Ethical Investing Ideas: Ways to Invest in a Socially Responsible Way

More and more people are becoming interested in the idea of ethical investing. The thought of doing good, or at least not supporting harmful companies, is a motivator for many investors these days. And the good news is that it ethical investing can also provide you with opportunities to make money. Here are some investing ideas that are socially responsible:

Environmentally friendly investing

Clean technology is offering many opportunities for investing. If you are concerned about the state of the environment, there are industries such as wind and solar that promote environmentally friendly energy sources. These are great opportunities because right now clean technology is in a pre-growth stage. If you choose carefully, you may find some good bargains that yield high returns down the road.

Another way to invest in a good environment is to do give money to companies with environmentally friendly practices. Choosing companies that are on the Top 20 Sustainable list, or companies that make up the Sierra Club Mutual Fund can be good ways to find companies with pretty good environmental practices. While it may be impossible to choose a company that is completely sustainable and environmentally friendly, you can feel better by steering your investing dollars toward the companies with better practices.

More ideas for environmentally friendly investing, along with some companies to watch, can be found in the book The Clean Tech Revolution.

Investing in others

One of the most interesting and innovative ethical investing ideas is that of micro loans. Micro loans are loans in small amounts to entrepreneurs living in some of the world's poorest countries. You can invest in them, helping them to improve or start solid businesses. For as little as $25, you can work through organizations like Grameen Bank and Kiva to lend money to the less fortunate. They pay you back with interest, and that is how you earn a return.

The reason this works out so well is that you are giving a helping hand, rather than a hand out. Most of the entrepreneurs are honest and hardworking. Micro loans have a 99% payback rate. And the interest on the micro loans is fairly low. Many in poverty stricken countries find that interest charged on even the smallest loans from local banks and predatory lenders make the money impossible to afford. Micro loans through reputable non-profits, however, charge about 7% interest, which is manageable.

There are plenty of ways to earn money while being socially responsible. Ethical investing can help you feel good about the way you earn an investment return.

Disclaimer: I am not an investment professional. All investment carries risk of loss. You should do your own research and/or consult with an investment professional before making any investment decisions.