The Powerful Intersection of Mindful Finance and Impact Investing

In this increasingly complicated world we all receive advice from many channels, including our phones. Financial planning and investment advice is no different. We believe it’s important to step back, quiet the noise around you, and think holistically about your money – how you save it, how you spend it, how you plan for future spending goals, and how you invest it. Sol Halpern , President of Highlander Wealth , practices an approach to wealth management and investment advice called mindful finance.

Sol is an advisory board member of Green Alpha Advisors, LLC and has client assets invested in Green Alpha strategies, using them to help fulfill his commitment to preserving and increasing their wealth with a holistic, mindful approach. Green Alpha’s COO, Betsy Moszeter , recently sat down with Sol to better understand Sol’s approach.

Betsy:  Sol, help us better understand what mindful finance is?

Sol : The message of mindful finance is that paying attention to our experiences, both mental and emotional, within a financial context, is useful and valuable. We don’t always use our complete intelligence when making investment and other important financial decisions. With mindful finance, we help clients tap into the full gamut of senses, intelligence and awareness to make smart money decisions.  Because when we make financial decisions that are contradictory to what we're feeling, or that don’t tap all of the information we have access to, those tend to not be the best decisions.

Betsy:  Explain how you help clients engage their hearts, minds and guts to make more meaningful, holistic financial decisions.  

Sol : We have a technique we use with clients, and on ourselves, that can be simplified like this: Breathe, Feel, Speak. From a mindful finance context, the Breathe aspect is about grounding yourself in your experience so you're not lost in your head and disembodied mentally. The Feel is actually getting a sense of what is going on for you beyond whatever is in your head. Speak helps clients give voice to their thoughts and feelings that would otherwise remain bottled up. It takes a lot of bravery to truly speak at first, but after a little mindful practice our clients find it leads to better decision making, especially in their financial life.

Betsy:  What is driving the wave of social change that motivates people to integrate their values into all aspects of their life, including their finances, and how has it affected Highlander Wealth?

Sol:   We're in one of those periods now where everything has gotten so complicated and busy that people want their life to be integrated across all aspects. It’s their way of simplifying a couple of variables across the spectrum of all their daily experiences.  People are trying to break down the boundaries and compartments between various aspects of their life, which includes their finances in a big way.

At the same time, most companies providing services within the financial sector have not evolved. The advisory techniques that are used by most wealth advisors are the same as they were 10 and 20 years ago. People are no longer happy to have a financial life with no connection to the rest of what they're doing.  They want to see their values and their vision of the future reflected in every aspect of their life, and the financial aspect in particular, which creates a huge opportunity for practitioners like Highlander Wealth who are willing to rethink how financial services should be delivered.

Betsy: We read a lot about different generations and demographic groups leading this change. What are your observations of this change rippling through the financial services industry and among your clients?

Sol:  There's a big difference between generations. While the Baby Boomers have always been revolutionaries and change agents in some aspects of their lives, they are also used to a system of personal finance that was done the old way.  There’s a split in Boomer clients, because some are content with the way things have always been done and others are really yearning for change.

When you come to the millennials, they are really leading the charge in the mindful finance evolution. With colleagues at work and friends outside of work, they are trying to figure out how to completely integrate mental and emotional aspects of their life, including within a financial context.

I'd also point out that women in general, of all ages, are more engaged in this way of making decisions.  Women are more holistic decision makers and their empowerment over the past ten or fifteen years in investing and finances has helped the industry create more integrated approaches.

Betsy:   Can you speak a little more about how investing fits into that movement and how you help clients integrate those principles?

Sol : Historically, investing had one focus: How to make your money into more money. The traditional perspective focused solely on financial return on investment.  At Highlander, we have seen a continuously shifting investing approach desired by our clients.  Increasingly, investors are looking to incorporate their values into their investments, to vote their investment dollars with their values and express what’s important to them, which includes monetary gain.  It’s exciting to see the changes happening and to bring investing into this broader mindful movement reflected by the growth of sustainable and impact investing since those are often areas we see clients expressing values alignment.  Advisors who want to be where trends are headed need to increase their education to be at the forefront of sustainable and responsible investing.

We work with a lot of different types of investors on both publicly traded and private investments.  Often when we speak with clients about values, their vision of the future and their investments we hear very private thoughts and feelings.  And we have seen that private investments can be much more personal and directed for those clients higher up on the wealth spectrum.

But the real key to how we turn our philosophy of integrating values into investments is in publicly traded investments, since they usually form the bulk of a client’s portfolio.  With publicly traded vehicles, we can give access to high quality investments to clients of all shapes and sizes. Investing with your values shouldn’t be a service limited to the very wealthy.

Betsy : Even today, there’s a myth about there about sustainable or impact investment vehicles underperforming the broad market. Do you find that you have to sacrifice investment performance to achieve mindful finance or to create these custom-designed investment portfolios for your clients?

Sol: The answer is really simple: No. You don't have to sacrifice anything.  In fact, you end up gaining a lot. From a mindful finance perspective, the impact we're most concerned about is turning that lens inward and asking, “What is the impact on our client, on their state of mind, on all aspects of their life today and tomorrow?” When you ask that, the answer is more than simple investment returns. Clients talk about risk, personal concerns, values, hopes and other aspects of their lives. It’s hard for many people to start to articulate in this way, and it changes over time, but if you don't ask about and address these issues, I think you end up not serving your client's best interests.

Betsy : Boulder doesn’t seem like the most obvious place to run a wealth management practice, yet there is quite a hub of it here. Why is Highlander Wealth here in Boulder?

Sol :  My business partner and I were born and raised in Boulder. We have a connection here and that's a good starting place. Boulder is a great progressive, open minded, amazing community – well educated population and a beautiful place physically. Boulder has become a nexus of technology, education, research, natural and organic food and venture capital. Boulder has always been a community that's open to new ideas and a place where new ideas can sprout and so that's a good place for mindful finance to start as well.

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See Green Alpha's blog for more thought leadership pieces on sustainability and impact investing: http://hvst.co/2bl15S3