Prosperity for "Cultural Creatives"
By Peter Cole, LCSW, ChFC
"Cultural Creatives" are people who care intensely about the environment and our role in it. We care about relationships and spiritual development. We tend to look for cooperative solutions to problems. We would prefer to cooperate with others than to compete with them. We would be willing to pay more in taxes if those taxes were to help improve the human and natural environment. We care about our psychological development. We care about social justice.
It is really no wonder that Cultural Creatives can feel alienated from the world of money and investing as it is portrayed in the media. The financial media tends to put its emphasis on finding hot stock tips and consumerism, valuing competition over cooperation, and valuing profit over social responsibility.
However, there is a natural home for Cultural Creatives who want to succeed with their investments. The values that Cultural Creatives hold are actually ideal for successful investing based on a powerful model known as Modern Portfolio Theory. Nobel prize winning economist Harry Markowitz is the originator of Modern Portfolio Theory. Modern Portfolio Theory looks at the market as a whole rather than focusing on individual stocks. Individual investments are analyzed statistically, looking at their long-term return rate and their short-term volatility. More volatile stocks are equated with risk. The goal is to identify your acceptable level of risk tolerance, and then to find a portfolio that matches that level of risk.
The beauty of this approach for Cultural Creatives, is that it gives us a way to invest in which investing is not seen as a competitive struggle. By finding your risk tolerance at any given stage of your life, and assigning an appropriate asset allocation for your investments, you have now greatly simplified the whole process of investing. Now you can turn your attention to the things that you really care about: your family, your work, your passions.
Cultural Creatives have an investing advantage: we are interested in our own psychological development. The Modern Portfolio Theory approach allows us to focus on our own wealth building behavior rather than on the competitive marketplace. We turn the focus to our own values and goals, working to align our present behavior with the outcomes we envision for our lives. Now, wealth building becomes a centering exercise – an aspect of our lives where we become aware of what we want and need, and invest according to our vision of our own lives.
We publish a new True Self True Wealth Connection every six weeks or so. Please send us your financial questions and issues so that we can know tailor our content to your concerns at topics@trueselftruewealth.com . We will choose topics of general interest to address in upcoming issues.