The National Financial Educators Council (NFEC) surveyed young adults in 2017 and asked them what high school level course would benefit their lives the most.
The majority responded that money management was the course that would be most beneficial.
With personal debt is at its highest record and COVID-19 threatening to have the hardest economic effects on youth, understanding money and finances is an important life lesson that should be taught to children at a young age.
The following is a list of the best financial literacy lessons and tips to teach children throughout different life stages.
Insurance bills suck.
They're so necessary, but when your premiums come due, it can almost feel like you're just throwing money down the drain.
And since you choose your own insurance, there's always the nagging feeling that maybe you chose the wrong one.
Is everyone paying this much for insurance?! Sometimes, yea: Americans are overpaying by the billions.
So we found a way to figure out if you're one of those Americans: Gabi.
It's an online portal that compiles all the rates from the major (and not-so-major!) auto and home insurance companies, so you can see if there's something out there more affordable than your current plan.
Here's everything you need to know about Gabi:
What exactly is Gabi?
It's like an online insurance marketplace. They work with more than 40 insurance companies in all 50 states to identify the lowest rate for you.
You answer some basic questions and upload your current insurance (it took us about 2 minutes) and then they'll email you a quote of what you should be paying and where you can land that rate. They also help you buy it. Gabi will always show you the lowest rate, and there's no obligation to switch.
Is it difficult?
Nope - it's ridiculously easy. Simply fill out the form, get a quote, and then they'll help you switch providers. Gabi walks you through the entire process, either online or over the phone.
What kind of information do I need to give them?
They ask for your current carrier and policy, along with basics like your address and social security number to double check that everything is correct.
Do they do all types of insurance?
Currently, they do home, auto, renters, umbrella, and landlord insurance.
Is it really free?
Yes! They don't make money off of you, they make money off of the insurance companies. So you get to reap the rewards.
...Is it legit?
Yep - they don't share or save any of your data. It's all super secure and there are so many incredible customer reviews. People like Gabi for how much they save, and how easy it is to switch carriers.
Okay, but will this really save me money?
They claim that on average, users save $825 a year, but some save less and some save way more.
Or, people discover that they're already on the cheapest plan! Honestly, that's amazing - that means you can rest easy knowing the grass isn't greener on the other side.
Insurance companies profit off you by making insurance seem really complicated so you don't look too deeply into your rates.
Gabi is trying to change this.
With full transparency, you'll see which company actually has the cheapest rates, and those who just advertise that they do. Try Gabi today and see how much you can save.
Sustainable living is more than just a buzzword these days; it has impacted our lives from the products we consume to the food we eat, helping us find balance in our lives, both physically and mentally.
So why not apply this concept to the way we invest our money as well? Enter—socially responsible investing.
Every dollar we spend gives us the ability to make a change in the world and as investors, we are at the forefront of creating a lasting impact. This can be done through Socially Responsible Investing (SRI) which gives us the ability to grow our money while investing in causes we care about.
What is Socially Responsible Investing?
Socially Responsible Investing is when investors consider environmental, social and governance (ESG) factors when choosing where to put their money. This means choosing businesses that are ethically sound and align with the core values of the investor. SRI also means avoiding industries that have a negative impact on the environment, such as alcohol, tobacco, fast food or fossil fuel production.
The most important ESG factors vary by investor. Some may care most about the size of a company's carbon footprint while others might prioritize fair treatment of employees and ethical practices in the workplace. SRI has become incredibly popular in recent years and The Bank of America estimates that there will be a $20 million flow in this type of investing over the next two decades.
Different ways to invest in SRIs
Socially responsible investing is entirely dependent on what the investor wants to support through his/her investment strategy—be it climate change or workplace equality. Hence, there is no one size fits all approach to this type of investing. Here are a few ways to invest more intentionally:
Mutual funds are known to be safe bets for many investors, and they are popular among socially responsible investors as well. There are more than 200 socially responsible mutual funds on the US SIF website for investors to choose from. You can find data on the financial performance of a stock along with information on how the company in question contributes towards a greater social impact.
SRI mutual funds focus on three main areas:
1. Environmental, Social and Governance funds—or ESG for short—are funds invested in industries that have adopted ethical practices. The company's material impact is taken into consideration along with its financial performance.
2. Impact funds—While ESG funds place equal importance on both impact and financial performance of a stock, Impact funds aim to put social impact first. These funds invest in companies that create societal change but may not offer the best financial return. They're good choices for investors who prioritize their social intentions over financial gain.
3. Faith funds—These funds invest in stocks of companies whose values are based on the Christian, Catholic or Islamic faith. Companies that don't fall under this category are excluded.
Socially Responsible Investing isn't just limited to mutual funds; other investment assets are getting into the SRI game as well. Alternative investment options for ethical investors include property funds and hedge funds which are said to be a $588 billion industry today. Investors who opt for this type of security have over 780 alternative investment funds to choose from.
Advantages of SRI funds
People who take the socially responsible investment approach usually tend to go all in. This means that their portfolios only include stocks of companies that are socially and ethically responsible. Here are the benefits of adopting such a strategy:
1. Stick to your values
All our actions and reactions are based on a core set of values that we follow. Socially responsible investing lets us apply this principle to our investment strategy as well. Investing intentionally through SRIs allows you to do more than just discuss social issues; you have the ability to use your money to take action for what you believe in.
2. Invest and let go
Most financial assets we invest in require micromanagement—either by us or a financial advisor. SRI funds, however, are designed to be low risk, allowing you (the investor) to adopt a hands-off approach. You can use your time to focus on riskier assets in your portfolio.
Disadvantages of SRI funds
While SRI funds may seem like a great addition to your portfolio, they do have drawbacks as well. These include:
1. Financial performance takes a backseat
Socially responsible investing allows you to invest in causes that you care about, but very often a strong focus on a company's ethical practices means that financial performance can take a backseat. Studies done on SRIs at different time periods showed that they underperformed in comparison to other stocks. Hence, when picking SRI stocks, it is important that you don't deviate from your financial goals.
2. A marketing gimmick
Although climate change and the carbon footprint are growing concerns, it is also important to remember that we live in a society where profits trump social ethics. Companies that claim to be ethical or socially responsible may be using corporate partnerships to improve their position in the market. In many cases, the illusion of social responsibility is simply a marketing gimmick to earn greater profits. The sad reality is that businesses who promote eco-friendly practices may be the perpetrators of an environmental scandal. A great example of this is when Volkswagen deliberately claimed they would design a system to reduce carbon emissions in order to gain an edge over their competitors; meanwhile, the company's production plant was actually poisoning the planet.
Is SRI the right fit for you?
Millennials and Gen Z are at the forefront of using socially responsible investing to create a lasting impact with their finances. This in no way means that SRIs are a fad that will eventually pass—in fact, they are here to stay. Between 2016 and 2018, the number of investments in SRIs grew by 38 percent. In the world of investing where making money has become the main goal, socially responsible investing allows you to earn an income while promoting change.
At the same time, this investment strategy may not be for everyone. In certain situations, investors should be willing to forgo extra income in favor of supporting a social cause. This trade-off is something that needs to be considered before investing with this approach. However, if you put in the time and effort, it is possible to find stocks that meet both your social and financial goals. Striking that perfect balance can help you feel secure, knowing that your finances are put towards a worthy cause!
- The State of Socially Responsible Investing ›
- What is Socially Responsible Investing (SRI)? ›
- Complete guide to ESG and socially responsible investing (SRI) ›
- 7 Great Socially Responsible Mutual Funds ›
- The Pros and Cons of Socially Responsible Investing - The Dough ... ›
- The Forum for Sustainable and Responsible Investment ›
- 7 of the Best Socially Responsible Funds | Funds | US News ›
- Socially responsible investing - Wikipedia ›
- Socially Responsible Investment (SRI) Definition ›
Back in 1997, you could buy a share of Amazon stock for around one dollar. Imagine if you bought one thousand of those shares and still owned them today (a share is currently around $2,100, almost a 120,000% increase)! The popularity of marijuana stock comes from the potentials of the industry–everyone's hoping to find a payoff much like early Amazon investors. With US marijuana sales expected to reach 23.4 billion by the year 2022, the market could possibly see exceptional trajectory growth in the stock market.
With recent changes to the legalization of marijuana use in the United States, both medically and recreationally, more people are showing an interest in marijuana stocks. And it's no wonder, considering global spending on legal cannabis worldwide is projected to hit 57 billion in a decade. The legal market is growing like a weed (pun intended) and many people are wondering if investing in marijuana right now could pay off in the future.
Marijuana derives from the cannabis plant, as does hemp. The plant produces cannabinoid chemicals like tetrahydrocannabinol (THC) and cannabidiol (CBD). There are plenty of different companies currently in the pot industry. Before making any decisions on investing in this industry, you should do your research first. When looking into companies dabbling in marijuana, it's important to know what they deal with. Some marijuana stock companies are in the growth and retail industry, such as Canopy Growth Corporation. Others are in the biotech and pharma industry, such as GW Pharmaceuticals, while others are focused on CBD products like Charlotte's Web. Many well-known companies are also looking to become players in the marijuana industry. Anheuser-Busch announced a $50 billion partnership in 2018 with Tilray to research the production of canned beverages that will contain both CBD and THC.
When buying stock in marijuana, you have options. You can buy publicly traded stock yourself through over-the-counter trades (OTC), from a stock exchange available through a licensed broker, or through an exchange-traded fund (ETF) which is a group of funds grouped together into one account. There are pros and cons to each of these buying options.
Choosing an ETF can reduce your risk, since your portfolio is diversified over many different stocks; but on the flip side, you're not as likely to reap any significant benefits if one of the stocks happens to soar. The two most popular weed-based ETFs are the
OTCs, sometimes called penny stocks, are the riskiest buying options simply due to the lack of public information on such new companies, combined with the fact that most of the companies in this stock line are new businesses. The appeal of these types of stocks, however, is their low cost to purchase. For example, cbdMD, a producer of CBD oils, had a stock price at $1.11 per share as of February 23rd. Even though these low stock prices are enticing, it probably would not be wise to put all of your eggs in one basket with any OTC stocks.
Just like any budding industry, the potential gain is great, but the risk could be even greater, and your investments might have the risk of going up in smoke.
Although recreational marijuana is now legal in 11 states and medical marijuana in 33 states, the drug is still illegal on federal terms under the Controlled Substance Act. With marijuana's classification as a Schedule 1 drug under this act, the federal government declares it to be completely illegal, even for medical use– which technically means that investors who put their money in marijuana companies are conspiring to violate that act. If you're an employee of the federal government, it might be best to steer clear of any marijuana stocks–at least until it's legalized on the federal level. For everyday investors, however, the chance of facing criminal charges is pretty low.
Price to Sales Risks
The price to sales ratio is commonly used amongst investors when evaluating stocks. A company's P/S ratio is determined by dividing a company's market capitalization by its revenue (usually over a twelve-month period). It's important to look into the PS ratio for any company you plan on buying stock in, as this figure gives you a better understanding of how much investors are willing to pay per dollar of sales. The key takeaway: the lower the ratio, the more desirable the stock is to purchase.
A look at this P/S ratio chart shows the significantly higher projected P/S ratio in the marijuana stocks compared to other industries. Currently, top-trending marijuana stocks from companies like Cronos Group, Inc., Tilray Inc., and Canopy Growth, Inc. are showing high results for P/S ratio. The good news: P/S ratio is not the be-all-end-all of determining a stock's worth.
Black Market Risks
As much as statistics show growth trends in the legalized sector of marijuana-based sales, black market pot sales are still playing a role in hindering the industry's sales. Even with the complete legalization of marijuana in Canada, for example, statistics still show that nearly half of all cannabis users report buying marijuana from illegal sources.Likewise, according to NBC News, in spite of California legalizing recreational marijuana over two years ago, black market sales still outnumber the legal ones.
Stock dilution occurs when a company issues new stocks, therefore decreasing ownership percentages of current stockholders, and in turn stock prices. Statistics show that many marijuana-related industries have dilution concerns, which can be seen through market cap statistics showing the share price and the number of existing shares. For example, Canopy Growth's five year market cap analysis chart shows a significant increase.
The Bottom Line
It seems that many of the repercussive risks in the legal marijuana industry will change over time, as more and more countries legalize and decriminalize marijuana. With the growing support of its legalization over time, I believe the legal market is here to stay.
Pew Research Center
It's impossible to invest in any stock without taking risks. The best advice for potential pot investors: Don't devote more than you are willing to risk, do your research before buying any particular stocks yourself, and always remember, diversification is key in any good investment strategy!