Do Good With Your Wealth—Here's How!

As you approach retirement, you may find yourself reflecting on the legacy you'll leave behind. In addition to accumulating wealth, you might have a desire to leave a positive mark on the world. Sustainable investing offers a path to do both.

The Great Wealth Transfer: A Unique Opportunity

Over the next few decades, experts predict¹ we’ll witness an unprecedented shift of wealth from older generations to younger ones. This “Great Wealth Transfer” is anticipated to move tens of trillions of dollars to younger generations in the U.S. alone.

As today’s digital society provides unprecedented access to information, younger generations are more attuned to social and environmental issues and how their financial decisions impact them. As wealth passes to these socially and environmentally conscious generations, sustainable investing is becoming a key strategy for driving positive change.

However, it’s not only younger generations driving this change. As you plan the transfer of your wealth, consider joining this positive movement by choosing sustainable investing as an alternative to traditional charitable giving.

What Is Sustainable Investing?

Sustainable investing is an investment approach that considers environmental, social and governance (ESG) factors.

• Environmental criteria refer to a company's environmental footprint, including policies on carbon emissions, renewable energy use, and waste management.
• Social criteria refer to relationships with employees, suppliers, customers, and communities, covering workplace safety, labor standards, and product integrity.
• Governance criteria refer to a company's leadership practices, including board diversity, executive compensation, and corporate ethics.

By considering these factors alongside traditional financial metrics, sustainable investors aim to generate financial returns while also creating a positive impact for causes they care about.

Sustainable Investing Strategies

There are several approaches to sustainable investments. Some common strategies include:

1. Exclusionary screening: Avoiding investments in companies or industries that are involved in activities deemed unethical.
2. Impact investing: Investing in companies, organizations, or funds with the intention of driving positive social or environmental impacts.
3. Shareholder advocacy: Engaging with companies through shareholder resolutions, proxy voting, and direct dialogue to encourage improved ESG practices.
4. Community investing: Directing capital towards community development financial institutions or local projects that provide financial services to underserved communities.

There is no single “correct” strategy; your values, risk tolerance, and financial goals should all be considered. If this strategy is of interest to you, we can work together to determine the appropriate approach for your unique situation.

Why Sustainable Investing Matters

Sustainable investing has the potential to promote long-term positive impacts on important issues. By supporting businesses with environmentally friendly practices and high social and ethical standards, you can contribute to causes you care about and help build a better future.

Moreover, sustainable investing allows you to align your financial goals with your values. This alignment of purpose and profit can bring a sense of fulfillment, knowing that your investment choices are contributing to positive change for generations to come.

Are you ready to explore how sustainable investing can help shape your legacy? Contact my office today to discuss your options and start building a portfolio that reflects your values.

^{1) Great Wealth Transfer: Baby Boomers Set to Pass Down Trillions," Yahoo Finance, retrieved June 18, 2024, from https://finance.yahoo.com/news/great-wealth-transfer-baby-boomers-110047810.html.}