At Brightly, we always encourage you to vote with your dollars and support brands that are changing the world for the better. Starting today, we’re also encouraging you to green your finances.
What traditional banks do with your money is problematic at best. The top four banks alone invest 210 billion dollars each year in fossil fuels. Banks also spend about 100 million dollars per year on lobbying and campaign contributions so that they can charge you even higher fees.
Thankfully, some financial institutions are doing things differently. They’re worth checking out: greening your finances can be up to 27 times more effective than the combined effect of consciously shopping, eating less meat, and donating to nonprofit organizations.
Green Your Finances With Aspiration
Andrei Cherny co-founded Aspiration with the idea that banks shouldn’t use your money in ways that don’t align with your values. Before founding Aspiration, Andrei worked with Al Gore in the 1990s on bringing awareness to climate change. He also served as a financial fraud prosecutor and established a D.C. think tank that partnered with Elizabeth Warren to create the Consumer Financial Protection Bureau.
“There’s so many conscious consumers who are bringing their ethics and their belief in environmental sustainability into the daily spending decisions they’re making…when they’re buying groceries or clothes or coffee. And yet, they’ve never had a financial institution built around those same values, that not only stops them from doing the kind of harm that they’re doing but actually helps them to automate their impact so that they’re doing good,” says Andrei.
As a certified B-Corp and a member of 1% for the Planet, Aspiration has committed to promoting causes that matter. Andrei explains that “from day one, we said, ‘we’re going to give 10% of every dollar of profit that our company earns, towards charitable giving.’ [This is] an enormous, enormous dedication and level of commitment for any financial institution.”
Why Banks Win When Account Holders Are Hurting
Banks earn money from ATM fees, overdraft fees, and account maintenance fees. On average, they make $600 off of every single account holder each year.
“These banks have wanted to find other ways to maximize their profit. And so they have continued to increase the fees on overdrafts, the fees on ATMs, the fees on monthly service fees that a lot of people are paying. And so people end up paying hundreds of dollars a year in fees, most of the time without even knowing it. It’s unconscionable.
The truth is, for most people, their bank does better when they’re doing the worst in life…It’s when they’re hurting the most economically that the bank is pulling the most from them,” says Andrei.
Community banks are slightly better than conglomerate banks. They usually lend money out to people in the community rather than to oil or gun companies. Still, many community banks charge fees, which are sometimes even higher than larger banks.
How Big Banks Invest Your Money
When your money is in your bank account, the bank isn’t just holding it for you. They’re loaning it out and earning money off of the interest rate they charge on the loans.
Big banks lend money to projects that are guaranteed to make them a healthy profit. Since 2016, big banks have invested 2.7 trillion dollars into fossil fuel projects (and no, that’s not a typo—it really is TRILLION with a T!). For context, that’s more than all of the money in circulation in the US.
“A company like Chase, they spend more in loans to fossil fuel projects—that are coming from their customers’ deposits—but they spend more in those loans than the combined entire market value of BP and Exxon Mobil combined.
And so it’s when you are somebody who is shopping sustainably, who is thinking about recycling. And yet [you’re] making those purchases with a Wells Fargo or Bank of America debit card…the negative impact you’re making is much more in excess of the positive that you’re doing,” says Andrei.
Along with fossil fuel investments, banks invest in companies and projects that harm us socially and culturally, such as the for-profit prison system and gun manufacturing.
Lobbying Efforts and Political Campaigns
Banks also donate to political campaigns on both sides of the aisle and lobbying efforts. These donations are often geared toward allowing banks to charge even more in fees and return less interest.
“Lobbying groups are not looking out for the interests of their customers…they’re looking for more ways in which to be able to get more money from their customers. That’s what those businesses are built on. And so it’s totally unfair that people should be footing the bill for campaign contributions to politicians that are working against their interests,” Andrei says.
Measuring the Social and Environmental Impact of Your Purchases
Aspiration strives to be better than big banks by being transparent about their charitable efforts and making it easy for consumers to green their finances.
Money Doesn’t Grow on Trees, But it Can Plant More of Them
“A big part of what a conscience-driven financial institution does is to stop doing harm. And there’s a bunch of institutions that have come up over the years that that are doing a good job at that. I think what makes Aspiration really unique is that we take another step beyond that, not only do no harm but actually, how can your money do good,” says Andrei.
One way that Aspiration uses your money for good is their tree planting program. Account holders can choose to round up each purchase to the nearest dollar. Aspiration uses those extra cents to plant trees through partner organizations like the Eden Reforestation Projects, the Trillion Tree Campaign, and the Nature Conservancy.
Aspiration account holders can see how many trees they’ve planted alongside their account information. You don’t have to have an Aspiration account to participate, though: you can green your finances and plant your change with any US debit or credit card.
Helping Consumers Make More Sustainable Decisions
Aspiration sets itself apart by offering a service called AIM, or the Aspiration Impact Measurement. AIM is a personal sustainability score. It measures the purchases you make against thousands of data points about the companies you buy from. You can see each company’s scores, which consider their treatment of their employees and the environment.
Giving Back to Consumers Who Buy From Sustainable Brands
Lastly, Aspiration has a program called the Conscience Coalition. Consumers can earn up to 5% back on purchases at sustainable partner brands like TOMS and Warby Parker. Some of Brightly’s favorite brands are part of this coalition, such as United by Blue and Causebox.
Resources We Mentioned
- Sign up for an Aspiration account
- Aspiration’s Pay What is Fair fee structure
- Plant Your Change
- Aspiration’s Conscience Coalition
- Our favorite ways to live sustainably (and affordably)
The Aspiration Plus Debit Card is issued by Coastal Community Bank, Member FDIC, pursuant to a license by Mastercard International Incorporated.
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