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Intentional Investing: How to Invest Based on Personal Values

Intentional investing has been gaining popularity among investors who want to ensure their investment portfolios align with their values.

While most people seek investing as a means to simply make money, there are others who seek to invest with intentionality.

What is Intentional Investing?

Intentional investing is a comprehensive strategy tailored not just to meet financial goals like retirement, college tuition, or buying a home but also to reflect a deeper, value-driven mindset. This approach differs significantly from traditional investing, which focuses primarily on financial returns by emphasizing the importance of the means as well as the ends in investment decisions.

Key Components of Intentional Investing

At its core, intentional investing is about understanding and integrating one’s financial goals with personal values and ethical considerations. It’s a methodical approach that requires investors to be actively engaged with where, why, and how their money is being invested.

1. Identifying the Purpose Behind Your Investments

Why are you investing?

Before investing, it’s crucial to clarify why you are investing. What are your financial goals? Are you aiming to build wealth, save for retirement, or fund an education? Beyond the financial aspect, what impact do you hope to make through your investments? These guiding questions help steer all subsequent investment decisions, ensuring they are purposeful and aligned with your life’s goals.

2. Choosing the Right Industries

What industries are you investing in?

If you listen to mainstream advice, you might believe that the point of it all is to “pick the winners” or beat the market. Intentional investing involves selecting sectors that not only promise returns but also support your personal and ethical values. For example, if environmental sustainability is important to you, you might invest in renewable energy rather than the fossil fuel industry.

3. Selecting Companies and Funds

Who are you investing with?

Now that you know which industries, the third part of this equation is knowing exactly which companies to choose. This step is about ensuring that a company’s mission, practices, and ethics resonate with your personal values. It involves deep research and sometimes the help of platforms or advisors who specialize in thematic investments that align with specific ethical guidelines.

4. Deciding How to Invest

How are you investing?

Finally, intentional investing includes which platforms and financial advisors to work with. You’ll need to use online brokerages that offer thematic investments. The choice of platforms and advisors is also a part of intentional investing. Investors should seek out brokerages and financial planners who offer products and advice that align with values-based investing strategies. This could include specific funds or stocks that are geared towards positive social and environmental outcomes.

Differentiating Similar Concepts

  • Impact Investing: This is a form of socially responsible investing focused on maximizing financial returns while also making a positive social or environmental impact.
  • Socially Responsible Investing (SRI): SRI integrates personal values into investment decisions, considering factors like corporate governance, human rights, and environmental impact, alongside traditional financial analysis.

The Core Principles of Intentional Investing

1. Goal Alignment

The first step in intentional investing is identifying your long-term financial goals, whether it’s saving for retirement, funding an education, or building generational wealth. Investments are then chosen based on how well they align with these objectives, considering factors like return expectations, risk level, and time horizon.

2. Ethical Consideration

Intentional investors often prioritize the ethical implications of their investments. This can include avoiding companies or industries that contradict personal values, such as those involved in fossil fuels or tobacco, and favoring those that adhere to social, environmental, and governance (ESG) criteria.

3. Educated Decisions

A hallmark of intentional investing is the commitment to understanding the underlying assets in one’s portfolio. This means researching beyond the basic metrics of stocks or funds to include the business practices, market positions, and growth potential of the entities in which one invests.

4. Diversification

While it’s important to invest with purpose, intentional investing also involves diversification to manage risk. This means spreading investments across various asset classes, industries, and geographies to mitigate the impact of any single investment’s poor performance.


How to Begin Intentional Investing

Step 1: Articulate Your Values and Goals

Begin by writing down your core values and what you aim to achieve through your investments. This foundational step is essential for guiding your investment strategy and decisions.

Step 2: Develop a Budget

Creating a budget is fundamental for anyone looking to invest intentionally. It helps you plan your finances, set and achieve goals, and maintain focus on your financial future.

Step 3: Choose an Online Brokerage

To invest intentionally in stocks, bonds, mutual funds, ETFs, and other securities, you’ll need to open an account with an online brokerage that offers a wide range of investment options and supports value-based investment choices.

Step 4: Conduct Thorough Research

Use tools and resources to thoroughly research potential investments to ensure they meet your ethical standards and financial expectations. This might mean diving into annual reports, sustainability metrics, and third-party ESG ratings.

Step 5: Seek Professional Advice

Consider consulting with a financial advisor who specializes in ethical or sustainable investing. They can provide valuable insights and help tailor a portfolio that matches your specific needs.

Step 6: Monitor and Adapt

Investing is not a set-it-and-forget-it activity. Regular monitoring and willingness to adapt your strategies are crucial as markets evolve and personal circumstances change.

Intentional investing has been gaining popularity among investors who want to ensure their investment portfolios align with their values. Fortunately, many online platforms now offer tools and resources for people interested in intentional investing. And access to a financial advisor offering financial planning with an intentional approach to investing is becoming more widely available.

Jason Vitug

Jason Vitug is a bestselling author, entrepreneur, and founder of phroogal.com and thesmilelifestyle.com. His purpose to help others live their best lives through experiential and purposeful living. Jason is also a certified yoga teacher and breathwork specialist and has traveled to over 40 countries.

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