DAVE RAMSEY

Dave Ramsey says: You can make impact on society through investments

Aug 3, 2021, 12:15 PM
(Pixabay Photo)...
(Pixabay Photo)
(Pixabay Photo)

Dear Dave,

A friend recently mentioned something called impact investing to me.

What exactly is this? How do impact investment funds perform, and what do you think about them?

— Carson

Dear Carson,

Impact investing generally aims to benefit society, while providing a profit for the investor, by investing in companies, funds and organizations that are aligned with causes, certain values or issues.

Think of it as a middle ground between traditional investing and charitable giving, where you can match your investing with your own particular beliefs. It really isn’t all that different from investing in traditional mutual funds, except for the goal of the funds.

Since their inception, impact investments have averaged returns of a little less than 6%. That’s well below the average return of the S&P 500. Impact investing can do some good, but the truth is it’s hard to measure exactly how much good it’s doing.

If you’re going to invest in impact investing funds, you need to make sure you understand exactly how your money is going to help the businesses you invest in, if they’re actually doing what they say they’re doing, and whether or not they’re really making a difference for the better.

As with all investments, it pays to do a lot of research and find an advisor with the heart of a teacher. And never invest in anything if you don’t completely understand how it works.

Remember, it’s your money that’s in the mix. Don’t feel like the odd man out if you’re the only one not joining in on an investment craze your friends are diving into.

Personally, I recommend investing in good, growth stock mutual funds and real estate paid for with cash.

And hey, if you want to make a difference in the world and still invest the old fashioned way, create room in your budget for charitable giving or saving with the goal of making donations to organizations and causes you care about.

I hope this helps, Carson!

—Dave

Dave Ramsey

(Pixabay Photo)...
Dave Ramsey

Dave Ramsey says: Debit card has same fraud protections as credit card

For anyone wondering, a debit card has the exact same protections against fraud that a credit card has.
4 days ago
(Pexels Photo)...
Kristina Ellis

How college students can earn cash over winter break

One thing that helps with paying for college (or covering those extra expenses along the way) is making the most of your holiday breaks.
6 days ago
(Unsplash Photo)...
Dave Ramsey

Dave Ramsey says: Sit down with mom, talk over loan payment situation

Mom has wrong idea about an old loan. Offer to be her biggest cheerleader and help her find a good financial coach, but under no circumstances take a loan she took out and put it under your name.
11 days ago
(Pexels Photo)...
Kristina Ellis

These tips will help you and your kids save money on college application costs

Qualified high schoolers can get a fee waiver that will let them apply to college free. This can seriously help cut back on college application expenses.
13 days ago
(Pexels Photo)...
Dave Ramsey

Dave Ramsey says: Pay off the debts in collection starting with smallest

There’s no upside to not paying what you owe. It’s an integrity issue, it’s a legal issue, and it’s a credit issue. Start knocking out the debt that’s in collections from smallest to largest.
18 days ago
(AP Photo/J Pat Carter, File)...
George Kamel

Make the most of marketing schemes Black Friday, Cyber Monday

We’ve all made our share of shopping mistakes on that fateful weekend after Thanksgiving, but not this year, my friends. Here are six money-saving tips that will make these sales work for you.
20 days ago

Sponsored Articles

...
Quantum Fiber

How high-speed fiber internet edges out cable for everyday use

In a world where technology drives so much of our daily lives, a lack of high-speed internet can be a major issue.
(Desert Institute for Spine Care photo)...
DESERT INSTITUTE FOR SPINE CARE

Why DISC is world renowned for back and neck pain treatments

Fifty percent of Americans and 90% of people at least 50 years old have some level of degenerative disc disease.
...
Quantum Fiber

Stream 4K and more with powerful, high-speed fiber internet

Picking which streaming services to subscribe to are difficult choices, and there is no room for internet that cannot handle increased demands.
Dave Ramsey says: You can make impact on society through investments