Most of you know I am involved with KIVA. Andrew Corn over at Clear Asset Management has a wonderful group he is involved with. Please read and invest.
It is the season. The season of holidays and the season of requests. Mine is a request to invest. Invest in people and receive a return beyond dollars and cents. Below is my blog post from this morning. I hope you consider joining me and my family and the thousands of others trying to change and repair a small piece of the world.
Earn Two Percent and Change the World
It is that time of year, the holidays. The old movies are on TV and one of my favorites is It’s a Wonderful Life. A key take-away of the movie is that everyone is connected. Our actions can have an impact on a global basis.
That same powerful, enabling concept can hold true in investing.
Now let’s move to US foreign policy. There is a hypothesis in some circles that our vast aid sometimes breeds resentment. The richest country in the world is providing a handout. Many people are proud and resent handouts. The old Chinese proverb goes: “give a person a fish, feed them for a day, teach a person to fish and feed them for a lifetime.” This philosophy of investing in individuals’ ability to make their own living can translate as follows:
The Investment Thesis
* Touch over 100 lives with a minimal investment of $1,000 (a three year lockup)
* Loan people the tiny amount they need to buy “a fishing pole;” we are not “teaching anyone to fish”
* Earn 2% in the process
The essence of my investment thesis combines interest income with touching over 100 lives over three years, empowering them to help themselves through an entrepreneurial endeavor. The concept of MicroBanking is not new. Unfortunately it has been perverted by some large banks. My family has had the privilege to meet and work with a not for profit organization. They charge the lowest amount of interest possible as a microleander and pay interest back to their investors.
The Bank was founded in 1975 by the World Council of Churches and is the largest, most far reaching organization of its kind. The loans have no religious overtone. This is only about non-profit microbanking, not about converting the masses. I believe in this so strongly that I have started a personal web site to assist them at www.InvestingBack.com which is chock full of information.
How to Get Started
I recommend you invest your hard earned money to help people earn their way out of a life of poverty. They accomplish this by borrowing small amounts of money and paying it back. The default rate is lower than credit card defaults in the US. Every investor has received their principal investment back along with interest.
Invest a minimum of $1,000 for three years and earn a two percent interest rate. This is not a donation! It is an investment.
The money will be loaned, mostly to women, who will use this money ($100 borrowed on average) to devise a way to make an honest living, feed and clothe their family and provide basic healthcare.
I believe giving someone money because he or she is poor is not helping them as much as lending them money to create a business, get on their feet and keep earning money. I am investing in people helping themselves.
It truly is a wonderful life!
Your money is invested in the loan pool of the Micro Bank which invests it over and over again, helping many people. You are NOT placing one cent into administration or fund raising. Your investment touches many people (remember the movie scenario) helping individuals, families and touching whole communities. Yes, each investment into the loan portfolio makes a material difference!
The promise I made to my family, who are all in on this, is not to stop talking, writing and cajoling people about micro banking until at least 99 additional families have invested alongside us. For those that know me well, the whisper number is 999. Together we can help a lot of families and repair a small piece of the world.
The bottom Line
Too many funds are down for the year. A daily liquid savings account pays near zero. How many money markets are invested in level three junk bonds and are in trouble? Through this investment, you know who the lender is, where the money is going and all of the stats are a few links away.
I suggest investing more than the minimum and doing it with your family this weekend.
Make money and make a difference.
Donate to the ValuePlays Project for KIVA