The Problem With Investing (And What You Can Do About It)

Knowing vs. Doing

My 2-year-old son, Hank, loves to play with trains.  If you ask him who owns the train table in our house, he’ll tell you, “God and Jesus”.  He’s learned that God owns it all, and that God gives us things to enjoy and share with others.  The problem is, when it’s actually time to share, Hank becomes a hoarder.

Hank can say that God owns it all because that’s what he’s been taught.  But his actions indicate what he truly believes: “everything is mine”.  His head knowledge has not translated into action.

In this post, I share how you might be missing the boat when it comes to biblical financial stewardship and what you can do about it.  But I hope that it doesn’t just become head knowledge.  My prayer is that you use this information to take action.

Stewardship and Investing

When you hear the word “stewardship”, what comes to mind?  You probably think about giving or budgeting.  But what about investing?  While giving and budgeting are two crucial aspects of good financial stewardship, investing is just as important.

Here are two good reasons to view your investments through the lens of stewardship:

  1. Your wealth is God’s money.  As a steward you’re called to manage and protect the resources entrusted to your care.  The Bible clearly calls you to “Honor the Lord with your wealth” (Proverbs 3:9).
  2. Investing means taking an ownership interest in a business.  When you invest in a profitable business, you directly benefit because as an owner you share in the profits (see Stocks, Bonds, & Lemonade).

As a manager of God’s money, you should care about the financial AND eternal implications of your investments.  Biblical financial stewardship is about more than just money.

The Problem With Investing

Greed is a part of human nature.  Nowhere is this more prevalent than in the capital markets.  You don’t have to look far to find businesses that willingly take advantage of others for the sake of profits.  And if you don’t actively monitor your investments, you probably own some of these businesses.

Let me give you a quick example so you can better understand how a company that you may own in your portfolio preys on the weaknesses of others for the sake of profits.

Let’s say that through one of your mutual funds you own stock in Hyatt Hotels (ticker: H), a well-known hotel chain.  After owning the stock for a few years, you find out that a major source of the chain’s profitability is pay-per-view pornography (sadly, this is true for Hyatt and many large hotel chains).  Should you continue to own the investment?  If you do, you’re using God’s money to support and encourage the sale of pornography to hotel customers.

Unfortunately, I’d be willing to bet that a substantial portion of your portfolio is invested in companies that undermine your values and beliefs (similar to Hyatt Hotels).  In fact, you may unwittingly own strip clubs, casinos, abortifacient manufacturers, and many other types of businesses that are harmful to others.

(My intention is not to send you on a guilt trip, but rather raise awareness about this often overlooked area of stewardship)

The Solution

So what can you do?  You don’t have time to do in-depth research on every company in which you invest.

That’s where Biblically Responsible Investing (BRI) comes in.  BRI allows you to avoid investing in companies that harm others for the sake of profit.  It’s about loving God and loving others.  Using BRI, investing becomes an act of worship as you seek to glorify God through your investments.

(To learn more about how BRI works, check out the links to BRI resources near the end of this post)

Although BRI has been around since the 1980’s, it’s only recently started gaining traction with advisors and investors.  In fact, what started as a small movement has grown into something much bigger with billions of dollars currently allocated to BRI strategies.  Also, there are more and more BRI mutual funds available today than ever before.

At Three Nine Financial, we use a BRI screening tool to make sure that your portfolio doesn’t undermine biblical values.  Our unique investment process seeks to weed out companies that harm others and invest in companies that are doing well by doing good.  Click here to learn what business activities we screen against.

Show Me the Money (Or Not)

You may be wondering (as I did when I first learned about BRI) what kinds of returns you can expect.  Will they be comparable to market returns (or worse)?  Past studies have asked the same question and found that biblically-screened portfolios have actually outperformed the market over the long-term.  (CIF Whitepaper, BRII Whitepaper)

However, there’s no way to know if this outperformance will continue in the future.  But should you still adhere to BRI even if biblically-screened portfolios underperform for the next 10 years?  Absolutely!

Imagine that an acquaintance has just approached you about investing in her new business venture.  As an investor in her business, you’re guaranteed to double the market’s returns over the next 10 years.  Sounds great, right?  But after further discussion, you learn that her business manufactures a product used in abortion procedures.  Would you still do it?

The ends (profit) don’t justify the means (funding abortions).  Or as Proverbs 16:8 says, “Better is a little with righteousness than much gain with injustice.”  In God’s economy, HOW you make money is more important than HOW MUCH you make.

Main Takeaway

As an investor, you have a responsibility and a calling to honor the Lord with your wealth.  The best way that I’ve found to do so is to love your neighbor through your investments.

Do Something

“The way to get started is to quit talking and begin doing.” –Walt Disney

If any of this resonates with you, do something about it!  Here are three concrete actions you can take to make sure your knowledge translates to action.

Action 1: Watch the short video below for a great explanation of BRI.  Learn more using the links below the video.

Action 2: Prayerfully read the Bible for discernment and wrestle it out with God.  Decisions are best made when filtered through scripture.  Also, seek counsel from a Christian financial advisor and/or your pastor.

Action 3: Learn what activities you’re supporting through your investments.  Click here to get a complimentary analysis (sample report).

Last Words

When I explain the concept of BRI to other Christian investors, the most common response is, “I’ve never even thought about where my investments are going.  I just put my money in and forget about it.”  And I had a similar response when I first heard about BRI.

But God showed me a better way, and He’s called me to share it with you.  That’s what this post is about, and that’s why I do what I do.

My prayer is that you see the importance of aligning your investments with scripture and feel compelled to do so.

If you have questions or want to discuss BRI in more detail, I’d love to chat.

Ben Malick, CFA

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