Latest news with #retirementinvestment
Forbes
14 hours ago
- Business
- Forbes
Should You Add Fossil Fuels To Your Retirement Investment Portfolio?
Potential alternatives to having fossil fuel producers in your retirement investment portfolio Many investors believe that fossil fuels are essential for strong retirement investment returns. But is that actually true? In this article, we test that assumption—comparing the performance of portfolios with and without fossil fuel exposure. While we focus mainly on investment performance (also known as risk-adjusted return), we also explore considerations for those who care about aligning their portfolio with environmental values. We'll break down investment performance, explore fossil fuel-free indexes, and offer practical steps for values-minded investors. Whether you're saving through a Roth IRA, Roth 401(k), or taxable account, it's worth understanding your options. Retirement Investment: Discerning Fossil Fuels Role In Investing When people talk about investment selection, they often mention two styles of investing: passive and active. Passive investors believe markets are efficient enough that trying to 'beat the market' is a losing game. Instead, they invest in index funds that aim to match the performance of a broad market benchmark, such as the Standard and Poors (S&P) 500 or the MSCI All Country World Index (ACWI), while keeping fees low. But passive investing still involves making asset allocation choices—specifically, choosing which mutual index to track and finding a mutual fund or exchange traded fund that tracks that index. For example, the S&P 500 selects the largest 500 US companies. The MSCI All Country World Index (MSCI ACWI) captures Large and Mid-cap representation across 23 Developed Markets (DM) and 24 Emerging Markets (EM) countries. With 2,559 constituents, the index covers approximately 85% of the global investable equity opportunity set. If you're like many retirement savers, you may already be invested passively through a Vanguard Target Retirement Fund in your 401(k). While these are passive by design, the mix of index funds they include is determined by a portfolio manager. Once the allocation is set, the fund simply tracks its chosen indexes—regardless of what industries (fossil fuels or otherwise) those indexes contain. The following index funds represent the Vanguard Target Retirement 2050 Series portfolio: By contrast, active investing means trying to beat the market by choosing specific stocks, sectors, or timing. This might include increasing investments in fossil fuel stocks or technology stocks that vary from the index benchmark. Active investing involves choosing individual stocks or sectors—like fossil fuels—with the hope of outperforming a market index. But what if there was a way to invest in the same index, minus the fossil fuels? Retirement Investment and a Fossil Fuel-Free Index The MSCI ACWI is a common benchmark used in diversified global portfolios. MSCI also offers a fossil fuel-free version, called the MSCI ACWI ex Fossil Fuels Index. This index removes companies that own fossil fuel reserves or are involved in oil, coal, or gas production. According to MSCI's fact sheet, the fossil fuel-free version has consistently delivered similar or better performance over many periods. In fact, it has often done so with slightly less risk. As always, past performance isn't a guarantee of future results. But today's data offers something important: you don't have to sacrifice returns to align your investments with your values. Unfortunately, you cannot directly invest in an index. You will have to find investments that track the index or seeks to benchmark against it to invest in. A couple options will be included later. MSCI ACWI vs MSCI ACWI ex Fossil Fuels Comparison Let's put some dollars against the numbers in the fact sheet. Here are some detailed comparisons for two investors—one in the MSCI ACWI and the other in the MSCI ACWI ex Fossil Fuels index—across two investment strategies. Here are the visual comparisons: Lump Sum Investment ($100,000 at Start) Year MSCI ACWI MSCI ACWI ex Fossil Fuels 0 $100,000 $100,000 1 $113,650 $114,720 3 $141,625 $143,449 5 $187,280 $185,880 10 $242,222 $248,049Systematic Investment ($10,000 annually for 10 years) Year MSCI ACWI MSCI ACWI ex Fossil Fuels 0 $0 $0 1 $10,000 $10,000 3 $33,841 $33,997 5 $65,280 $65,060 10 $153,754 $155,677 As you can see from the data, either from a lump sum or systematic investing perspective, the fossil fuel free index wins over a historical 10 year period. Ways to Incorporate Fossil Fuel-Free in Your Retirement Investments If you want to invest in a fossil fuel-free global portfolio, you don't need to be a stock picker or hire a hedge fund manager. You can invest through low-cost ETFs that track these indexes. Sphere The Sphere 500 Fossil-Free Index tracks the Top 500 US companies by market capitalization minus 93 fossil fuel and related companies: The independent non-profit As You Sow creates the list of fossil fuel and other companies that are excluded. Green Century Green Century is a mutual fund manager that provides several fossil fuel free mutual funds. Two are index fund based and the other actively managed. The Green Century Equity Fund seeks to achieve its objective by investing in the stocks of the companies that make up the MSCI KLD 400 Social ex Fossil Fuels Index, a custom index calculated by MSCI, Inc. The International Index Fund tracks the MSCI World ex USA SRI ex Fossil Fuels Index. This Index is composed of the common stocks of the approximately 240 companies in the MSCI World ex USA SRI Index that is then customized for Green Century to eliminate the stocks of companies that explore for, process, refine or distribute coal, oil, or gas, or produce or transmit electricity derived from fossil fuels, or have carbon reserves. The Balanced Fund is an actively managed fund comprised of equities and fixed-income securities. It typically holds 60% to 70% of its net assets in multi-cap stocks and 30% to 40% in investment-grade quality bonds. The Balanced Fund was an early investor in green bonds and now has more than 74% of its fixed-income portfolio in green and sustainable bonds.[1] As You Sow's Fossil Fuel Free Funds Research As You Sow provides a publicly available Fossil Fuel Funds Free research tool. You will find that it's methodology and evaluation may vary from the other providers discussed earlier. There research highlights that some mutual fund companies may score high that don't scream like they are fossil fuel free. For example, the Amana Growth Fund doesn't have Green in its name but gets an A grade. All of the funds listed in this article do not constitute an investment recommendation. I am providing these as examples to encourage you to do your own research or find an investment advisor that is knowledgeable in this area. There are even professional tools that go beyond what I've shown. Final Thoughts on Fossil Fuel Free Retirement Investments For years, the narrative was that investing according to your values—such as avoiding fossil fuels—meant settling for lower returns. But that argument is no longer supported by the data presented today. So, if you're wondering whether fossil fuels deserve a place in your portfolio, should focus on your goals, your values, and what you believe about the future of energy and the economy. This article shows that fossil fuel-free retirement investments don't automatically mean sacrificing return. Related Reading: Evaluating Risk-Adjusted Returns: The Key To Smarter Investing Social Values-Adjusted Investment Returns: Balancing Profit & Purpose
Daily Mail
28-05-2025
- Business
- Daily Mail
EXCLUSIVE Attack of the megasheds: The homeowner who has lost more than half a million pounds as 1.17million sq ft warehouse for The Range ruins views of rolling farmland
A horrified grandfather says £600,000 has been wiped off the value of his home and rental properties after a massive warehouse used by The Range sprung up beside his land. Ken Lungley enjoyed spectacular views over Suffolk countryside until work began on the 1.17 million sq ft 'megashed'. Now the sprawling building used by the variety store and garden centre retailer 'blights' the area and has caused the value of his retirement investment to collapse from £1.5 million to just £900,000. In a further blow, the local council has approved an even bigger warehouse beside the commercial site, which Mr Lungley, 79, fears will further slash what his nest egg is worth. He is powerless to do anything about it and told the Mail: 'You can't stand in the way of progress - but not in my back garden. 'It was all nature. Now all I can see is the warehouse roof and a big sign that says 'The Range'.' Divorcee Mr Lungley bought an acre of land with five barns in Creeting St Peter, near Stowmarket, in 1990 for £65,000 and converted four of them. One became his four-bedroom home and another is now a four-bedroom holiday home which he rents out for £1,500 for three nights or £2,000 for a week. The third structure houses a 28x14ft swimming pool that can be rented for £40 an hour and there is also a long-term rental property which brings in £1,150 per month. The businessman, a father-of-two who ran a scaffolding company in London for 50 years, has sunk around £500,000 into the site over the years and intends passing it on to his family one day. But the idyllic setting was changed forever when approval was given for the warehouse after a local farmer applied for permission. 'I have it valued every now and then because estate agents are always offering free valuations,' said Mr Lungley, who lives in his home with his two dogs. 'It went up and up and up [in value] and three years ago I had it valued and it was worth £1.5 million. Then when this building went up, I had it valued again and it was £1.2 million. 'Now it's gone down again. According to Zoopla it's worth £900,000. If they had built houses on it, it wouldn't be so bad on the eye. 'There are six or seven families in a little group here who complained about it [when the planning request was submitted] but that didn't get anywhere. 'I suppose it's a god send that it's only one warehouse, not ten or 11 little ones which we could have got. The Range's warehouse is part of Gateway 14 Ltd, a wholly-owned subsidiary of Mid Suffolk Council, which has permission for 2.36 million square-foot of floor space and is part of Freeport East, a set of low-tax, low-regulation zones given the green light in December 2021. 'But another one is going to go up on the other side of a road that runs through the site and it's even bigger. That's lots of warehouses and I think it's 156 acres. 'It used to be farmland. Certainly it's sad to have lost that view because there were deer and hares and everything over there. 'I could look into legal action about blight but I can't get the money.' Noise pollution hadn't been an issue, he added, but lights were left on all night at the car park until he spoke to the council and enforcement officers were called in. The land the warehouse is situated on was sold by a farmer and planning permission for a business park was granted in August 2021. It is run by Gateway 14 Ltd, a wholly-owned subsidiary of Mid Suffolk Council has permission for 2.36 million square-foot of floor space and is part of Freeport East, a set of low-tax, low-regulation zones given the green light in December 2021. The Range secured its plot in June 2022 and planning approval for the warehouse was granted in October that year - despite objectors including Creeting St Peter Parish Council. Parish councillors cited problems including traffic generation, lack of landscape details, noise problems and uncertainty over whether enough parking spaces are included in the plans. The Range moved into the 'mega-shed' in November 2023. In May last year, Mid Suffolk Council granted permission to add to the plot, which is the largest business park in East Anglia. The council and The Range were contacted for comments. In April, neighbours living in the 'warehouse capital of Britain' spoke of the nightmare of being forced to live in the shadow of massive buildings that they said is like being next to the 'Berlin Wall'. Northamptonshire has more storage and distribution centres than anywhere else in the country, with massive developments 'constantly' popping up. But homeowners in Corby had enough and said their lives have been ruined by the huge warehouses towering over their homes. They compared it to living next to the 'Berlin Wall' or in a 'prison camp'. Recruitment firm boss Georgie Wallis, 30, said: 'They have hit us with these legal bills despite a judge admitting the council were in the wrong' The town is home to dozens of industrial units including Europa's HQ and Nike's logistics campus, which is currently under construction. One 60ft high 'monster' warehouse - called Rockingham 161 - was even built without locals' knowledge due to a council error. The site of the former Weetabix plant still lies empty a year after being constructed, but looms over nearby homes in Hooke Close. Embarrassingly, council workers mistakenly consulted people living on the wrong road to ask for their thoughts on the enormous development. It was only when residents contacted the council to ask why they hadn't been informed that they found officials had mixed up the street with one half a mile away. Locals who opposed to the warehouse were recently refused a judicial review and even slapped with a £5,000 legal bill. This was despite a judge saying the council had 'fallen well below the standard expected' by failing to consult residents properly. Recruitment firm boss Georgie Wallis, 30, said: 'They have hit us with these legal bills despite a judge admitting the council were in the wrong. Mr Cruz said: 'We feel like we're living by the Berlin Wall, that's the most accurate way to describe it, and I don't even think the Berlin Wall was as big as this' 'It was because we didn't submit it on time, so on a technicality, really, I'm just exhausted with it all, but we will keep fighting. 'We have got to pay up this money while this giant eyesore lies empty - who knows what life will be like once people are in there with the pollution and traffic. 'I look out of my garden and all I can see is this big, grey and black daunting building which looms over our home.' Portuguese-born Jose Cruz, 65, and his wife Olga, 60, moved into their two-bedroom semi-detached home in 2011. He says they live constantly in a shadow and that the building blocks about 80 per cent of the sunlight into his home. Mr Cruz went on: said: 'Nobody wanted the warehouse here and nobody even consulted us about it, it has been a crazy situation from day one. 'We feel like we're living by the Berlin Wall, that's the most accurate way to describe it, and I don't even think the Berlin Wall was as big as this. 'I have lived in four different countries and I have never known anything like this. He says they live constantly in a shadow and that the building blocks about 80 per cent of the sunlight into his home 'The UK is not short of space - why erect these warehouses in between people's homes? It's just unbelievable. 'I'm afraid to have an estate agent round as who knows how much money has been wiped off the value of our property. 'It's terrible and we're very angry we weren't consulted about it. 'I just don't understand this country. The people here are the most wonderful but the one per cent making these decisions, I just do not get.' Council officers mistakenly consulted people living on Hubble Road instead of Hooke Close to ask their opinions about the massive 160,800 sq ft development. Another resident, who did not want to be named, said it felt like they were now living by 'a prison camp'. She added: 'It has just been horrifying, we have been left with this monstrous eyesore towering above us. 'They have planted some little trees but that's not going to make a difference. We feel like we're living by a prison camp. 'They are constantly being built in other areas too - the town is becoming a gigantic industrial estate. It's a daily nightmare.' Near to Magma Park where Europa's HQ and the Nike campus will be built, residents were also critical of the developments. One local, who did not want to be named, added: 'They are throwing up all these giant warehouses and loads of them just lie empty. 'You hear about redundancies being made instead, so who is going to fill them all? 'They are in the wrong place and I'm not sure they are even needed - it feels like there's more warehouses than residential areas.' Clare Bottle, chief executive of the UK Warehousing Association, said they were an 'important engine of growth in our supply chains.' She said: 'As supply chains become longer and face uncertainty due to world events, consumers and businesses alike are increasingly relying on warehouses to store and distribute the goods we need. 'Furthermore, activities which used to take place on the high street and in factories are being shifted into warehouse facilities, along with the processing of returns, recycling and even product repairs, which all underpin the circular economy.' A spokesperson for North Northamptonshire Council said at the time: 'Following the court's decision to refuse the claimant's application for judicial review on this case, the claimant then appealed the decision, and this appeal was then refused by the court in late March 2024. 'Due to the ongoing legal conversations around costs, it's not possible to comment any further at this stage.' However, for those thinking this can't get any worse, a real estate expert warned the UK will need around 2,000 football pitches worth of extra warehouse space in order to meet house-building targets and the growth of online retail, the BBC reports. Will Laing, a research analyst at Newmark Group, said: 'Given the government's target to build 1.5 million homes in the next five years, coupled with the continued shift to online retail, we estimate 150,000,000 sq ft (13,935,456 sq m) of extra warehousing will be needed over the next 10 years.'
Daily Mail
27-05-2025
- Business
- Daily Mail
EXCLUSIVE Grandfather sees £600,000 knocked off the value of his home and holiday let after The Range build huge 1.17million sq ft mega-shed next door
A horrified grandfather says £600,000 has been wiped off the value of his home and rental properties after a massive warehouse used by The Range sprung up beside his land. Ken Lungley enjoyed spectacular views over Suffolk countryside until work began on the 1.17 million sq ft 'megashed'. Now the sprawling building used by the variety store and garden centre retailer 'blights' the area and has caused the value of his retirement investment to collapse from £1.5 million to just £900,000. In a further blow, the local council has approved an even bigger warehouse beside the commercial site, which Mr Lungley, 79, fears will further slash what his nest egg is worth. He is powerless to do anything about it and told the Mail: 'You can't stand in the way of progress - but not in my back garden. 'It was all nature. Now all I can see is the warehouse roof and a big sign that says "The Range".' Divorcee Mr Lungley bought an acre of land with five barns in Creeting St Peter, near Stowmarket, in 1990 for £65,000 and converted four of them. One became his four-bedroom home and another is now a four-bedroom holiday home which he rents out for £1,500 for three nights or £2,000 for a week. The third structure houses a 28x14ft swimming pool that can be rented for £40 an hour and there is also a long-term rental property which brings in £1,150 per month. The businessman, a father-of-two who ran a scaffolding company in London for 50 years, has sunk around £500,000 into the site over the years and intends passing it on to his family one day. But the idyllic setting was changed forever when approval was given for the warehouse after a local farmer applied for permission. 'I have it valued every now and then because estate agents are always offering free valuations,' said Mr Lungley, who lives in his home with his two dogs. 'It went up and up and up [in value] and three years ago I had it valued and it was worth £1.5 million. Then when this building went up, I had it valued again and it was £1.2 million. 'Now it's gone down again. According to Zoopla it's worth £900,000. If they had built houses on it, it wouldn't be so bad on the eye. 'There are six or seven families in a little group here who complained about it [when the planning request was submitted] but that didn't get anywhere. 'I suppose it's a god send that it's only one warehouse, not ten or 11 little ones which we could have got. 'But another one is going to go up on the other side of a road that runs through the site and it's even bigger. That's lots of warehouses and I think it's 156 acres. 'It used to be farmland. Certainly it's sad to have lost that view because there were deer and hares and everything over there. 'I could look into legal action about blight but I can't get the money.' Noise pollution hadn't been an issue, he added, but lights were left on all night at the car park until he spoke to the council and enforcement officers were called in. The land the warehouse is situated on was sold by a farmer and planning permission for a business park was granted in August 2021. It is run by Gateway 14 Ltd, a wholly-owned subsidiary of Mid Suffolk Council has permission for 2.36 million square-foot of floor space and is part of Freeport East, a set of low-tax, low-regulation zones given the green light in December 2021. The Range secured its plot in June 2022 and planning approval for the warehouse was granted in October that year - despite objectors including Creeting St Peter Parish Council. Parish councillors cited problems including traffic generation, lack of landscape details, noise problems and uncertainty over whether enough parking spaces are included in the plans. The Range moved into the 'mega-shed' in November 2023. In May last year, Mid Suffolk Council granted permission to add to the plot, which is the largest business park in East Anglia. The council and The Range were contacted for comments.
