What is socially responsible investing and how teens (and parents) can get started



[00:00:00] Kriti: Hey guys, welcome to WhyFI Matter$! It's been a few weeks since I last spoke to you, so I hope you're all doing well. I'm super excited for today's episode. If you didn't know this already, I was chosen to speak at FinCon 2021. I'm one of the speakers there, which is such a huge honor. And it was even more of an honor because I was able to collaborate with other speakers to create a panel discussion on how the future of investing is sustainable investing. And, you know, due to COVID our talk was prerecorded, but FinCon is in a few weeks and I'll attend the event virtually. So I'm super excited to meet some really amazing, really cool people. Like I've already gotten the chance to do through the panel. And today's guest is Laura Oldanie is actually one of my fellow panelists. So I'm so excited to introduce you to her.

Laura is the founder of "Rich and Resilient Living" - money and lifestyle choices for regenerative future. She has been featured on many different podcasts, CNBC, and is pretty well-known throughout the personal finance community. I really think she brings something unique to the table because you know, she's an adult, but she has this focus on how her actions can harm or help our planet and the community surrounding us. And she's just so inspiring. She acknowledges this power that her money has and how she needs to direct it in a way that will benefit society and the planet. And this right here is the future of investing. So I'm super excited to learn more from her and about her and how we can all be financial activist in this sense.

I hope you enjoy the interview.


Hi, Laura. Thank you so much for coming on WhyFI Matter$ today. I'm super excited to have you on the podcast. And it's fun because I kind of have gotten to know you over our FinCon planning and finally making our talk, but I'm super excited to get to know you even more and really dive deep into what it means to be a financial activist and a socially responsible investor and how we can direct our money and make our money do good in society.

So I'm super excited to talk to you and thank you so much.


[00:02:41] Laura: Sure. Oh, thank you, Kriti for inviting me. I'm so delighted to get to connect with your audience, a younger audience that is going to deal with the future. And so start thinking about it now with our money.


[00:02:54] Kriti: Exactly. So having gotten to know you just a little bit, obviously there are FinCon planning and everything. I know that a life different than most adults that I personally know. For example, no, you do. You grow your own food or you have grown your own food and you leave a very much nomadic lifestyle and you also invest, but you invest with this goal of making sure that I'm not doing it just for myself, but I'm gonna do it so that it makes society better as a whole. And, I think are also very sustainable. And you have as an adult you have goals that many of us kids have. And many of us teenagers want to see in the world, which I think is really cool. So tell us more about your story and how you even became someone who really cares about the earth and societal issues, and really wants to make efforts to improve society.


[00:03:59] Laura: Well, and I love the though what you said about me being different than any of the adults in your life, because I'm very different than any of the adults in my life when I was your age. Similarly, I grew up in a very middle class standard American household.

And, I will say also though that there are plenty of other adults out there, like me. We may not be the mainstream, but we're out there. And so, yeah, there was traditional middle-class American childhood, but I guess some of the subtle things that were at play in the background, there were very service oriented parents, you know, volunteering, just caring about and being involved in the community, not so much over environmentalism, but definitely.

And appreciation of outdoor activities and, not leaving trash around and, just some basic care for the earth and the planet. And then, I think that coupled with there was always an interest in the background in all things, other cultures and other countries and wanting to travel.

And so then that got me into studying international studies in college and joining the peace Corps afterwards and serving as an English teacher in Poland.


[00:05:28] Kriti: Oh, that's cool.


[00:05:29] Laura: Yes. It was a wonderful experience. So anyone in your audience that may want a way to go overseas and serve, Peace Corps can be a wonderful way to do that.

So I encourage people to look into it. And then, you know, I came back, I went to grad school. And then I had a fellowship with the state department after grad school, which sent me back to Poland to work at the U S embassy there. And then once I came back to the U S, I got a job where I was working in education and traveling to many lower income countries.

And I really think that all of those experiences overseas, even starting with, you know, studying abroad in Spain and Poland and getting exposed to Europe and just seeing different lifestyles, different approaches to culture and living and how people can still live a rich life, different ways. And for sure, especially when I started going into lower income countries. So much of what we see out of the African continent or other lower income countries is hunger and starvation and illness and life is horrible. But there's so much joy.


[00:06:47] Kriti: Right.


[00:06:47] Laura: Like the singing, the dancing, in many of those countries, just there's a richness there that we in our wealthier affluent cultures have lost an appreciation for. So, starting to think more deeply and look more deeply at what role are wealthy, mostly Western countries playing in negatively influencing the economies of these countries, you know, our policies, our international institutional policies.

And so what role do we step back even further as voters and consumers and investors in these countries play. And so it was exposure to all of that and all of that kind of melded together.

And then I got introduced to permaculture. I had started gardening and growing some of my food and permaculture is a design tool. That is mostly applied in the landscape, but it's a very whole systems design tool that looks to nature's abundance, spaced system closed loop system as the model. And so we can look at that and apply it to all aspects of our life. And when I took my main permaculture design certificate courses, You know, there's a brief discussion in those courses is about money and economics, how we can do it differently.

And so how do we look to nature? There's so much wealth and richness in nature, and it's very synergistic. It's not comp competitive and Harwell together. Yes. It's not harmful to other creatures. Other people aren't disadvantaged in the pursuit of wealth. Yes. Yes. So it's all of these entities are helping each other to build wealth.

So how do we look at that and bring that into our human efforts to build wealth and live rich lives. And so that really got me thinking about that and pursuing that. And, so these days I not nomadic the way I once was I do own a house and spend my time in St. Petersburg, Florida. And, so I'm really looking at the landscape and, and building community. But, certainly those lessons from my nomadic life helped me with that. And now, I am 50 years old, so older than your audience. But I did come through that work life investing in more mainstream ways.

And so I had though learned about the socially responsible mutual funds, you know, and things that we could be investing in through the stock market and had moved my money into those, but that still didn't feel good enough to me. I don't like seeing plastic bottles all around and yet I was still supporting beverage companies, you know, and consumer products companies aren't working hard enough to come up with solutions to these problems. So it's like I'm funding all of these things, you know earning money for myself off of things that, on the other hand, I'm spending my time volunteering at beach cleanups. So that, that disconnect really bothered me and permaculture was just the impetus to think more deeply and start to think differently about building wealth.


[00:10:09] Kriti: So permaculture is using nature and the natural resources around us designing within them and building within?


[00:10:18] Laura: Well, it's not necessarily building within nature, but just stepping back and looking at nature's model. It's about relationships. So how do we create synergistic relationships in our landscape to start with? We're working with nature instead of not against.


[00:10:35] Kriti: Okay. I see. And then I guess I can also kind of lead towards not necessarily landscapes, but also our economy, how we interact with people.

[00:10:44] Laura: our built environment, our spiritual interactions, applied technologies.


[00:10:52] Kriti: Okay. I see. So I want to really understand what exactly social justice investing is and I know there's a lot of different components to it. I really liked what you said though, on your blog. Um, you said I have long believed that the vote I pass with my dollars is equal and possibly more important than the vote I cast at the ballot box. And that really struck me because it just shows how much power our money, has. Can you talk more about how our money supports institutions that do more harm than good?


[00:11:28] Laura: Sure. So you mentioned the term social justice investing, and that is definitely part of this. I'm going to step it back a little bit because there's social justice investing is kind of, a niche within a niche. Because, if we step back a little further there socially responsible investing. And, that can be in the stock market and wall street and off of it. Just like social justice investing.

When you're talking about social justice investing, that's one thing. When you're talking about socially responsible investing, it's a larger picture that also includes the environment change.


[00:12:07] Kriti: I feel like climate change is. It is a kind of social justice movement for our earth. It's justice for the planet. I know it's not technically like racial. It doesn't have anything to do with personal identifiers, like, um, cultural identifiers, but isn't it justice for our planet.


[00:12:27] Laura: Yes, you're absolutely correct. And I don't disagree. I just wanted to clarify for your audience. Usually, if you're looking up social justice investing, it's not going to be as focused on, you know, not investing in companies that use a lot of plastics because of its negative effect on the environment. It's going to be people who are thinking about social justice investing are, really honed in on whether or not their investments are harming or holding back people of color, women, our LGBTQ community. So, it's the human rights investing in a way, I guess when we talk about social justice investing.

And so, you know, one area that, um, a number of funds, you know, when we look at conventional mutual funds, What they're invested in is there are a number of companies and in some of those funds that profit off of our prison system, you know, our prison system in the United States is a for-profit prison system.

And so justice in this country. Is not served appropriately the way it should be. I, it negatively impacts people of color, much more than white people. And so if now that we've created a fourth turn to a largely for-profit prison system, the incentive, the money is going to come from having people incarcerated.

You know, that's where those PE companies are making money. If there are fewer people in prison, those companies are making less money. And so who in our country, in the United States, what percentage of the prison population? You know, if we look at it by race or color, it's largely a system of people of color.

And so, if you're out there advocating for black lives matter, But then you're invested in these funds that are supporting these for-profit prison company, prisons and prison system. Yes. There's the disconnect or, if we want to go to. An environmental level, you know, thinking about banks, you know, if you're invested in one of the mega banks, the Chase, the Wells Fargo, the Banks of America.

Those banks chase in particular is the largest funder of the fossil fuels industry. They're lending money to the fossil fuels industry so that the fossil fuels industry can go out there and continue to extract oil from some of the hardest to reach places. It's the most destructive extraction of oil.

And so maybe you've divested from fossil fuels, but if you haven't divested from these major banks, you're still funding this harmful practice.


[00:15:36] Kriti: Wow. I didn't realize all of this behind the scenes stuff. And how are we supposed to know this though? Like, how am I? Cause I don't think chase wants people to know. They won't put it up front. They won't display it around him. And their buildings. Like we just have to do our research.


[00:15:55] Laura: Yes. You have to ask questions. There is no easy, super easy way. You're right. They're not going to advertise it, but it's in the media. You know, once if you, when we finish this podcast, if you Google search, chase fossil fuel funding, you'll find lots and lots of articles.

It's in the main stream. There's so much information out there available to us. Now there's so much that we're not aware of, in all kinds of different realms, but yes, we no idea. We just, we have to find good sources, that are talking about these things and follow them.


[00:16:35] Kriti: So what exactly it is social justice investing? How does it have a role in systemic racism.


[00:16:47] Laura: Sure. So a little bit is what we just talked about with the prisons. Some of these companies in these funds are involved with prisons. For-profit prisons. They're making money off of being involved in immigrant detention centers. So these are companies that are exacerbating or at least upholding systemic racism.

And so if you're out there trying to work to end racism, with your activism where you're volunteering; your money, stay mil still may be perpetuating it through, you know, being involved in surveillance. So again, it's just a matter of educating ourselves about what these companies are involved in.

And there are tools, there's a wonderful tool called "As You SOW". And um, you heard Janine talk about it and our FinCon presentation. And there's even a tool specifically to search for prison funds. So you could take your fund ticker, you know, that abbreviation and plug it into that search engine and see how it ranks in terms of is involved with supporting for-profit prisons.

And similarly, there's a search for women because when we talk about women as a social justice investment.


[00:18:13] Kriti: gender equality,


[00:18:14] Laura: Yes. Gender equality. What does the board of the company or invested in look like? Are there women on the board? Are there people of color on the board?

That's another way to look at. And I believe in "As you SOW" there is some kind of gender screen where you can look and see are women on the board? Are they nurtured through the management process to be brought into higher level positions?

[00:18:40] Kriti: First of all, I'll put "As you SOW" info in our episode description, I think it's a really good source to use, but do you think any of these companies, um, they might like support black lives matter, like outwardly, but they still are contributing to, um, like incarcerations?

[00:19:01] Laura: No, I think you have to really look and, yes, it can happen. What you're saying that it can be, you know, they put one face out to the public. And they're doing something completely different in their practices. It's not just social justice investing. I mean, very much so when we look at it more about environment, if you're trying to not negatively impacted the planet or the environment, there's so much greenwashing. Right.


[00:19:28] Kriti: Totally.


[00:19:29] Laura: You know, so in the same thing can cross over to social justice. If your audience is interested, you know, it sounds like maybe you're encouraging your audience to look into working with their parents, to do some investing or learn more. There's something called the "ADASINA". Now that's "A D A S I N A social justice index". And that ticker for that is just the word justice. So that is a screen. That fund has a screen that was put together by a black lesbian financial advisor who did a lot of research over the years to come up with what is called the racial justice exclusion list.

So she has done a lot of that research into which of these companies are supporting systemic race racism, and not including them in that fund.


[00:20:25] Kriti: Okay. That's really cool. So since we can't really. Invest obviously now, I think another thing is directing our parents.

Like everyone, every like everyone who's listening. , I know your parents definitely probably invest. I know a big portion of US adults invest, but try to direct your parents to these websites. And even though you can't do them right now, you can make your parents cause you have the power to influence your parents.


[00:20:58] Laura: Kriti, can I say a little more along the lines? Because what I have done now is I still have a little bit of money in the stock market, probably about a third of my retirement savings, but I've moved most of my retirement savings out of the stock market into what's called a Self-Directed IRA. And so I'm looking at a whole new range of emerging investing opportunities.

That are much more effective even in, helping to address our major social and environmental challenges as opposed to exacerbating them. And so, they're very risky. Well, let's put the, this all out there. Um, that I am not a financial advisor. This is the disclaimer. You know, this is a learning journey for me.

You heard my background. This is just me just sharing educational and informational pieces of what I've learned along the way in my efforts to put my money, to work, to create the world, I want to live. Which I don't feel like I can do through the stock market. Now I will back up before I go into what I've been investing in and also point out something that if you are in the stock market or your parents are there's something called "Shareholder Advocacy".

And that's when, if you own $2,000 worth of a stock directly. You can be making your opinions known to that company and in our actions. And even if you're invested in mutual funds or index funds, which many people are, you could reach out to the fund manager to express your concern. So there is a voice to be had as well, even in the stock market, but outside of the stock market, I've started one thing that's really important to me, um, with nature is "Regenerative Agriculture".

So conventional agriculture is very harmful to, um, to the land, to the soil. And so I'm finding ways to. You know, I've invested in a local farm. I have own a share of a local farm I've lent money to a friend who saved our longest running organic farm here in Tampa bay. I have made loans through a platform called "Steward".

It's an online platform that anyone can access. You can do this with your parents. You can look at it with your parents. Maybe you couldn't get your parents to invest with you and go on this journey where you make a loan to a regenerative farmer for a project, and you earn interest on the loan. There's also, if we're looking at social justice, there's something called crowdfunding, which is not specific to social justice.

And usually it's more from a conventional perspective of just trying to make money from investing in a business. But we can go into those platforms like "WeFunder". And we can screen for companies that are being started by people of color or women or in our local community, or that they're addressing some kind of social or environmental issue. So, I invested in a native American food company through one of these startups. I invested in a company that has a software that facilitates communication between migrant farm workers and farm managers, helping that relationship be better. And they've added a financial literacy component to their work for the migrant workers. So you can really find options that feel like, yes, this is more towards the solution than the problem. An electric tractor company. I invested in. There's a company called American homeowner preservation that is working to help people who are at risk of foreclosure of losing their home because they can't pay their mortgage. And so they're buying up these distressed they're called distressed mortgages when people are at risk of losing their home because they can't make their payments.

And they're working with those families to help save, keep them in their home. So they don't lose their homes. And so you can invest in American homeowner preservation and they'll use your money to help people stay in their homes and you'll earn a profit.

[00:25:16] Kriti: I see. I feel like it might be a little new for a lot of the people listening, you know, like. Obviously whenever you investors are at risk, but how are we supposed to get across this message that it's actually good for you as well, investing in these companies? Like how can we get this across? Because a lot of people are still very much hesitant towards investing in non traditional companies.


[00:25:42] Laura: One easy, easier way to approach this. I'm going to start with that easy way. And then I'm going to go to the harder, bigger picture. An easier way may be to, instead of making a philanthropic donation. You know, start with some of that money that you were going to donate anyways, that you didn't plan on getting back and then put it towards that. And if you lose it, you still did good, and it wasn't, you weren't going to have that money anyways, and that you, you will likely, or earns the money back.

But again, right, they are risky. There are risks. There are risks to putting money in the stock market. Like you said, the other thing I would. Um, I'm excited to get young people thinking about this already is. There's an accounting framework called the "triple bottom line". So when we're investing generally conventionally, we're only thinking about the single bottom line of profit of how much money we're going to earn.

The triple bottom line is thinking about people, planet and profit. So how are we impacting people with our investment, how are we impacted impacting the environment with our investment? And then what's the profit. We have to recognize that with these investments, what we're achieving is the triple bottom line.

And so, you know, for so long, why are we facing these environmental challenges, these social challenges. So much of it comes down to, we have only prioritized the dollar bottom line. And so. For your generation, especially if you want to live in, uh, on a planet with clean air, with clean water, you know, maybe your dollar profit right now, isn't going to be as high as it could be in the stock market.

But your quality of life and longevity is certainly going to be better.


[00:27:36] Kriti: There's a bigger cost. If you don't invest in this triple bottom line.

[00:27:42] Laura: Yes. It's just harder for people to see right now.


[00:27:46] Kriti: And I feel like we really have to reframe investing and not just think about investing wall street, men, money, money, money, but investing is investing in our, in society.

It's investing in the humans around us, the nature surrounding us. And then obviously, You do want to make money because you're investing is what you're trying. You're, that's the definition of investing, obviously, you know? Um, so I think we have to really like reframe.


[00:28:21] Laura: Yes. And Kriti, I think it's so imperative that not only do we reframe how we think about making a profit, but what we think about as wealth and what does a wealthy life look like? What is a rich life is a rich life. You know, looking at stock market charts all the time and spending all your time at your computer in an office and feeling like, oh yeah, I got the next deal. Or I made that money or is a wealthy lifetime with your family time outside hiking, you know, laughing with friends. What is a wealthy life? And which path is going to get you to that wealthy life.


[00:29:00] Kriti: Have you ever like compared investing habits and mindsets in different countries?

Because I feel like, especially in America, we have that mindset that I described before, but in other countries they might focus more on, spending time with your family and enjoying. It's not all about this hustle. It's not all about trying to get more bigger, you know?

So do you think that in some of these other countries are actually doing the triple

a triple bottom line, bottom line?


[00:29:36] Laura: Maybe not necessarily intentionally. And maybe yes, some intentionally, I think there are multiple answers to your question. I think to some extent, yes. I think. You know, culturally, the many of them are more directed to that.

I think unfortunately many of them are looking to America and trying to pursue our way of wealth. But it's also comes back to some of what we talked about earlier. How our government and other governments and international bodies are pushing these countries towards this path.


[00:30:06] Kriti: Right.


[00:30:08] Laura: But I also think so, going back to this broader discussion of wealth, you know, wealth is more than money.

There are other forms of wealth, you know, it's this wealthy life, this rich life. And I think, especially in lower income countries where they haven't even had a chance to pursue wealth the way we do in America. Like if we look at India, I've heard, Jaspreet Singh of the minority money mindset.

Talk about how in India. So often a family's wealth is stored in the gold jewelry around women's necks, you know, or on their wrists or on their fingers. So it's a different way now gold is extractive, but again, it's a different way of thinking about wealth. Or if we look at again also in lower income countries, investing in livestock, You know, so it's, it's, it's a store of value, the livestock, cause it's, if you needed to sell it, it holds value.

You could get money for the livestock, but often if it's chickens, for example, you know, they're laying eggs. So they're providing value. So, you know, or planting fruit trees.


[00:31:18] Kriti: Right. I think investing is, it's not just money, like whatever provides you value. It's not as if I have to be a dollar sign attached to it.

So. I want to touch a little bit on other ways that we can direct our money. So I read a little bit on your blog about something called impact banking. Can you explain to the audience and even to myself a little bit more about what exactly it is?


[00:31:45] Laura: And again, I'm going to step back because there is this broader term that is may, maybe people will have heard about ethical banking. It's more often talked about as ethical banking or socially responsible banking. And again, impact banking is more of a niche of that because ethical banking could be, a banking option that is looking more at environmental impact.

So just when I talked about impact banking in that piece that you saw, I was, it was along the lines of social justice banking. So a lot of lower income communities need access to capital. That's obvious, you know, they're lower income. So capital is hard to access. We can look for banks that help direct capital to them communities and we can bank with them. And when, because when we put our money in a bank, it doesn't sleep there. The bank is using your money for something. So like I said, with the major mega banks, a lot of them are using it to fund fossil fuels, for example. But so all of that money that you've put in the bank is not there. It's the bank is using it for something to earn more money for itself, but we can make, we can try to get our money in banks where it's being used for positive things. For example, there is a native American bank. That's based in Colorado. And so they're making loans to native American communities. So if a native American family is trying to get a loan for a mortgage, to buy a house, you know, they're more likely to get that loan from the native American bank in their community.

More, if a native American is trying to start a business, they can approach the date of American bank for a small business loan. There are also what are called community development, financial institutions. And not all of them are banks, but many of them are like the Hope credit union and Mississippi.

So, so much of our banking is online these days. Right? So you could open a bank account with one of these banks. And then your money is going to be directed and put, to use lifting up these communities and giving them access to money and financial capital that they otherwise wouldn't have.