Book Review: Low Fee Socially Responsible Investing – Investing in your worldview on your terms

Today I’m reviewing a book written by a friend and colleague, Tom Nowak, CFP®.  Tom is passionate about Socially Responsible Investing (SRI) and he has written a great overview of the concept.  He introduces some very good tools that the average investor can use, either on your own or to help guide conversations with your advisor.

But SRI concepts are available in many forms from many sources – what makes Tom’s book unique is that he develops a framework that allows the individual investor to implement SRI strategies (or for that matter, any investment strategy reflecting a particular worldview) in a very cost-effective manner.

Mr. Nowak starts out with a discussion of fees and how they can have a major impact on your overall investment returns.  As you may already know, any reduction that you can achieve on the fees that your investment activities cost you will be returned directly to your bottom line.  Tom outlines the options that you can use for investing, pointing out the pros and cons of each alternative.  Certain alternatives are more cost effective at various asset levels – and these alternatives are discussed and reviewed at length.

Next, the author outlines his recommended approach for the Ultra-Low Fee SRI portfolio.  Interestingly, as Tom points out, this sort of approach could be used for literally any worldview, including SRI in its many forms as well as, for example, whatever you might call the exact opposite of socially-responsible (socially irresponsible? sin-oriented? college fraternity house oriented?).

Tom then follows up with a chapter with Q&A on the approach, which provides excellent insights to help you implement such a strategy.  After that chapter is a chapter for your advisor to review as you look to implement your strategy.  Advisors can learn quite a lot from reading what Mr. Nowak has to say – I’ve found his insights quite valuable over the years, and the chapter presents his insight very well.

All in all, I think this is a great book for any investor to read – regardless of whether or not you are looking to implement an SRI investing approach.  Advisors have a lot to learn from Tom’s approach as well, for helping your clients to implement investment approaches that reflect the client’s particular worldview.  Tom does a wonderful job of explaining how to implement very low-cost investment strategies using readily-available tools and investment products.

Tom’s passion for the subject shows through in the book – do yourself a favor and spend some time learning about Tom and his excellent ideas.