What Are the Best Ways for Christians to Invest Responsibly and Faithfully?

Ask Ralph: Should Christians Invest in the Stock Market?

Welcome back to “Ask Ralph,” your daily dose of Christian financial wisdom! Today, we tackle a question that's been on the minds of many believers: What Are the Best Ways for Christians to Invest Responsibly and Faithfully?

Check out the full podcast episode:

It's a topic that sparks debate, with some viewing the stock market as a risky gamble and others seeing it as a prudent way to grow wealth. As Christians, how do we navigate this complex world of investments and ensure our financial decisions align with our faith?

(1) Biblical Perspective on Investing and Wealth

The Bible doesn't explicitly address stock market investing, but it offers valuable principles to guide our financial decisions. Several verses emphasize the importance of wise stewardship, diligence, and seeking long-term growth rather than quick riches. Proverbs 13:11 states, "Wealth gained hastily will dwindle, but whoever gathers little by little will increase it." ¹ This reminds us that building wealth takes time and patience, not risky speculation. Furthermore, Proverbs 21:20 encourages us to be like the wise who save resources in times of plenty: "Precious treasure and oil are in a wise man's dwelling, but a foolish man devours it." ³ This reinforces the concept of stewardship and planning for the future.

Proverbs 13:22 adds another layer to this by suggesting that wise investments can even benefit future generations: "A good person leaves an inheritance for their children's children, but a sinner's wealth is stored up for the righteous." ⁴ This connects the concept of investing with the biblical principle of leaving an inheritance.

While these verses encourage wise financial planning, others caution against the love of money and the dangers of placing our trust in wealth instead of God. 1 Timothy 6:17-19 instructs those who are rich "not to be arrogant nor to put their hope in wealth, which is so uncertain, but to put their hope in God, who richly provides us with everything for our enjoyment." ¹ This reminds us to maintain a proper perspective on wealth, recognizing that our ultimate dependence should be on God, not our possessions.

While the Bible provides these general principles, Christian leaders offer more specific guidance on navigating the stock market.

(2) Christian Leaders on Stock Market Investing

Christian leaders offer diverse perspectives on stock market investing. Some express concerns about the potential for greed and materialism associated with the stock market⁵. They emphasize the importance of prioritizing generosity, contentment, and investing in eternal treasures rather than worldly possessions⁶. They also warn against unethical investment practices that contradict Christian values, such as insider trading, which involves using non-public information for personal gain⁷.

Others suggest that investing can be a responsible way to manage God's resources and provide for our families and future needs⁸. They encourage Christians to approach investing with wisdom, discernment, and a long-term perspective, avoiding speculative ventures and seeking to honor God with their financial decisions.

(3) Historical Examples of Christian Investors

The concept of investing in companies for financial gain has a long history, dating back centuries. Early examples include the British and Dutch East India Companies, established in the 17th century. These were among the first joint-stock companies, where investors pooled their resources to fund ventures and share in the profits⁹.

More recently, in the 18th century, John Wesley cautioned against investing in companies involved in alcohol and tobacco production¹⁰. This demonstrates an early awareness among Christians of the need to align investments with their values. In the 1970s, the Episcopal Church played a significant role in the rise of "values investing" by challenging General Motors' policies in apartheid South Africa¹⁰. This further highlights the historical efforts of Christians to use their financial influence to promote ethical behavior and social justice.

(4) Aligning Investments with Christian Values

Christian financial advisors generally agree that the Bible doesn't prohibit stock market investing. They often cite the Parable of the Talents (Matthew 25:14-30) as an example of how God expects us to be good stewards of the resources He has entrusted to us¹¹. But how can we practically apply these principles when choosing investments?

One important consideration is aligning investments with Christian values. This may involve avoiding companies that engage in activities that contradict biblical principles, such as abortion, pornography, or gambling¹². It also encourages investors to consider the social and environmental impact of their investments, seeking companies that demonstrate ethical behavior and responsible stewardship¹³. It's important to remember that all investments carry some level of risk, even those presented as low-risk, so careful research and discernment are essential¹¹.

For those seeking to align their investments with their faith, there are various ethical investment funds and strategies available. These funds typically screen out companies involved in activities that conflict with Christian principles and may prioritize companies that demonstrate positive social and environmental impact¹⁵.

Some prominent faith-based investment funds include:

In addition to choosing ethical funds, Christian investors can also employ strategies such as:

• Biblically Responsible Investing (BRI): Focuses on avoiding investments in companies that promote or profit from activities considered sinful¹⁹.
• Thematic Investing: Investing in companies that address specific social or environmental challenges, such as poverty, clean water access, or healthcare²¹.
• Impact Investing: Seeking investments that generate positive social or environmental impact alongside financial returns²².

(5) Risks and Rewards of Stock Market Investing

It's crucial to understand the potential risks and rewards of stock market investing. While stocks have historically offered higher returns than other asset classes, they also come with greater volatility and the possibility of losing money²³.

Some of the risks associated with stock market investing include:

• Market Risk: The risk that stock prices may decline due to factors such as economic downturns, political events, or changes in investor sentiment²⁵.
• Economic Risk: The risk that macroeconomic factors, such as recessions or inflation, may negatively impact investment returns²⁶.
• Company-Specific Risk: The risk that events within a particular company, such as poor management or product failures, may lead to a decline in its stock price²⁵.

On the other hand, potential rewards of stock market investing include:

• Capital Gains: The potential for profits from selling stocks that have increased in value²⁷.
• Dividends: Payments made by companies to their shareholders, providing a stream of income²⁷.
• Retirement Planning: The potential for long-term growth to help build a secure retirement²⁷.
• Financial Freedom: The possibility of achieving financial goals and greater independence²⁷.

(6) Conclusion: Seeking Wisdom and Stewardship

So, should Christians invest in the stock market? The answer, like many things in life, is nuanced. It depends on individual circumstances, risk tolerance, and financial goals. We've seen that the Bible offers guiding principles for financial decisions, emphasizing stewardship, diligence, and contentment. Christian leaders and financial advisors provide further insights, highlighting the importance of aligning investments with our values and seeking long-term growth while acknowledging the inherent risks involved.

Ultimately, the decision of whether or not to invest in the stock market is a personal one that requires careful consideration of individual circumstances, risk tolerance, and a commitment to seeking God's guidance. It's essential to remember that every action and attitude is an investment that reaps dividends, either for good or bad²⁹. Therefore, we must strive to align all aspects of our lives, including our financial decisions, with our Christian values.

Some key takeaways for Christian investors include:

• Prioritize prayer and seeking God's guidance in all financial decisions.
• Be a faithful steward of the resources God has entrusted to you.
• Seek wise counsel from trusted Christian financial advisors.
• Align your investments with your values and biblical principles.
• Consider the potential risks and rewards before making investment decisions.
• Avoid the love of money and the pursuit of quick riches.
• Remember that true security comes from God, not our financial possessions.

By approaching investing with wisdom, discernment, and a heart of stewardship, Christians can use their financial resources to honor God, provide for their families, and make a positive impact on the world.

Works cited

1. Five of the Best Bible Verses About Investing - PAX Financial Group, accessed January 2, 2025, https://paxfinancialgroup.com/financial-planning/five-of-the-best-bible-verses-about-investing/
2. What Does The Bible Say About Wealth and Investing?, accessed January 2, 2025, https://www.demandwealth.com/what-does-the-bible-say-about-wealth/
3. Spotlight on Scripture: 25 Helpful Bible Verses on Investing - Intrepid Eagle Finance, accessed January 2, 2025, https://intrepideaglefinance.com/blog/bible-verses-on-investing
4. 18 Bible Verses About Wealth and Prosperity - Kenneth Copeland Ministries, accessed January 2, 2025, https://www.kcm.org/real-help/finances/apply/18-bible-verses-about-wealth-and-prosperity?language_content_entity=en-US
5. Should Christians Invest in the Stock Market? - Guest Commentary - Crosswalk.com, accessed January 2, 2025, https://www.crosswalk.com/headlines/contributors/guest-commentary/should-christians-invest-in-the-stock-market.html
6. Is Investing in Stocks Any Better Than Gambling? | Desiring God, accessed January 2, 2025, https://www.desiringgod.org/interviews/is-investing-in-stocks-any-better-than-gambling
7. My Christian Views on Stocks & Trading - Pneumatikos, accessed January 2, 2025, https://www.pneumatikos.co.uk/post/my-christian-views-on-stocks
8. Should a Christian invest money in the stock market? | GotQuestions.org, accessed January 2, 2025, https://www.gotquestions.org/Christian-stock-market.html
9. History of Faith-Based Investing With Jason Myhre - FaithFi, accessed January 2, 2025, https://www.faithfi.com/moneywise/history-of-faith-based-investing-with-jason-myhre-2412
10. Treasures in Heaven, Portfolios on Earth - Christianity Today, accessed January 2, 2025, https://www.christianitytoday.com/2022/08/money-finances-asset-management-treasures-heaven-portfolios/
11. Should Christians Invest? - Grace Financial Advisors, accessed January 2, 2025, https://gracefinancialadvisors.com/blog/should-christians-invest
12. 3 Principles for Christian Investing - The Life Financial Group, Inc., accessed January 2, 2025, https://www.thelifegroup.org/3-principles-for-christian-investing/
13. Investing And A Biblical Worldview - Denver Institute For Faith & Work, accessed January 2, 2025, https://www.denverinstitute.org/investing-and-a-biblical-worldview/
14. Faith Based Investing | Christian Financial Advisors®, accessed January 2, 2025, https://christianfinancialadvisors.com/services/faith-based-investing/
15. A Guide to Faith-Based Investing - Investopedia, accessed January 2, 2025, https://www.investopedia.com/articles/stocks/12/investing-and-faith.asp
16. Mutual Funds and ETFs — Faith Driven Investor, accessed January 2, 2025, https://www.faithdriveninvestor.org/mutual-funds
17. Biblically Responsible Investing for Over 25 Years | Timothy Plan®, accessed January 2, 2025, https://timothyplan.com/
18. Values Based Mutual Funds | Christian Financial Advisors, accessed January 2, 2025, https://christianfinancialadvisors.com/christian-mutual-funds/
19. Biblical Responsible Investing - G.A. Repple, accessed January 2, 2025, https://www.garepple.com/biblical-responsible-investing/
20. What Is Biblically Responsible Investing - Envoy Financial, accessed January 2, 2025, https://www.envoyfinancial.com/what-is-biblically-responsible-investing/
21. Aligning Christian Values with Investing - Jeremy McDade | Morgan Stanley, accessed January 2, 2025, https://advisor.morganstanley.com/jeremy.mcdade/articles/philanthrophy/faith-based-investing-christian-values
22. A Matter of Faith | Morningstar, accessed January 2, 2025, https://www.morningstar.com/sustainable-investing/matter-faith
23. Risk and return | Investor.gov, accessed January 2, 2025, https://www.investor.gov/additional-resources/information/youth/teachers-classroom-resources/risk-and-return
24. Benefits of Holding Stocks for the Long Term - Investopedia, accessed January 2, 2025, https://www.investopedia.com/articles/investing/052216/4-benefits-holding-stocks-long-term.asp
25. Market Risk Definition: How to Deal with Systematic Risk - Investopedia, accessed January 2, 2025, https://www.investopedia.com/terms/m/marketrisk.asp
26. Risks of Investing in Stocks and How to Avoid Them - SmartAsset, accessed January 2, 2025, https://smartasset.com/investing/risks-of-investing-in-stocks
27. A Guide To Understanding the Risks and Rewards of Stock Investing, accessed January 2, 2025, https://infinityinvesting.com/a-guide-to-understanding-the-risks-and-rewards-of-stock-investing/
28. The Basics of Investing In Stocks - Washington State Department of Financial Institutions, accessed January 2, 2025, https://dfi.wa.gov/financial-education/information/basics-investing-stocks
29. Hannah: A Wise Investor - Sermons and Outlines, accessed January 2, 2025, https://www.sermonnotebook.org/old%20testament/1%20Samuel%201_1-28.htm