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Consciously Frugal: Socially Responsible Banking


We can choose alternatives to traditional banking institutions so that our money gives less support to greed's golden parachutes and more to community development programs.

First it was the changes in the terms of a credit card, buried deep in the tiny print of an annual "privacy notice" mailing, letting me know that my interest rate would be doubling...just 'cuz.

Then came the nightmarish new bankruptcy laws written by MBNA and signed into law two days before Katrina hit. The icing on the cake? Floods no longer held the same sway in filing for bankruptcy. Nor did medical expenses, which is the primary cause of most personal bankruptcy filings. Katrina wipe you out? Medical emergency your insurance refused to cover eat through all your assets? Too bad, so sad. Bankruptcy can't help you, because the credit demons changed the rules of the game to favor their endless greed.

It just kept getting better. The greed finally exploded, and the fat cats cried for a bailout. They insisted the entire economy would collapse, leaving us clamoring for food and employment like Depression Era days of old. Nevermind the countless industries below Wall Street's radars. Nevermind the frivolous spending and immoral consumer gouging. Nevermind that a nation's financial health cannot be built upon its citizens' debt. Nevermind reality. Those who profited from the backs of the poor were now going to bleed taxpayers dry for generations to come.

I don't know about you, but I've had about all I can take of these bastards. We're all bound to them by some degree, but we don't have to play with them in every aspect of our financial lives. (And yes, for my friends who work at banks, you're right. Not all mainstream financial institutions are devils. Some even tried to refuse bailout bucks but were essentially forced into taking the money.) Much like Socially Responsible Investing, we can choose alternatives to traditional banking institutions so that our money gives less support to greed's golden parachutes and more to community development programs. (Can I get a witness?)

So, I'm switching banks. Co-Op America has challenged us to put 1% of our money into community investment financial institutions. Me? I'm starting with my paycheck and then moving all my investments over. I hope you'll consider joining me in the land of Socially Responsible Banking.

There are several socially responsible banking options available. You can leave Bank of America (who will receive the second largest chunk of the first bit of bailout money, by the way) in your dust by joining a a local credit union. Credit unions are cooperative financial institutions owned by its members, which gives you a greater voice and often better rates for loans than traditional banks. Credit unions also frequently offer free community education programs and invest in community development programs. To learn more or find a credit union near you, check out Credit Unions Online.

You can also choose to put your money in a Community Investment Bank. These banks provide financial resources and opportunities for economically disadvantaged people who are normally left behind by traditional banking institutions. They help start small businesses, support community initiatives, and provide home loans with reasonable rates to low-income families. Basically, they operate like traditional banks but without the greed and with a heavy dose of community service.

But don't think that Community Investment Banks are only for poor folks in urban areas. ShoreBank, an environmentally and socially responsible bank that is dedicated to protecting the environment and improving communities, is offering 3.5% APY on their online high-yield savings account, and each person that funds an account with $500 or more by November 15th will receive a sustainable canteen (just use the promo code "canteen" when signing up. And yes, it's December. Try it anyway!). This online banking option allows anyone to sign up and you can feel good knowing your money will be put to use rebuilding communities and giving people a hand up instead of funding lavish parties for corporate executives.

What impresses me about ShoreBank is that they work with faith-based non-profits. Most of my non-profit career has been in faith-based organizations, and traditional banking institutions will often not fund religious based NPOs, regardless of their work (I understand not wanting to fund controversial issues. But feeding the homeless? C'mon now). You can read about some of ShoreBank's EcoJustice work here and work with underprivileged youth here.

ShoreBank is just one of many community investment banking institutions that you can join (although I haven't found as good of an interest rate among their competitors for the online savings account). To learn more about other socially responsible banking options, check out Co-Op America's (soon to be Green America) Socially Responsible Financial Services Directory. To learn more about community investment, visit Co-op America's Community Investing Center.

I hope you'll join me in providing the traditional financial industry a genuine bailout--bailing out of their irresponsible, immoral institutions and placing our money in banks that work to protect the environment and our communities.

(Thanks to Kathryn Benedicto for the generous gift membership to Co-op America with its endless, amazing resources. Thanks also to Tracy Fischer of ShoreBank for providing information about ShoreBank's community investment initiatives.)

Read more tips and topics that address living frugally in a socially conscious manner, respecting community, the environment and our global human family at:


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