There’s been a lot of talk in the news lately about impact investing and what it means to get a social and environmental return on top of a financial return. In addition, there’s also a growing movement to align your investments with your values. Do you know where your money is actually invested? Are you invested in companies that may be partially responsible for the deforestation of the rainforests? When you invest locally you'll know where your money is and you'll be supporting your community.
Local businesses are at the core of a sustainable economy and economic development. As Amy Cortese, who is best known for her blog and book Locavesting, explains, “ownership matters”. Local owners are important stakeholders in our communities as they contribute by providing products, services, jobs, tax revenues as well as general support. They might even hire your child for a summer internship. And we need to support our local business owners.This is known as the “multiplier effect” as money recirculates in the local economy.
Top Reasons to Invest Locally
1. Know where your money goes. You can meet the business owner, directly support them and celebrate their successes.
2. Get more than a financial return. Getting a social and environmental return on your investment is good for you, your family and your community.
3. Support your community. When community members pool their resources together they create more vibrant local economies.
4. Job creation. When you invest locally businesses can grow and create more jobs.
5. Larger tax base. As businesses grow they create a larger tax base that supports infrastructure and community resources.
6. More businesses, more people. As communities become more vibrant they will attract and retain professionals and services.
7. Environmental impact. When we support our local businesses, we will have more to purchase locally thus avoiding shipping and lowering our carbon footprint.
Are you convinced yet? There are a lot of ways to be investing locally and chances are you’re already doing it. If you can answer yes to any of the following questions you’re already a local investor:
- Are you a member of a local co-op like City Market, Hunger Mountain or Brattleboro Food Coop?
- Do you bank at a credit union like VSECU or Opportunities Credit Union?
- Do you sign up for a CSA share (Community Supported Agriculture - a pre-sale) from a local farm like the Intervale, Jericho Settlers or Bread & Butter Farm?
- Do you donate to local charities?
Yes, yes, yes and yes. Let’s count the ways.
Here’s a list of ways you can be investing locally:
- Banking Locally
- Being a member of a coop
- Community Loan Funds
- Donation and Rewards Crowdfunding
- Equity Crowdfunding
- Opportunity Zones
- Peer to peer lending
- Private Offerings
- Investor Networks
And there are more ways being developed as you read this!