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I was gifted a very small stock portfolio from my grandfather when I was young, so in addition to the usual indirectly-held, "melting pot" mutual funds that make up the bulk of most American investment portfolio, I hold a few individual stocks, now all on DRIPs.

As part of my long-term (to the extent one can say that right now) plans, though, I do want to diversify my individual holdings into a mix of stocks and bonds. However, I don't just want to hold a random collection of bonds from wherever; instead, I want my money to go into bond issues that I can abide by holding. In particular, I want to see the following things from my bond investments, in order of decreasing priority:

  1. Humanity. First and foremost, I want my money going to projects that favor people and urban places (centripetal or at the very least nodal in nature), not cars and uniform sprawl (centrifugal, if you will). As a result, a typical bond fund's creditworthiness-only criteria are decidedly unappealing to me -- who cares if a municipal creditor meets Moody's standards if Moody's can't see that municipalities going a-sprawling out to the horizon with low-density single-family subdivisions, parking-moat-surrounded strip malls, and grade-separated multilane highways must come to a crashing halt sooner or later?
  2. Solidarity. There are quite a few bond-issue-funded projects in America which are under political fire (California High-Speed Rail and congestion pricing, for two examples) or could wind up facing political headwinds in the future. Buying into these projects is a way I see of providing me with a small amount of political leverage against people who'd want to pull the rug out from under said projects.
  3. Locality. I do have a desire to support institutions, such as the relatively-urban public school district that educated me, that helped put me where I am right now, and I see supporting their bond issues financially in addition to politically as another way of "putting my money where my mouth is".

Given that individual bonds from specific bond issues seem to be harder? to buy and hold than individual shares of companies, how can I invest in bonds in a way that meets these criteria? Are there specialty bond funds out there that I just don't know about, or is my assumption that bond funds are entirely centered around creditworthiness ratings on point? Is there a way for individual, average-person investors to buy small quantities (in the $100s-$1000s of dollars) of bonds from individual, primarily-municipal bond issues?

ThreePhaseEel
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Most corporate bonds do not go to specific projects, they are used as general funds by the corporation.

Municipal bonds, however, can be "Earmarked" for specific projects or purposes, often for school districts, or for infrastructure projects like highways. It can be hard to find them, though. There are some bond screeners that you can filter by name and other attributes (or ask your favorite AI chatbot), but you'll have to look at the prospectus of the bond to see what the money is actually used for.

One drawback of individual bonds is that their face value is often $1,000, and since munis have very low default risk, they trade close to $1,000 each as well. I do not know any brokers that offer "partial" bonds like they do stocks.

There are also bond funds that will hold hundreds or thousands of municipal bonds, but they will be very widely distributed and may not fit your narrow criteria.

As a side note, understand that buying a bond on the secondary market does NOT impact the issuer of the bond in the slightest. They already got their money from the initial offering (just like when companies issue stock). So unless you are in on the initial offering, and no one else would buy any more of the bonds except you, your investment, while maybe easing your conscience, is not directly impacting the project or organization it was intended to fund.

If you want to make a direct impact, then donating to charities or causes that you believe in will be more impactful.

D Stanley
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