How to align your portfolio with your values

A life insurance policy may meet more of your financial needs than you think.

Sticking with any financial plan through inevitable market volatility requires emotional commitment. And that type of resolve may be easier to muster when your plan reflects your perspectives, preferences and priorities. Investing according to your values allows you to do just that.

Though the idea is often associated with selecting investments based on environmental, social or governance criteria, it’s more accurate to think about this type of investing as aligning your investments with what matters most to you.

But how do you define your values? How do they translate into an investment plan?

“Values are enduring, guiding principles about what we consider as desirable or having worth,” says Josh Fendley, Portfolio Manager with Regions Asset Management in Arkansas. “They’re also intangibles that keep us motivated, and they vary from person to person.”

Values and convictions

Values are not the same as convictions, and in an investment context, that’s a key distinction, says Fendley. Convictions are strongly held beliefs, such as your opinion on global economic events. Convictions are an important part of who you are and can guide how you spend or donate your money. When making investment decisions, though, relying on your values may be more useful—and more likely to support your commitment to sticking with a financial plan.

We each have a wide range of values, and some can guide our investment decisions. You might value personal freedom, personal autonomy and agency, financial satisfaction or resilience—both emotional and psychological—to normal market volatility.

Translating values to investments

Start exploring your values by considering what’s most important to you. “Think about the ideal vision for your current reality and the ideal reality you’d like to experience in the future,” Fendley says. “What does being financially satisfied look and feel like for you?”

Fendley acknowledges it’s not necessarily easy to answer that question on your own. It’s also not easy to determine your values and separate them from your convictions. That’s where a conversation with your Wealth Advisor can help. They have likely thought carefully about their own values and convictions and therefore understand the process, which can resemble soul searching.

With your values defined, you’ll be on track to build a portfolio focused on what matters most to you, which is what investing according to your values is all about.

Talk to your Regions Wealth Advisor about:

  1. Defining your values and convictions.
  2. How to best align your portfolio with your values.

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