Faith-based investing is just like any other type of investment strategy in that the investor is trying to find a place to invest their money where they think a positive return is possible. Where it does differ from traditional and secular investment plans however, is how the individual investor chooses who they work with and the types of investments they will consider. Generally, Individuals who care about faith-based investing will make the decision to work with advisors, managers and companies that align with their particular faith or values. That’s why faith-based investing is also commonly called values-based investing. Faith and values are oftentimes closely tied together.
Faith-based investing isn’t about buying shares in your local church. As most people know, nonprofit organizations, churches and other places of worship don’t issue shares to the public on the open market. But that doesn’t mean you can’t mix your faith with your investment strategies and goals. Now having said that, what exactly is faith-based investing?
The Basics of Faith-Based Investing
Like we mentioned earlier, while churches or other places of worship do not sell securities directly to investors, the principles followed by religious groups are well known, and are generally easy to find. The basic premise behind faith-based investing isn’t any different than any other strategy, but rather than chase the latest hot picks on wall street, faith-based investors will make decisions that align with their own faith, principles and values.
A Christian investor for example, may enlist the professional assistance of an investment company, like Devoted Capital, that runs their organization based on their Christian beliefs.
Some of the most common issues with those interested in faith-based Investing include:
- Pornography/Adult Entertainment
- Birth Control
- Stem-cell research
- Same sex marriage
- Embryonic cloning
Does Faith-Based Investing Work?
Faith-based investing is just as successful (or unsuccessful) as any other investment style. This means there’s no guarantee that you generate better returns just because your investments align with your personal values and beliefs.
Before you decide if faith-based investing is right for you and your family, do your own research. Make sure the investments that align with your faith, also fit your financial profile, economic situation, and goals both short- and long-term.
Faith-based investing faces the very same challenges that every other philosophy does and they are subject to the same amount of risk. One key component to those that engage in faith-based investing, is knowing where their investment dollars are being spent. This can provide a tremendous amount of peace which is extremely valuable.
Our team at Devoted Capital can help answer any questions you have about Faith-Based Investing or investing in general so please let us know how we can help.