Women have been left out of the financial conversation for far too long, and it is time for our voices to be heard and our needs to be addressed. Collectively, our money has the power to change the economy and create a world that better addresses our needs and priorities.
You picked up this book because you want to know more about how to invest your money in a way that resonates with your values. Putting your money to work this way is called values-aligned investing. Just because this is not the way that investing has been traditionally practiced does not mean it cannot be the way you invest. It is time for women to own their assets and to become confident investors while using their money to create a world that reflects their values. This book will show you how to invest with confidence and invest your values—without giving up your financial returns.
You may be single, partnered, or married. You may be a parent, childless, or an empty nester. You may be well informed about money, or you may be just a beginner. You may have a financial advisor or be in the market for one. Regardless of your personal situation, this book is intended to help you feel empowered around your money and help you think—and act—in new ways around your investments and your ability to use them as a force for good.
We all want to feel good about our financial decisions, and increasingly we want to know that our money supports the things we care about. Yet, many of us are unsure. Perhaps you don't think you have enough money to invest. Maybe your usual reaction to conversations about money is throwing up your hands in despair because you simply don't know what to do or you don't have the time to figure it out. You might find the thought of taking responsibility for your investing overwhelming and fear inducing. Maybe you are ashamed, because you think you should know more than you do, or you incorrectly believe that other people are just smarter than you are about money. Or maybe you already take responsibility for your investing and just want to know more.
I'm here to tell you that you can learn to invest wisely, just like you have learned everything else in your life. If you lack confidence, don't worry. There are lots of other women who are in the same boat as you. Even women who are worth tens of millions of dollars, women with MBAs, and women who work in the financial industry can feel uncomfortable when it comes to making investment decisions about their own money.
These feelings are not surprising, given our history as women. We are often not trained in finance and investing, but that doesn't mean that we are incapable. When we do take control of our money, we outperform men by as much as 0.40% to 1.8%, according to recent studies conducted at the University of Warwick and Fidelity Investments.1 2 While this may appear to be a minor difference, it can have a significant impact over time. The old messages about our abilities with math, numbers, and investing are fallacies. Not only can we do well when we invest, we can do better!
If you've picked up this book, chances are you're someone who lives her values. You care about your family, friends, and communities. You want to see the world be a better place for future generations. You care about the planet—the quality of the air, the water, and all living things. You are interested in sustainability and justice. You already do a lot to live your values, through the choices you make and the way you spend your money. You're beginning to realize that how you invest your money, and what you support with your assets, matters. And now you are ready to know more.
This book will help you build your confidence about investing and show you how to invest in ways that support the things you care about without giving up financial return. I am a testament to this practice. I have been working to align all of my money with my values for more than 10 years, but I am not a professional financial advisor. For that reason, I reached out to the incredible network of women that I have developed over my professional career. More than 150 amazing women (and a few men) contributed to this book. Some wrote a few pages, others a chapter, and still others served as reviewers, commenters, and thought partners. I could not have created this book without them, and I owe them all an enormous debt of gratitude.
This book grew out of my own investment journey. I wrote it to make investment know-how more transparent and easily understandable. I didn't want learning how to invest according to your values to be the steep uphill climb for you that it was for me.
In 1995, after a four-month solo backpacking trip through sub-Saharan Africa, I stepped out of a successful career in the computer industry to redirect my work toward addressing issues of global poverty. Not only did I take a significant pay cut when I embarked on this new venture, I also left the high-tech industry just as the Internet came on the scene. Some of my former colleagues thought I was crazy. But I was passionate about making the world a better place, and I was willing to bet my future on the potential that I saw. Over 20 years later, I couldn't be happier with the outcome of that choice.
Among other things, my new career gave me entree to many of the early discussions about transforming philanthropy and what became known as impact investing. One of the premiere conferences related to these conversations was the Global Philanthropy Forum. Around 2009, I stood up at their annual meeting and announced to the audience of foundation CEOs, ultra-high-net-worth individuals, and large institutional investors that I wanted to invest my own assets in alignment with my values. I was greeted with mute surprise. The impact investing community at that time was not a place for those without very deep pockets, which I did not have. But I was unfazed. After all, I had made a major career pivot to align my life's work with my values. Why should my money be supporting the social injustices I was striving to change?
Since then, I have been working to align all of my assets—from my checking and savings accounts to stocks to real estate—with my values. I want all of my financial resources to support the things I care about—the things I would like to see created, elevated, and empowered. Over the years, I have worked with three different financial advisors, all of whom assured me they would help me reach my goals. Unfortunately, they didn't. The reasons are as varied as the advisors themselves, but after a decade of depending on them, I found that less than a third of my assets were helping to create the world I wanted to see. The majority of my money was still in the service of banks, financial institutions, and companies I did not want to support. In some cases, my investments were upholding industries and companies I actually abhor. Now I'm changing that, and I'm finding it does not have to be that hard.
How did this happen? Why wasn't I more successful sooner? The answer to those questions is partly an issue of timing. When I started on this path 10 years ago, there were not many socially responsible investment options for individuals, particularly if you did not have extraordinarily high net worth. Fortunately, things are changing. As you will discover in this book, socially responsible investing is becoming mainstream, and there are investment options across all asset classes. With the passage of the 2012 JOBS Act, investment opportunities that were previously available only to people with $1 million or more in net worth are now available to anyone. There has been a sea change in terms of values-aligned investment opportunities over the past 10 to 15 years, and the level of innovation is accelerating.
In addition to the timing issue, I think I was less successful back then than I wanted to be because I was trapped between wanting to trust my financial advisors and wanting to wait and know more before I invested. I did not feel comfortable just doing as I was told. I wanted more knowledge, but my advisors were not providing me with the depth of information that I needed to feel secure and confident. It seemed the only way to learn was to figure the details out myself. Crazy, right? So I asked my advisors to hold off making investments until I had the time to learn more. Other things got in the way, time passed, and my money sat in cash or other low-yielding assets, waiting for me to make a decision.
This pattern was extremely frustrating, and I found it difficult to find the time to get educated. The financial knowledge I craved was hard to locate. It was dispersed among a wide variety of sources, presented in a complex manner, and challenging to distill in a meaningful way. My advisors weren't that helpful, either. I once asked my advisor about the risk related to an investment they were recommending and was told there was no risk. I knew that could not be true, but when I asked for more detail, I was told the risk was complicated to explain and I should just trust the advisor. I did not make that investment, because I didn't want to invest in something that I couldn't understand.
Although it was often slow going, over the years my knowledge grew. As a result of my self-directed education, I interacted with many leading thinkers in social investing, some of whom are contributors to this book. They helped me learn. And in late 2017, when I retired from my career in international development, I reclaimed control over most of my assets. Since then, I have been moving toward my values-aligned goals at an accelerated pace.
I've learned that investing for positive impact does not have to be difficult. You shouldn't have to tease out information about values-aligned investment options from the knowledge banks of financial advisors or disparate online sources. Through direct experience, I know it is possible to invest with conscience as a guide and to achieve market-rate financial returns across most asset classes.
There is no silver bullet to achieving financial freedom. If you want to achieve financial fulfillment, you're going to have to do some work. You're going to need to learn things and practice what you've learned. This is a process. But it does not have to be onerous or fear inducing. Nor does it have to be mind-numbingly boring. It can actually be fun, particularly if you join other women and learn together. As you see your money growing and positively influencing the world, it can give you great joy as well.
The book is divided into three parts. You can read the book cover to cover, or you can jump to a section or chapter that most appeals to you. Each chapter has a stand-alone quality, enabling you to approach the book in the manner that seems most appropriate to your needs. You can pick it up, take some action, put it down, and then pick it up again when you are ready.
This book will introduce you to a new way of thinking about money. It will show you that you have a choice about how—and where—you invest your assets. Your investment choices can bring your money into alignment with your values. When you feel good about what your money is doing in the world, it makes the entire process of investing more fun and engaging.
Our companion website, activateyourmoney.net, has downloadable resources that build on the themes introduced in each chapter. Be sure to visit it when you find a topic of particular interest as you are reading. Here you will find worksheets, spreadsheets, and other tools to help you take actionable steps toward your investment goals.
While writing this book, the contributors and I took great care to include information that was current. Given the dynamic nature of finance and the investing world, some of the information in this book, such as interest rates, returns, and fees, was obtained at the time the book was written and is subject to change. Therefore, we encourage you to check the current rates and fees, in case anything has changed since this book was written.
We're excited to take this journey with you. By investing according to your values, you can literally change the world.
Let's get started.
In keeping with the collaborative nature of this work, the author is donating 100% of the net income from sales of Activate Your Money to organizations that are advancing women's economic empowerment and values-aligned investing.