Why Should I Consider an Ethical Investment ISA?
Lots of people opt for an Ethical ISA to “put their money where their mouth is”, because it allows you to invest in line with specific values you might hold. If you do hold strong beliefs on specific issues – for example, the environment – then you should consider opening an Ethical ISA. So what exactly is an Ethical ISA, and how do they work? We’ve broken it down for you.
What is An Ethical Investment ISA?
An Ethical ISA is a type of ISA which allows you to simultaneously invest your money in funds which align with your own personal values whilst enjoying the tax-free return benefits associated with an ISA account.
The accounts will only invest in funds which are socially responsible – i.e. they will exclude investment funds which are associated with certain investment opportunities or industries.
How are they “Ethical”?
Ethical Investment ISAs are accounts which specifically invest your money in socially responsible stocks and shares.
Depending on the provider you choose for your Ethical Investment ISA, the following industries will generally be excluded from investment opportunities:
- Tobacco
- Alcohol
- Pornography
- Gambling
- Fur trade
- Armaments
- Oil companies
- Mining companies
- Fire arms manufacturers
Why should I Consider an Ethical ISA?
You should consider an Ethical ISA if you are looking to ensure that your investments are aligned with your personal values.
Other Ethical investment options are available, however by using your ISA allowance you will be able to enjoy your returns being kept safe from the tax man.
As with most other types of ISAs, you can invest up to £20,000 per year into an Ethical Investment ISA without having to pay income tax or capital gains tax on the returns from those investments.
So if you’re a bit more conscious of the social impact of your investments, this is a great way to make sure you are comfortable with where your money is going while still making good returns and taking advantage of your ISA allowance.
Where should I look for one?
Lots of different providers offer an Ethical ISA option - so it's important to shop around to make sure you know where you're putting your money, and to make sure you're getting the best deal which works for you.
Our Ethical Investment ISA page compares all the latest rates and look at all the options available to you.