Wednesday, November 24, 2010

Conscious Shopper Challenge: Bank Sustainably

This week's Conscious Shopper Challenge...

I'm in the midst of Thanksgiving preparations and having trouble finding time to blog this week. I don't want to leave you in the lurch on this week's challenge, but I'm afraid I'm not going to be able to come up with an original post today. So instead, I'm republishing a related post from my defunct Conscious Shopper blog that explains why banking is an important part of being a conscious shopper. As a little background - this was a post I was writing for the APLS Carnival on the topic of "charities."

Several times when I've told my husband what the topics are for the two blog carnivals I participate in each month, he has responded, "Who comes up with those?!"

I personally enjoy having a topic to write about. It taps into a different type of creativity than just blogging about anything that comes into my head. But this month was different. This month I had trouble coming up with anything to say.

For the record, I'm not saying anything against Green Resolutions, who came up with this topic (and happens to be one of my favorite green bloggers...and I really do think it's a great and unusual-in-a-good-way topic).

But, you see, my problem is that I don't give money to any charities...

I'm not saying never. I've dropped many many handfuls of change (and even a few dollar bills here and there) in the buckets of the Salvation Army, and even in the cups of beggars on the side of the road, although I've been told you shouldn't do that. We used to give to our local fire department every year after they miraculously saved all of our belongings in an apartment fire the first year we were married (and hey, hubby, we ought to start giving them money again...). And when we feel financially secure, we've been known to support our favorite organizations (NPR, New American Dream, Green America, the Sierra Club), who do great good, even if they aren't technically charities.

But the thing is...we give 10% of our gross income to tithing. I know my church is using that money for good, and I think 10% is all any reasonable person should be expected to give. If I were wealthy, I would give much much more, but in the meantime, I'm giving as much as I can. But tithing is not exactly the same as giving to charity.

So as I pondered this topic some more, I began wondering if there are ways to give to people in need and to give back to the community without money. And then I remembered an email I received from Green America a month ago with the subject line: Break Up with Your Bank.

The email was a reminder to me and other Green America members about the ridiculous behavior of many banks in this time of economic crisis. (The bank I use, for example, Bank of America, is receiving a $45 billion dollar bail-out but threw a $10 million dollar Super Bowl Party.) The email then went on to encourage Green America members to switch to a community investing bank.

What is a Community Investing Bank?

To understand what community investing banks do, you have to remember that when you stick your money in a bank, it doesn't just sit there, like valuables in a lock box, waiting for you to come collect it. The bank puts your money to work. They loan it out to people and charge interest, and they invest it. That's how banks make money, and also how they can afford to pay you interest on your savings accounts.

It's a smart system that benefits both the banks and the people who use them, but there's a catch: you have no say in where your money is loaned. Bank of America, for instance, is one of the largest investors in the U.S. in coal mining and coal-powered plants. I'd prefer not to be supporting that, thank you very much.

With a community investing bank, you still have no say in who gets to use your money, but you will have a general idea where it's going. Community investing banks loan to local organizations and businesses, economically disadvantaged people, and often environmentally friendly or socially responsible businesses and organizations as well.

Why should I use a community investing bank?

Green America explains, "Community investing provides the means for low-income people to use their own skills and talents to lift themselves up economically—the money provides loans to start environmentally sustainable businesses, builds schools, or funds critical services like affordable child care. As the saying goes, it’s not a hand out, but a very effective hand up for people who have been disenfranchised by our economic system....Continue to be generous in giving to charity, and then also devote at least 1% of your portfolio to community investing."

Plus, according to the Better World Shopper, changing your bank is the #1 thing you can do to vote with your wallet. And when you think about it, it seems obvious...Banks control where the dollars go, and they manage huge amounts of money. So it does no good for someone to start buying organic cotton clothing if they are still supporting a bank that invests in pesticides. Picking a bank and a credit card that make sustainable and fair choices will greatly magnify your ability to vote with your wallet.

How do I find a community investing bank?

If you live in Raleigh, you're lucky because I've done all the work for you. There's a credit union in Durham called Self-Help where you can open a savings account, CD, IRA, or money market account. If you don't live in the Triangle and would prefer a bank closer to you, you can check the Community Investment Database.

I am also interested in an online bank called ShoreBank Pacific, which is "committed to environmentally sustainable community development." The disadvantage of an online bank, of course, is the inability to withdraw money from an ATM. (The most attractive feature of Bank of America, when we chose it, was it's nationwide system of ATMs). But there are ways to get around that, like keeping a small account open in a nationwide bank for withdrawals.

For more information about community investing, you can read Green America's guide to Investing in Communities.

*Photo by borman818

1 comment:

Daisy said...

My family also banks at a credit union. It's small and local, yet has the backing of the federal insurances that keep our money safer.


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