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Investing Ethically

This article was written by in Investing. 7 comments.

Last year we wrote an article about Ethical Consumerism, the practice of spending your money on businesses who support your ideas of a healthy community and environment.

In addition to where you spend your money, you can also put a lot of thought into which investment vehicles agree with your personal ethics. This is something weighing on my mind as I start from scratch learning about investing as a whole (see my previous article on the subject: What Do I Know About Investing?). There are a few different strategies, as I see it so far:

Invest in things you think will succeed, regardless of your own ethics

One of my co-workers is the sort of person who eats well, exercises all the time and generally treats his body as a temple. When I asked him if he ever does any investing, he quickly answered, “Only in the Vice Fund”. The Vice Fund invests in alcohol, gambling, tobacco and aerospace and defense industries. You could think of it as the “World is Going to Hell Fund”. The way I see it, investing in something with that kind of mission statement is akin to hoping other people keep destroying themselves.

For a guy who treats his own body as a temple, this seems like a weird contradiction, but as he tells it, the fund has been very lucrative for him, excluding 2008.

A similar example might be a vegetarian with a lot of stock in Burger King. Doesn’t make a whole lot of sense, except it could be quite profitable.

Invest in things you wish would succeed

For example, I wish that solar, wind and geothermal energy would succeed, and if I believed my Fifth Grade teachers, by 2009 those are the only sources of energy we should be using. I’m not particularly opposed to oil and coal because they’re dirty and they may be funding who-knows-what kind of overseas operations; I’m opposed to them primarily because they are finite resources. Eventually we will run out, and we may as well start weaning ourselves off of them now, because of the other environmental and political reasons. But do I think all humans will stop using oil and coal by the time I should be retiring, in about 30 years? I’m not sure.

Hedge your bets

Well, there’s one method of hedging your bets, which is to invest both in the things you think are successful-but-harmful, and in the things you think would benefit the world if only people saw things the way you do. But this doesn’t seem like a strong, long-term strategy to me. One of them will eventually fail. Thankfully, there’s another nuance:

The oil giant Shell is following BP and releasing a bunch of commercials highlighting how they’re committed to refining new ways to power things. This reminded me of another transition that shook up some companies: when photos moved from film to digital.

Nikon, for example, cruised along for decades making some very good (and some very cheap) film cameras. When computers became fast enough and connected enough, people started sharing their photos digitally and demand for digital cameras grew. Not willing to let a different company take their market share, Nikon became expert at making digital cameras as well.

Oddly, I don’t hear the names Kodak and Polaroid as often as I used to, though I know they’re still around.

Today we think of Exxon and Shell as “oil companies”, but they may very well position themselves as leaders in the geothermal energy space in the future. Here’s where my earlier advice about doing lots of research come back into play.

Further reading

Consumerism Commentary has written many, many articles about investing in the past. Flexo is a lot more knowledgeable than I am, so far, but I hope to catch up soon.

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Back From California and Blog Roundup

This article was written by in Link Sharing. Add a comment.

I spent this past week visiting family in California. My girlfriend (A.) and I joined my family’s west coast contingent for a few days in San Diego, staying at the Hyatt Regency Mission Bay. Among other things, A. and I visited the San Diego Zoo, where I exercised my new Canon Digital Rebel XTi camera with a new Canon EF-S 17-85mm IS USM SLR lens which I picked up prior to leaving for vacation. I took about 500 pictures in the zoo alone, but I selected about 80 pictures for inclusion in my online photograph gallery. The photo I’ve included below is of a guanaco.

Thanks to Sasha and Smithee who entertained Consumerism Commentary readers while I was away. In addition to their excellent articles, such as Ethical Consumerism, an Introduction and Why I Have No Money, here are some articles from the members of the MoneyBlogNetwork:

Retirement Plan Rollover Chart. J.D. managed to dig out this handy chart from the IRS. It explains which rollovers are considered legitimate and the related requirements.

Debt Reduction Guide: Getting Started. No Credit Needed is working on a multi-part guide to eliminating debt, as the article title implies.

Congratulations! You Can Now Keep Your Money. Mighty Bargain Hunter points out that April 23 was “tax freedom day.” The premise behind this “holiday” is that from January 1 until this day, all the money you earn could be sent to the government in the form of taxes, and your liability would be paid in full for the entire year. Of course, this is just an estimate, an assumption based on averages, as everyone’s tax situation is different.

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Tax-Deductible Weddings, Part 1

This article was written by in Family and Life. 6 comments.

We’re entering the peak wedding season, it seems.

Ever since I got engaged earlier this year, I’ve been bombarded by sales pitches from every angle. They’re certainly tricky. They come disguised in several colors of tulle, bearing elegantly inscribed messages to remind me that I only live once and want my special day to be perfect.

Perfect, of course, translates to premium, as in every upgrade on the already mile-high price list. If you’re a frugal sort, it’s almost enough to make you fall out of love with the idea completely.

For my fiance and myself, our special day will only be perfect if we can have all our family and friends join us without incurring additional debt. The perfect wedding should be the start of our perfect life together, where we can actually afford our bills and monthly expenses. So I’ve been searching relentlessly for information to plan an affordable event to remember which still reflects our beliefs and way of life as ethical consumers.

Luckily, my search has revealed that there’s a great way to save on money while still supporting causes we believe in: finding tax-deductible wedding expenses.

The Venue
I’ve learned that the reception is typically the most costly part of the wedding, comprising about half of the total cost, according to theknot.com. This estimate includes the cost of the venue, catering food and service, alcohol and beverages, wedding cake and parking.

If you choose to have your reception at a site owned by an approved nonprofit organization, your site fees may be tax-deductible, as the cost can be considered a donation to support the upkeep of the facility. This applies to a number of historic landmarks and homes, museums, even nature centers.

I’ll share a few local spots I discovered:

Prallsville Mill, a rustic, historic mill in Stockton, NJ, holds up to 150 guests.
Tax-Deductible Facility Fee: $1,850

Honey Hollow Barn, the nature center for the Bucks County Audubon Society, is a lovely stone barn with exposed beams in desirable New Hope, PA and holds up to 75 guests.
Tax-Deductible Facility Fee: $2,500 for a Saturday wedding

Things to Know
You must obtain a statement from the nonprofit organization which states the amount of your contribution. Goods and services recieved must be deducted from this, if applicable.

For church rentals, although only your accountant can tell you about any other applicable rentals, any amount beyond what is considered to be the fair market value of the rental is tax-deductible. You may be able to deduct gifts paid to clergy as well.

In order to claim these deductions, you will need to itemize them using Schedule A.

Know of any more great, tax-deductible spots for a wedding reception? Post them in the comments!

My next entry will feature more tax-deductible wedding savings ideas.

Image Credit: babasteve

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