How to save money and stay ethical
You might be doing your darndest to be an ethical consumer: buying green and local, reusing and recycling, and supporting bigger retailers that share your worldview. But if you’re not properly investigating your savings accounts, the source of your energy supply, or what your superannuation is invested in, then you could be counteracting all those positive actions with some big missteps.
Here are seven avenues to explore that’ll help you save cash, the environment and your ethical integrity in a few wise money moves.
Fuel your savings account sans fossil fuels
Even if it’s not the most altruistic pursuit, there’s nothing wrong with keeping a little extra dosh tucked away for yourself. You can use the funds to support loved ones or yourself in an emergency, or invest in your future by finding a competitive home loan rate. But not every bank has sustainable intentions. Find out which banks don’t invest in fossil fuels through financially-focused environmental campaigners Market Forces, then check out some of the top-notch savings accounts offered by these providers.
Find more sustainable savings with a green term deposit
Looking to make a longer green savings commitment? Banks and lenders can do more beyond swearing-off fossil fuels and the UBank Green Term Deposit is a prime example. For every dollar you stash in this account (with terms between 2-11 months), UBank will commit the same sum to supporting renewable energy and low-carbon transport and building projects. Keep in mind, this digital bank is owned by NAB, which has invested in fossil fuels despite taking steps towards a greener approach.
Investigate a ‘renewable’ or ‘carbon neutral’ energy plan
You’ll need to know what both these terms means in relation to your utilities before signing up. A renewable energy plan will be part of the government’s GreenPower Program. It involves instructing your provider to purchase electricity from sources like wind, solar, water and bioenergy through accredited Australian renewable energy generators on your behalf. You will pay a premium, as providers are buying this through new grid infrastructure which, for now, is more expensive to run.
A carbon neutral energy plan is about offsetting your carbon footprint and could be a cheaper alternative, as most providers offering these products let you opt-in without a fee. These energy plans require providers to invest in global emission-reducing projects, to the point where your household carbon footprint is made ‘neutral’ by the efforts of that commitment. At the moment, players making big waves in carbon neutrality include Powershop and EnergyLocals, which have hit the 100% carbon neutral mark, as well as Diamond Energy with its dedicated renewable generators and sustainable investments.
Align your bank with your ethical priorities
Put your money where your values are by choosing a bank that supports the same causes you do. If you want to put your finances behind the fight against climate change, you might seek out Teachers Mutual Bank with its carbon neutral operations and fossil fuel-free investments. Bank Australia has built its public image on responsible investing, axing investments in industries like firearms, tobacco, fossil fuels and live animal exports, which don’t prioritise positive social and environmental causes. It’s also a customer-owned bank, meaning you’ll become a shareholder by banking here and the bank’s mission should align with yours.
Get on the right long-haul track with a sustainable super fund
As in the case of savings accounts, your superannuation could be invested in unsustainable environmental practices. Market Forces has identified the investments of super funds and to what degree these support the climate goals set out in the Paris Agreement. If your financially comfortable retirement is being built on the back of fossil fuels, investigate switching to a more sustainable fund. You may even dig up some long-lost savings by consolidating forgotten super funds (if they haven’t already been transferred to your main fund via the government’s Protecting Your Super package).
Claim tax deductible donations
Donations are a practical way to contribute to causes you care about, and if you give $2 or more to an eligible charity or group (known as deductible gift recipients or DGRs), you can claim a deduction on it at tax time. There are strict guidelines around what constitutes a claimable donation and you’ll want to keep receipts or bank statements to use as evidence in most claiming scenarios. The ATO app has a useful tool for tracking donations throughout the year. Digital donors should be aware that many crowdfunding sites, while supporting eligible charities, are not run by DGRs and so donations made through them aren’t claimable.
Grow, reuse, borrow and shop pre-loved
There are many ingenious ways to take part in the circular economy, which breathes new life into consumer products rather than chucking them into landfill. Reusing and recycling delivery boxes and food containers is a must, but you can also circumnavigate a build-up of plastics and non-recyclable rubbish by growing your own food and composting scraps. Or start your shopping journey in the second-hand department, then look into swapping or selling items once they’ve served their purpose, or mend beloved pieces for longevity. All this thrifty action can be a funky hobby and will save you loads over buying new products.
RELATED ARTICLE: Your essential guide to building an emergency savings fund.
Don’t have quite enough savings to invest in a sustainable endeavour like installing solar panels or rainwater tanks? There are green personal loans that’ll help you get there faster with a lower interest rate than the average personal loan.