from the winners, we must take on the grueling democratic work of building more robust, egalitarian institutions and truly changing the world — a call to action for elites and everyday citizens alike. Once you get a taste of Giridharadas’ message and style, you may want to follow him on Twitter (@AnandWrites) and subscribe to his newsletter The.Ink (https://the.ink/). You can rely on him for a fresh, informed, original and intelligent take on today’s current events.

Impact Investing with The Humphreys Group

Let us know if you read one of these three books on impact investing! If you want to learn more about impact investing, reach out to our team today.

6 Investing Tips for Gen Z and Millennials

Published in: Resources |

Your 20s is a great time to get into the stock market. Whether it’s in a taxable account or retirement account, investing early gives your money lots of time to grow and lets compound interest work its magic.

Why Start Now?

To understand the consequences of waiting to invest, consider this example. Let’s say you start contributing $100/month at age 25 to your retirement, and you do so for 40 years. Assuming a 7% return, you’ll end up with $260,000 in your retirement account at age 65. If you wait until you’re 35 to begin that contribution, all else being equal, you’ll have only $120,000 in your retirement account at the same retirement age. That ten-year delay would cost you over half of your retirement savings! (Check out the SEC compound interest calculator to play with the numbers for yourself.)

Tips for Investing in Your 20s

Here are our tips and strategies for investing in your 20s:

  • Invest in mutual funds, not individual stocks. The days of old-fashioned stock-picking are long gone — mutual funds offer both diversification and professional expertise, two vital components of investing.
  • Diversify. Buy funds that invest in US equities, international equities, large cap, small cap, fixed income, real estate, etc. to give yourself exposure to all areas of the market and minimize risk.
  • That said, don’t overthink it or worry about picking the “wrong” fund. How soon you start investing is more important than what you invest in.
  • Set up automatic contributions. By investing a consistent amount on a regular basis, you’ll sometimes buy when the market is low, and sometimes buy when it’s high. This strategy will ultimately allow you to buy shares at a lower average cost over time and hopefully help you avoid any temptation to “time the market.”
  • If you’re wondering what account to open first, look to your employer and see if they offer a retirement plan like a 401k or 403b. If they offer an employer match, contribute at least as much as is required to take full advantage of it. If you don’t, you’re essentially leaving free money on the table!
  • If your employer doesn’t offer a retirement plan, consider an IRA or Roth IRA. Roth IRAs are generally advantageous for young people but do keep in mind that there are income limitations involved.

Investing Mistakes to Avoid

Here are investing mistakes that 20-somethings should avoid:

  • Monitoring your investments too closely. Instead, you should set it and (kind of) forget it. Check your account quarterly to give yourself a sense of how much you’ve saved, but don’t check it regularly, especially during market swings. That will just lead to unnecessary anxiety and might prompt you to feel like you have to sell your investments when you should simply be riding out volatility in the market.
  • (Literally) buying into the latest trend. Don’t be seduced by financial sensationalism. The sooner we learn that smart financial decisions are usually not very exciting, the better!

The Advantages of Investing in Your 20s

When you’re in your 20s, your needs are likely much more straightforward. Investing for yourself now gives you more space and financial wherewithal to attend to your other goals when you get older.

People in their 30s and 40s have a lot of competing financial priorities: childcare, saving for their children’s college, saving for their own retirement, maybe beginning to help elderly parents… the list goes on. It’s a lot to juggle and can be overwhelming to decide what to prioritize.

Financial Planning with The Humphreys Group

Interested in learning more about investing and how you can get started early? Reach out to our team today.