In the wake of the financial crisis and the public's disgust with some of the big banks and investment firms involved, many people have re-evaluated their choices as to who to trust with their money and financial affairs. For a growing number of people, the solution seems to be Christian investment firms. Not only do these faith-based firms instill a feeling of honesty and trust, but they also appeal to those who want their investments to line up with their beliefs.
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A Booming Business
Many Christian investment firms have seen a surge in business since the recession began, and say people are eager to find financial advisors who seem ethical and trustworthy. (For those who follow a particular faith, this is just one more form of socially responsible investing. Learn more in Faith-Based Investing: An Inspired Choice.)
"Over the past couple of years, investors have become keenly aware of the need to work with investment firms and advisors that are trustworthy and responsible, and they are paying closer attention to the values and ethics of the firms with whom they do business," says Dan Nielsen, director of socially responsible investing at Christian Brothers Investment Services.
"Our firm was founded as an investment firm incorporating the faith values of the Catholic Church into both how we conduct our business and selecting the companies in which we invest. The integration of faith and finance is more important than ever in this era of skepticism and uncertainty."
Faith-Based Investment Choices
It's not just the faith-based advisors themselves that appeal to these clients - it's also their focus on investing only in areas that coincide with Christian values and beliefs.
"As a firm investing exclusively on behalf of Roman Catholic institutions, CBIS has developed an expertise on how Catholic moral theology can be applied to the investing realm," says Nielsen.
"Not only does CBIS avoid investing in companies who derive revenue from problematic activities, such as the production of major offensive weapons, but we also pursue shareholder advocacy with companies in our portfolios in order to improve the world in which we live. Christian investment firms can help investors avoid deriving benefit from the illicit activities of certain companies while at the same time engaging other companies in order to help society and the environment."
A Christian Tradition
Many involved with faith-based investing say that sound money management was a priority even in biblical days. (It's hard to keep your emotions in check while you play the stock market, but it will help you make better decisions in the long run. Find out more in Your Personality Is Your Investment Strategy.)
"The Bible has over 2,000 references about money, which means it was an important subject to God who wants us to be good stewards of what he has blessed us with," says Randy Brown, chief wealth strategist at BriteLine Wealth Management in Fullerton, California.
Just a Clever Marketing Tactic?
Savvy consumers may have noticed a trend of companies using the "Christian" label as sort of an advertising buzzword. There's even a weight loss program being touted as a Christian diet plan. So these firms are accustomed to a little bit of skepticism.
"In some instances, attaching the 'Christian' label to something may indeed be a marketing ploy," says Nielsen. "In other instances, it may accurately describe a product or service that has effectively incorporated Christian values." Nielsen encourages consumers to research an investment firm before conducting business with them. (These investments may pose a greater risk, but for brave investors, they're worth the stress. Check out Extreme Investing: World's Riskiest Investments.)
"Some key questions to ask concern how long the firm has been in operation, whether product information is transparent and complete, how Christian values are incorporated throughout the firm, and how those values are reflected in the investment programs. As with all things, unsatisfactory answers should lead to additional questions."
The Bottom Line
If you're seeking a financial advisor or investment firm who will tailor your investments to your beliefs, a Christian investment firm may be just what you need. However, as with every financial situation, it's important to do your research before entering into a business relationship with any company - regardless of any faith-related focus they may have.
Don't miss what's happening this week in the financial world. Check out Water Cooler Finance: Buffett's Bank Fraud And Financial Eruptions.