Focus Your Buying Power
The path to financial well-being begins when we align money behaviors with core beliefs. What's the best way to bring them together? You can express your values in the way you earn money; the goals for which you save; the things you buy; the investments you make; and your charitable giving. Following are three ways to help align your money and values.
American women represent the largest economic force in the world -- spending nearly $5 trillion a year, by one estimate. That's an incredibly powerful force for change. Check out www.responsibleshopper.org, a site that offers information on the ethics of the brands you buy and the stores you frequent. You can find out if they are polluting oceans, violating human rights or engaging in other bad practices. The report also looks at a company's positive activities, whether it's humanitarian giving or a commitment to improving the environment. Meanwhile, at www.sweatshops.org, you can find out how to avoid buying products made in sweatshops. Both sites are sponsored by Co-op America, a non-profit group whose mission is to harness consumer strength to create a socially just and environmentally sustainable society. It also sponsors www.greenpages.org, a directory of companies that have agreed to be screened by Co-op America for good practices.
Invest in A Sustainable Future
Put your money where your values are using a category of mutual funds called socially responsible investing (SRI). Quick definition: In a mutual fund, many different investors pool their money and entrust it to a professional fund manager; he or she puts the money into a basket of different investments, aiming for a strong return on the money. SRI funds also look for solid returns, but they weigh companies' social, environmental, and ethical practices when choosing which stocks to purchase for the fund. For example, some funds won't invest in military contractors, casinos, or companies that make guns, alcohol, or tobacco products. Others analyze how companies treat the environment, their employees, and their communities. Among the leaders in category are Calvert Funds, Domini Social Investments, and Citizens Funds, although mutual fund giants such as Vanguard also offer SRI funds. For a full listing of SRI fund companies, see www.socialinvest.org or www.socialfunds.com.
Curious to know if a mutual fund you currently own lives up to your values? At www.calvert.com, you can run a fund you own through a socially responsible screen to see if it contains any investments that violate your values. Click on "Socially Responsible Investing," and then "Know What You Own." Then choose a personal area of interest to screen-such as "environment." Calvert provides a report listing the stocks owned by your fund that failed the screen. (You can click on "issue brief" to see exactly what environmental or other concerns the screen considers.)
Make the Most of Your Giving
Online alternative gift catalogs are a great avenue to share the wealth, and help you find a more meaningful gift for the man or woman who has everything. In the name of the recipient, you can give the gift of seeds and tools to grow a garden to feed orphans in Africa, or shelter for a homeless family for the night. Check out Alternative Gifts International www.altgifts.org or Heifer International http://catalog.heifer.orgheifer. For "gift basket" charitable ideas, check out www.justgive.org, or www.networkforgood.org.
Before you give to any charity, make sure it's legitimate, and the money is going where it is truly needed. Look at the financials of a charity you're considering: No more than 10 percent of the budget should go to fund-raising and publicity, and no more than 35 percent to administrative costs. Check out www.guidestar.com, and www.give.org. These online databases profile hundreds of charities, link to their IRS filings, and offer some guidelines for choosing an organization.