😇How can you invest ethically?😇
Hi friends,
Happy first day of Gemini season! To honor this special astrological time, let’s gossip about intelligent things.
So, this week I decided to tick something off the list I’ve been meaning to do since our annual pay rise came in: I upped my 401k contributions to 4% (my employer only matches until 3%).
A reminder: even if you think you don’t own any stocks at all, if you have any retirement funds, then you’re already in the stock market mate.
While poking around my 401k options (stay tuned for a future newsletter when I finally figure out how to roll my old 401k over to a Roth IRA, I’m so close), I noticed my employer now offers a “socially responsible fund.”
It’s an index fund which tracks the Calvert U.S. Large Cap Core Responsible Index, companies that are supposedly chosen because they are “good” companies, in a moral, ethical sense. Calvert is a responsible investing company that basically has a bunch of mutual funds through which it “seeks to generate favorable investment returns for clients by allocating capital consistent with environmental, social and governance best practices.”
Confusing term of the week: “mutual fund” — a professionally managed investment that has a bunch of shareholders pooling their money together to buy a variety of different stocks and bonds chosen by the portfolio manager.
But a look at the top 10 companies that make up 20% of the fund may make you question exactly who classifies what it is or isn’t “responsible investing.”
Microsoft Corp (MSFT)
Apple Inc (APPL)
Amazon.com Inc (AMZN)
Alphabet Inc (GOOGL)
Visa Inc (VISA)
JPMorgan Chase & Co (JPM)
Bank of America Corp (BOA)
Procter & Gamble Co (PG)
Pfizer Inc (PFE)
Verizon Communications Inc (VZ)
That’s right: big banks, drug companies, consumer brands that make chemicals and cleaners, tele-cos, tech giants with privacy and white supremacy issues and the world’s largest retailer are all “responsible investing.”
This is not to just crap on Calvert, but more to illustrate that what you consider responsible investing may not be the same as what the market does.
Earlier this month I appeared on Cardamom Pod — an excellent podcast hosted by Nadya Agrawal from Kajal Magazine and the darling Anushka Patil, who I work with at Buzzfeed News — about investing. If you don’t already, I suggest you subscribe to Cardamom Pod and listen to these smart women talk news and culture.
I was the very first ever white guest on the show, which was a huge honor, and I want to make it clear that I served as spokesperson for all white people by saying “like” approximately one million times.
But Anushka asked a question that I’ve been coming back to a lot lately: how do you invest in stocks in an ethical way?
She talked about how her partner (who I adore chatting stocks with) owned Amazon stock, which frustrates Anushka cause she thinks of it as “maybe the most evil company in the world right now.” “Wal-mart!” replied Nadya.
I noted that both Amazon and Wal-mart are regarded by many as ethical investments (I didn’t say Calvert cause I blanked on the name, but I had literally found Calvert that afternoon when typing “ethical investments” into Google, cause Anushka had warned me they wanted to speak about it lol).
As I said on Cardamom Pod, and yes I’m quoting myself here, you are the only one who gets to decide what responsible investing means to you:
It’s your own ethics. It’s what you personally are fine with, or not fine with… it really depends on what your own ethics are.
So just decide what you care about and therefore what you feel good about spending your money on!
And if the new abortion laws in Alabama just make you want to scream, forever, may I suggest throwing some cash to the National Network of Abortion Funds, which helps women who need money for an abortion.
In adjacent news, shout out to my hero sister who is due to go into labor in approximately two hours! My lil Gemini nephew is gonna emerge being so nosy and judgmental, Auntie Ambie adores him already.
Have a doubly good week,
Amber Jamieson
Better Have My Money is on Twitter @bhavemymoney, so please tweet nice things (aka the link to our sign up page) and tag us. Got a mate who also stopped watching GoT? Forward this onto them and tell them to subscribe. If you sign up to Acorns, use my sign up code to join and we both get $5.
As always, if you've got any questions about stocks, this is a shame free zone. Just reply and ask away.