In a recent post, Emma shared her tips on how to save both pennies and the planet. Today, I (Tamara) am continuing the theme of money by sharing my attempts to ‘green’ my finances.
But first, a HUGE proviso! Though very wise, clever, smart and beautiful; I am not a financial guru or advisor. I am simply writing from my own personal experiences. This is not about me making or saving money but about me trying to be ethical in how I organise my finances and store my money.
Level 1: subscribe to the Ethical Consumer (Difficulty Rating: easy)
I share a subscription to The Ethical Consumer with a friend and it has been the number one most useful and informative resource in researching and deciding how to spend my money ethically. (This is not a sponsored post or any of that!). The Ethical Consumer does Shopping Guides, Company Profiles and basically it is where I go for clear answers when I am overwhelmed by choice. It has influenced all my choices which I will discuss below. If you can afford it, at £30 a year, get it!
Level 2: choose a bank with values (Difficulty rating: Intermediate)
Did you know that the big commercial banks are the worst? Main banking providers like Natwest, Lloyds, Barclays, HSBC etc are not the safe havens they appear in the ads. I was devastated to realise that the banks I was loyal to since I opened my first account at age 13 to save my Saturday job earnings in are funders of arms manufacturing and investors in the fossil fuel industry (to name but a few). These are powerful institutions focused on profits and not people.
I felt rather smug, many years ago now, when I decided to move away from terrible banking and opened a current account with Smile, then the best (in my opinion) ethical banking choice in a very limited pool. But the times have moved on and Smile, which is part of The Cooperative Bank, is no longer the top or only choice.
Triodos: a unicorn in the banking world
Triodos is the best. I do not mean it is the best of a bad bunch. Oh no no! Triodos is simply the best…dun… dun… better than all the rest! (channelling my inner Tina Turner!).
You see, Triodos doesn’t only choose not to invest in the bad aka unethical and unsavoury industries, Triodos actively invests in the good aka sustainable, ethical and planet & people protecting industries and projects.
Even their debit card is eco-conscious as it is made from PLA which is a plastic substitute made from renewable sources such as plant leaves and corn. But to be honest, it is their ethical policies and transparency that really give me a hard-on, though the small things are important too. (haha, that’s what she said! Sorry. #notsorry.)
I’ve had a saving account with Triodos for about ten years and will soon be opening a current account with them when I get my ID sorted. (Off-topic rant – can you believe that both my passport and my driving licence expired in the same month. Adulting is hard.)
By this, I mean member-owned banking institutions like Building Societies and Credit Unions. Unlike commercial banks which are run for the profit of shareholders, here each customer is a member and has a say in how the organisation is run.
a) Nationwide Building Society
Nationwide is my compromise joint bank account with my husband, the Dutchman. After The Co-operative bank became 70% investor-owned and seeing that the Ethical Consumer rated them fairly well, he decided to move his accounts from Smile to Nationwide Building Society.
We have a shared account with Nationwide and the rest remain with Smile because as well as not being good with change, I still felt a loyalty to Smile and I was holding out for a Triodos current account. We compromised by initially keeping some accounts with Smile and transitioning one to Nationwide with ultimately all our shared accounts eventually being moved to Nationwide.
b) Wessex Community Bank
Whenever I cycle down Fratton Road, I notice the Wessex Community Bank nestled between The Bridge Shopping Centre and Garnier Street. Each time, I add it to my mental list of things to check out and immediately forget once I have cycled past.
Writing this article meant I finally researched it and I was thrilled to discover it is a not-for-profit community bank (a credit union) that invests solely in the Hampshire and Isle of Wight region. It is a proper local bank!
I plan on joining their Christmas Club saving scheme as I am tired of always being overdrawn come January. 2020 is my year of taking control of my finances!
Level 3: CHOOSE AN ETHICAL MORTGAGE (Difficulty rating: Advanced)
I rate this as Hard/ Advanced as for me this was the most difficult decision to make in terms of prioritising ethics over finances.
It is a privilege to be in a position to hold a mortgage. It is also my largest financial burden and my biggest monthly expense. I want that money to be invested positively by my mortgage provider. I have previously held a mortgage with The Co-operative Bank but wanted to up my game in ethical finances.
The Ethical Consumer was a key tool in helping us research and ultimately decide to apply to Coventry Building Society for a mortgage. A huge bonus is that the mortgage interest with them was as good a deal as the ones offered by the usual big banks. So it was a win-win, both financially and ethically. I consider this my biggest success in walking the walk and not just talking the talk.
Level 4: CHOOSE AN ETHICAL pension (Difficulty rating: expert)
This is where my laziness really shows. I don’t really get pensions and I think the fact I even have a pension is me Adulting at the highest level.
I want a safe, secure and ethical pension that doesn’t just not invest in fossil fuels, fracking, arms trade and all that fun stuff but also invests positively in sustainable, ethical, people and planet-friendly funds. I basically want the Triodos of pensions.
Quite by chance, I hold a pension with Royal London who is currently ranked the top pension provider by The Ethical Consumer. And the Dutchman has a workplace pension with Aviva, who is rated second. But unlike Triodos, for example, these are the best of a bad bunch.
I feel my only option is to learn more about pensions (ergh) and start lobbying my pension provider to do better.
But ideally, I’d have a pension provider that is making actively positive ethical investments and so far, I haven’t found that.
And what of you, Dear Reader? What are your experiences of ethical banking? Do you have an answer to my pension quandary? Let us know in the Comments section.