Socially responsible investing continues to expand in popularity as a way to invest with your values. From socially responsible mutual and exchange-traded funds to robo advisors and mobile apps, there’s easy access to this investing trend.
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Popular among younger and older investors alike, here are five apps that put socially responsible investment firms at your fingertips:
— M1
— Impact by Interactive Brokers
— Ellevest
— Wealthfront
— Betterment
M1
M1 has grown into an investing buffet with stocks, funds, robo advisors and hundreds of premade portfolios, which the company refers to as “pies.” These pies can either be customized to meet your personal financial goals and preferences, or you can choose from a predesigned “Expert” pie, says Brian Barnes, CEO and founder of M1. And yes, there is a “Responsible Investing” pie, which adds international socially responsible investing, or SRI, funds for global exposure, but you can also build a custom socially responsible portfolio.
“In designing their own pie, clients invest based on their convictions and can share their pie with like-minded users,” Barnes says. “M1 has a page of community pies where users can find links to ready-made pies that allow them to invest in minority-led or sustainable businesses.”
All you need to do to get started is download the app, open an account, tap the research option and choose your premade pie or start building one of your own.
[READ What Is Sustainable Investing Portfolio Management?]
Impact by Interactive Brokers
Voted the top ESG Broker by BrokerChooser in 2022, Interactive Brokers’ Impact app is becoming a popular choice for SRI through a robo advisor. You get commission-free trading on U.S. stocks and ETFs and can start with as little as $1 through fractional share investing.
The app helps you align your portfolio with your values by first having you identify what your values are — from gender equality to environmental health. You can also choose business practices to avoid, such as weapons manufacturing or animal testing. Then see how each company or ETF aligns with those values on an impact values scale. If you don’t like how a stock fits your values, you can swap it for a better fit with one click.
Ellevest
Andrew Bellak, CEO of Stakeholders Capital in Massachusetts, recommends Ellevest as one of the best socially responsible investing apps. The Ellevest robo advisor targets women investors, though it is quite suitable for men, too.
Ellevest Impact Portfolios invest in three sections of the SRI environment: companies with women in leadership, firms with higher standards for sustainability and ethical practices and companies that provide loans to support community services.
The Ellevest Impact Portfolios not only include SRI criteria but also focus on diversity and tax minimization strategies.
Betterment
One of the first robo advisors, Betterment launched an SRI portfolio in 2017, responding to consumer demand for socially conscious investing. The cost is a low fee of 0.25% per year plus fund fees.
You can choose from three socially responsible portfolios — focused on climate, social impact and all ESG elements — or invest a bit of your money in all three. Though, if you choose to triple down, note that each portfolio includes Engine No. 1 Transform 500 ETF (VOTE) that uses proxy voting to push companies to do more good.
It’s also worth noting that Betterment’s SRI portfolios do not include any bonds. When you sign up, you’ll be asked to choose an allocation to stocks and bonds. Any money you put toward bonds will not be invested in SRI portfolios.
Wealthfront
Wealthfront is another popular robo advisor with a highly rated app. Through their automated investing services, you can design a SRI portfolio around sustainability, diversity or equity.
To be used in one of these SRI portfolios, ETFs must meet one of the following criteria:
1. Track a SRI index or environment, social and governance, known as ESG, index.
2. Exclude companies involved in environmentally harmful businesses.
3. Favor companies related to positive environmental impacts.
4. Favor companies with policies and practices that support women, minorities or members of a disadvantaged class.
Best of all, Wealthfront’s experts have crafted these SRI portfolios to provide similar expected returns to the non-SRI “Classic” portfolio, so you won’t have to worry about sacrificing returns by investing for the greater good.
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5 Apps for Socially Responsible Investing originally appeared on usnews.com
Update 03/09/23: This story was published at an earlier date and has been updated with new information.
