Sustainable living is all about investing in the future. So, if you’re already running shorter showers and shopping with reusable bags, why not consider how you’re managing your actual investments? It’s easier than you may think. That’s because a growing number of financial services companies, mindful of consumers who are seeking environmentally-friendly choices, have started rolling out sustainable banking solutions — from green-minded car loans to eco-conscious savings and checking accounts. So, whether you’re looking for a pro-planet mortgage or a credit card that rewards you when you make sustainable purchases, read on for everything you need to know to make your money not just green — but greener.
What is Sustainable Banking?
Also called ethical banking, sustainable banking simply means engaging in financial practices that place a priority on social and environmental responsibility. Not only about turning a profit, these financial institutions and banks recognize the importance of the planet and its people, with a focus on reducing carbon footprints and highlighting ethical practices.
Why is Sustainable Banking Important?
The traditional banking sector plays a role in deforestation, pollution, and climate change simply because it finances the industries that impact the planet the most. Sustainable banking aims to move that money to eco-friendly projects and initiatives. For example, sustainable banks avoid financing fossil fuel projects. They also prioritize fair labor practices, human rights, and community development by supporting local economies.
Steps to Make Your Money Greener
Research green banks
When selecting a bank or credit union, look for institutions that have made sustainability part of their business plans. Banks and credit unions that are members of Global Alliance for Banking on Values (GABV) or have B Corp certification status (which measures the social and environmental impact of companies) are ones to look out for.
Banks with these recognitions invest better — often putting money toward renewable energy and offsetting their carbon footprint. And even if you’re not ready to switch banks, many now offer eco-friendly paperless options to reduce waste. This allows you to bank digitally to minimize your footprint and reduce paper waste.
Invest more sustainably
If you’re interested in sustainable investing, consider putting your money into socially responsible investing (SRI) or Environmental Social & Governance (ESG) options. These funds prioritize companies that engage in environmental responsibility and ethical business practices. One example might be a company that funds fossil fuel free initiatives.
If you invest in sustainable funds, you can support businesses that are actively working to address climate change and promote sustainability in all aspects. Regardless, it’s usually smart to start small when investing in a new way, and fortunately, there are a growing number of apps and investing services that allow you to do just that.
Use sustainable banking credit cards
If you’re looking for a greener credit card, there are a range of solutions. Cards made from recycled materials, corporations that donate part of their profits to eco-friendly causes, and options that reward customers for making sustainable purchases are among the most popular.
If you’re choosing a sustainable credit card, these may offer cash back or rewards points for spending on eco-friendly products and services, such as public transportation, organic groceries, or energy-efficient appliances. If you plan on revamping your home to be more sustainable or making big environmental purchases, grabbing a green rewards credit card is a power move.
Check out green mortgages and loans
When financing major purchases, such as a home or car, explore green mortgage and loan options offered by financial institutions. Green mortgages, or energy-efficient mortgages, may provide incentives for energy-efficient home upgrades, such as solar panels or energy-efficient appliances. Similarly, green auto loans may offer favorable terms for purchasing fuel-efficient or electric vehicles. Not only could you save money on your interest rates, but you’d save on gasoline as well.
Prioritize ethical, sustainable banking
When on the hunt for green banking it isn’t only about choosing more environmentally focused solutions, it’s also about prioritizing companies that conduct ethical practices. Seek out banks and credit unions that prioritize transparency, fair lending practices, and community engagement. Avoid institutions that invest in environmentally harmful industries, such as fossil fuels or deforestation. Do some research on your current banking solutions and any company you may be considering when getting a new credit card or changing your checking or savings account.
Practice conscious spending
Of course, you can begin your journey toward more eco-conscious financial decisions simply by deciding how and where you spend your money. Adopting mindful spending habits can help reduce your carbon footprint. Among the things you can do immediately? Start by supporting local businesses, which reduces transportation emissions. Think about how you can reduce waste by minimizing single-use plastics and monitoring your consumption habits. Also be sure to choose brands that prioritize fair labor practices, environmental sustainability, and social responsibility. Lastly, look for eco-friendly products made from sustainable materials, with minimal packaging.
One example? Switch up your laundry routine by changing to SaltyLama’s eco-friendly laundry detergent sheets. It’s a simple, convenient way to make a difference. These pre-measured, plant-based sheets will leave your clothes clean and fresh — without a trace of residue. Better still, SaltyLama’s packaging is biodegradable and compostable — perfect for Plastic Free July. And if you want to keep things even simpler, skip the store and lines by subscribing. You’ll never run out of detergent again. You can cancel, pause, or skip an order on your subscription whenever you like.
Whether you’re financing a major purchase or opening a new bank account, these sustainable banking options can help you lower your carbon emissions, make greener choices, and secure your financial well-being. By doing so, you’ll align your financial habits with your environmental values. And as more individuals and businesses embrace these green-minded practices, we can collectively embrace a more sustainable future. Happy banking!