lucky cola How Can I Green Up My Investments?
With the world on track for its hottest year in modern history, maybe you’ve decided to invest your money in a way that’s better for the planet.
Fossil fuel emissions are the largest driver of global warming, yet many of us endorse the biggest corporate offenders with a piece of our paycheck, at least indirectly, when saving and investing for retirement.
Once climate-conscious investors realize that, many are ready to banish big oil, gas and coal companies from their investment portfolios.
The good news: There’s a wide array of climate-focused options and many investment funds that exclude companies that profit from mining, drilling and refining. But it may still take a bit of time, patience and persistence to scrub your portfolio, and even then there may be some oily residue that’s hard to remove.
And better still: On the whole, green investors haven’t had to sacrifice performance. Nobody can predict the future, but for the last 10 years both investments with and without fossil fuel companies performed similarly, and the cleaner portfolios did marginally better: U.S. stock funds returned 8.24 percent on average through October, while similar funds that excluded fossil fuel companies returned 8.36 percent, according to Morningstar Direct, an investment research and data company.
Here’s what to know if you’re considering moving to more sustainable investments.
Know what you ownYour first step is to assess what’s in your existing portfolio. Start with the website Fossil Free Funds, which is run by As You Sow, an environmental advocacy group. There, you can look up the specific mutual funds or exchange-traded funds that you’re already invested in (or that may be on your workplace retirement plan menu) to see how they score on different measures.
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