Juggling your financial commitments and sticking to healthy money habits may feel like a challenge. With so much to keep track of, it might be easy to lose sight of the bigger picture and what matters most to you.
Yet, aligning your finances with your core values could be a powerful way to foster a sense of purpose and stay motivated to achieve your goals.
Whether this means changing the goods and services you buy or the organisations you support, integrating your ethics with your financial plan might allow you to positively affect the world around you – while also boosting your personal satisfaction.
So, keep reading to learn four helpful tips for ensuring that your financial decisions reflect your values.
1. Spend with intention
In today’s modern world of television ads, social media influencers, and frictionless payments, the temptation to spend could feel overpowering and relentless.
It’s often quick and easy to zap your debit or credit card, transfer funds online, or even pay for goods and services with your mobile phone. This digital currency may not even feel like “real” money – at least not in the way that handing over hard cash may do.
As such, you might find yourself mindlessly spending on things you don’t need. Indeed, “lifestyle creep” – automatically increasing spending in line with your income – may feel hard to resist.
On the other hand, spending intentionally ensures that each purchase you make is a considered act that reflects your core values.
For example, if you believe in supporting small, independent businesses, you could make a deliberate choice to patronise local shops over large chains.
Not only could this provide valuable support to causes that are important to you, but it could also help you avoid overspending – freeing up more cash to save and invest towards your future.
2. Put your values at the heart of your investing decisions
Of course, your long-term financial goals are a crucial consideration when choosing how to invest your wealth.
If you’re focused on building the wealth you need to retire in 10 years’ time, you’re likely to make different investment decisions than if you have another 40 working years ahead of you.
However, you could direct your wealth to opportunities that not only offer the financial returns you need but also align with your personal values and beliefs.
Indeed, a report by Morgan Stanley has revealed that 77% of individual investors globally said they are keen to invest in companies or funds that aim to achieve market-rate financial returns while also considering positive social or environmental impact.
To this end, you might want to consider:
- Socially Responsible Investing (SRI) – Investing in companies or funds that have positive social impacts.
- Environmental, Social, and Corporate Governance (ESG) investing – A set of non-financial factors that could help you screen investments based on how sustainable and socially conscious they are.
- Impact Investing – Aims to create positive social and environmental change.
Just remember to check that any investments that appeal to your ethics, also fit with your appetite for risk and investment time horizons.
3. Select financial products and providers with care
When you look at your finances, you probably have multiple accounts with various financial institutions, from banks to pension providers.
Factors such as interest rates, digital banking features, investment funds and flexibility, may all be important when choosing where to save and invest your money. However, you might also want to take your personal values into consideration.
Fortunately, the development of online banking means that your choice is no longer limited by geography. There’s a wide range of providers, each offering products and services that cater to different environmental, social and political concerns.
With a little research, you could find providers that hold similar values to you on the topics that matter to you the most.
For example, if you’re passionate about environmental causes, you might want to look into banks such as Triodos, which describes itself as “one of the world’s most sustainable banks”.
This organisation caters to “individuals and organisations who want to change the world for the better”. Their website also clearly shows every business and company the bank invests in, which could help you to decide whether this organisation aligns with your core beliefs.
It’s also worth reviewing your financial products to check that they match your outlook on life. Drill down into the funds your pension is invested in. Do they align with your ethics? If not, you might want to explore alternative options.
However, before transferring your pension there are some important factors to consider, such as whether you could be liable to pay exit fees to your current provider. So, you may benefit from speaking to a financial planner before making any changes.
4. Review and adjust your financial plan regularly
As you move through life, it’s likely that your values and priorities may change. So, it’s important to regularly review your financial plan to ensure that it remains relevant to who you are and how you see the world.
A financial planner can help you reflect on your goals and identify opportunities for managing your wealth in a way that more closely aligns with your ethics. They can also provide the insight and guidance you need to make an informed decision about any changes you may be considering.
Get in touch
If it’s been a while since you reviewed your financial plan or you’d like help adjusting it to better suit your values, we can help.
To find out more, please get in touch. Email hello@sovereign-ifa.co.uk or call us on 01454 416653.
Approved by Best Practice IFA Group Ltd on 11/02/2025
Please note
This article is for general information only and does not constitute advice. The information is aimed at retail clients only.
All information is correct at the time of writing and is subject to change in the future.
A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance.
The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.
