Impact investors measure social and environmental performance. However, the investor's portfolio builds upon the investor's goals and intentions. Some impact investments may not make an environmental impact, while others do.
Impact investors evaluate a company's social and environmental performance in addition to its return on investment. The investor's portfolio draws upon the investor's financial goals and long-term intentions to improve the world.
1. Evaluate your financial goals, risk profile, and investment strategies. Do you understand how to invest? Are you able to manage your investments, or do you need to work with a financial advisor or broker?
2. Determine where you want to make an impact. Where do you want to make an impact, and how does it align with your financial goals. Once you've identified your passions, establish a financial plan to invest in those assets.
3. Increase your impact through regular investments. Set up an account with an online brokerage that allows you to make automatic contributions. Focus on dollar-cost averaging to build wealth over time and hold onto your investment plan for at least five years.
4. Get your finances in order. Pay off bad debt and prioritize investing. Establish good money habits that include budgeting and avoiding debt. Minimize unnecessary spending. Write your goals down and make a plan to achieve them.
5. Learn more about investing and impact investing. The best way to make solid investment decisions is to stay engaged in the markets and financial news. Learn how to invest as a shareholder. Challenge yourself to read one book about investing a month.