7 Investments That Make You Feel Good While You Make Money

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While investing might be a great way to build personal wealth, buying certain stocks benefits the common good. As an investor, you have the power to support companies and causes that are near and dear to your heart, while also padding your wallet. 

Letting your values lead your investments is commonly known as socially responsible investing. Practitioners put their money where their hearts are, screening out organizations that produce products they deem harmful or are headquartered in regions known for human rights violations.

For instance, before apartheid ended, some socially conscious investors refused to contribute to companies based or operating in South Africa. However, consider the kinds of ventures worthy of your dollars and sympathies.

GOBankingRates talked to some experts about how socially responsible investors can positively contribute to the world while enjoying healthier returns.

Agricultural Co-Opts 

The local farmer might be a relative term, but with the seeds of your investment, you can help small farmers worldwide build their wealth and legacy. As the founder of Agrisapien Traders, a specialty coffee importer, Paulo Peres is highly knowledgeable about the companies and organizations that support family farmers, agricultural communities, and environmental stewardship. 

“For example, we partner with cooperatives like Cooxupé in Brazil. They represent over 6,000 family farms and are innovators in sustainable practices,” he said. 

He added that companies sourcing from Cooxupé by paying fair prices for their beans enable the cooperative to share higher profits with the farmers, which can fund valuable community programs. 

“This kind of social impact is appealing to many socially conscious investors,” Peres said.

Eco-conscious Companies 

Peres added that investors passionate about preservation also support publicly traded companies that focus on protecting the environment. Among these companies, he named solar energy provider Sunrun and the plant-based food manufacturer Beyond Meat. 

“These companies are working to solve real problems,” he said. “For investors who care about more than just profits, stocks like these can be very appealing and help align your money with your values.”

If you’re searching out some socially conscious companies on your own, Peres suggested that you look for companies that are transparent about their supply chain, sustainability initiatives, and community impact. 

He advised that you seek B Corporations, organizations with specific interests in fair trade, renewable energy or even social justice issues you care about. 

“While risk is always part of investing, you can feel good knowing your money supports meaningful change,” he said. For many investors today, that kind of impact matters.”

Healthcare and Biotech 

By supporting companies in the healthcare and biotech sectors, you can help support the next life-changing, or lifesaving, discovery in medicine. According to Dennis Shirshikov, finance professor at the City University of New York and head of growth at Gosummer.com, that is essentially what investors in Johnson & Johnson and Moderna did as the COVID-19 vaccines were released. 

“Companies that focus on innovative healthcare solutions and accessibility can provide both financial returns and social benefits,” he said. “Moderna (MRNA) and Johnson & Johnson (JNJ) have made significant contributions to public health, particularly during the COVID-19 pandemic, by developing vaccines and treatments that save lives.”

Sustainable Consumer Goods

Shirshikov added that one of the biggest emerging trends among socially conscious consumers and investors is supporting companies that create sustainable and ethically sourced products. While the outdoor clothing and gear company Patagonia is not publicly traded, he said it sets a strong example in this category. 

However, when it comes to publicly traded companies, Shirshikov recommends Unilever (UL) and Procter & Gamble (PG), in part because of their “substantial commitments to sustainability and ethical sourcing.”

Green Bonds 

If you’re looking to get a little creative with your investing and spread your funds across different projects to promote environmental sustainability, you might consider green bonds, which Shirshikov described as debt securities that are issued to finance environmentally friendly projects. 

“Companies and governments issue these bonds to fund projects like renewable energy installations, energy efficiency upgrades, and sustainable agriculture,” he added.

Impact Investing Funds

Should you be concerned about supporting investments that generate demonstrable social and environmental impacts, along with financial returns, Shirshikov suggested that you investigate impact investing funds. 

“Funds like the Global X Conscious Companies ETF (KRMA) focus on companies with strong ESG (Environmental, Social, and Governance) practices,” he said. 

Investing in Your Local Communities 

What could be more satisfying than seeing first-hand how your investment has directly impacted the lives of people in your community?

If this sounds like something that could inspire your investments, Shirshikov advised looking into Community Development Financial Institutions (CDFIs), which offer “opportunities to invest in underserved communities, promoting economic development and financial inclusion.”

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