When we talk about sustainability, our initial action is to buy or consume less but there’s another side of the coin that we often forget to take into consideration such as gaining knowledge about the place we put our money to, what they do with it and what it means for you. This episode is not here to burden you with knowledge but hopefully, it may raise awareness on how you handle and change your finances that costs no money but just costs a little bit of time.
- Fees. One of the most common exploitative mechanisms big banks use to target those struggling financially is the overdraft fee. Banks reported collecting $15.5 billion in overdraft fees in 2019 alone, with nearly a third of that coming from just three banks: Wells Fargo, JP Morgan Chase, and Bank of America. And the CFPB estimates that fewer than ten percent of all bank customers are responsible for nearly 80 percent of all overdraft fees. The worst part is that there are plenty of banks out there that don’t charge predatory fees like overdraft and account maintenance. So while this episode isn’t specifically about predatory banking, fees want you to know that the only language banks understand is money, and you have a choice on what you do with yours. Fees, the only way to tell a bank you disagree with how they prey on our country’s most vulnerable, is to take your money out of their bank.
How to stop funding fossil fuels by moving to an ethical bank: The 5 steps to positive action.
Our goal is not to tell people what they should be doing ultimately with their money but we want to spread proper and accurate information. This article from Rebellion Global raised questions and thought processes for us to understand better how most of these big banks work as of today including their huge contribution on fossil fuels.
What Jen + Jill have to say:
The most important step is to investigate your bank. Jill would want us to find out everything that may interest you before moving our money to a different bank. They did list a resource that we could use called, ‘Bank Green’ which hosts banks’ financing activities. A lot of the time they would talk about their investment on renewable energy but let’s not let them distract us as the majority of the money is going towards some of these non-renewable and non-sustainable efforts then that’s just a distraction.
Jill says not to feel silly asking our bank what they’re doing with our money as you have the power because you have the money–don’t feel intimidated. If you feel like your current bank does not meet your ethical beliefs, tell them why you are deciding to leave. It’s an important step as it can be helpful for actually affecting change. We can’t expect to see any differences on what banks choose to do with the money unless we say our reason. Lastly, find an ethical bank.
Green banking: 7 simple ways you can help protect the environment
These are things you can start today whether in your current bank or you’re thinking of transferring over to your chosen new bank. The article from BankRate simply offers 7 ways you can help protect the environment from your banking practices and hopefully in your everyday life as well.
What Jen + Jill have to say:
Jill says it would be an advantage to us when we go paperless as we do not have to go to the bank anymore as we can do everything online. Use other payment methods besides checks. Jen does not entirely agree with ‘biking’ or ‘walking’ to the bank as a solution as not everyone can easily go to their nearest bank. Maybe consider choosing an online bank and use the closest ATM to you instead of walking all the way to the bank.
Jen’s portfolio is not completely divested, as she quotes, “we’re not perfect”. VFTAX excludes companies dealing with vice products (adult entertainment, alcohol, gambling, tobacco), non-renewable energy (nuclear power, fossil fuels) and weapons (civilian firearms, controversial military weapons, conventional military weapons). Jen adds that VTFAX has a slightly lower return but it is a loss she’s willing to take for not putting a lot of money for the aforementioned vice products.
How we're making our money climate-friendly
Jill does the online thing *wink* while Jen moved mortgage to a credit union, bank exclusively with online-first banks, and has a significant portion of their investments in ESG funds.
Bill of The Week
Thank you Jacqueline from St. Louis for sharing your bill about no longer paying for Netflix and NOT FEELING DUMB!
Thanks so Much for Listening!
Thanks so much for listening! Many of you know we have a private community where we do monthly money challenges and offer accountability groups. We want to congratulate one of our members for a big win:
Congrats! Thanks for listening and if you want to check out our monthly challenge community head to frugalfriendspodcast.com/club to see what challenge we have coming up next.
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