• Sophia Wagner

Where You Bank Matters: Voting for the Future you Want with Your Bank

A quick guide to making more money and supporting your community by voting with your bank. This piece is a guest post from Sophia of Mighty Deposits.



Photo Credits: Unsplash

We vote with our ballots because our future depends on it. Did you know we can also vote for our future with our choice of a bank?


When money is deposited in a bank, the bank can lend or invest it in a variety of things - small businesses, speculative financial instruments, fossil fuel extraction, solar farms, mortgages for veterans, you name it. It differs drastically depending on the bank. These choices made by banks affect the well-being of our neighborhoods, the stability of our economy, and the quality of the air we breathe, both now and for decades to come.


Regardless of what you care about, the bank you choose ends up choosing what your money is used for. If you think of a bank as a factory, your deposits are a raw material and loans made by the bank are an end product. As a consumer, if you want to have an active voice in this process, you can choose your bank intentionally, and thereby have some control over the trajectory of your money.


Plus, if you’re someone that’s already dedicated to justice or equity in your work or life, taking an extra moment to check up on your bank can help ensure your banking isn’t unintentionally undermining your other efforts. (Ex.: You donate $20 to an environmental organization, but your $1000 in your bank account is funding ecological destruction while you earned $1 in interest.)


Early in your career, there’s a good chance that the majority of your wealth is kept in bank accounts. That means your choice of bank or credit union can be one of the most socially and environmentally impactful decisions you can make with your money. If you’re interested in getting your money aligned with your values, the good news is that it can be easier than you might think.



💡 Quick Facts About Values-Aligned Banking:

  1. You can actually earn a higher interest rate

  2. It can take as little as 10 minutes to open a new bank account

  3. You have a lot of options: there are 10,000 banks and credit unions in the US



🤔 Common Questions About Switching to a Bank that Aligns with Your Values


Will I earn a worse interest rate if I switch banks?

If you’re like the average person, no. The four most popular banks in the US offer some of the lowest interest rates, meaning if you switch to a community-focused option, there’s a good chance that you’ll earn a higher interest rate. If that’s not the case, some people are willing to forego a bit of interest in exchange for knowing that their deposits are supporting what they believe in (especially if you’re already giving up money to make charitable donations, it makes sense to ensure the rest of your money in the bank isn’t working against that cause).


Is it risky to use a smaller bank or credit union?

No. There are 10,000+ banks and credit unions that are fully insured by the FDIC and NCUA, so your deposits are guaranteed by the US government (up to $250,000 and sometimes more, if needed). This means your money is just as safe as it is at the most popular banks.


There’s one perk at my current bank I just can’t give up. What should I do?

If you have complicated financial needs and you’re sure your current bank or credit union is the only one that can help you, there’s no problem with keeping an account open to take advantage of a specific perk. Just keep in mind that the more you treat a bank like your “main bank” (credit cards, multiple accounts, loans), the more you are supporting that bank’s impact.


Do I have to sacrifice digital convenience?

Online banking and mobile apps are pretty common at banks of all sizes (with exceptions, of course). Some apps might not be the sleekest, but they get the job done. If you’re just plugging your bank account and routing numbers into financial apps anyway, you may not have to interact with your bank app too often.



💪 How to Take Action


1. Reflect on your priorities and check up on your current bank

Young people are often told to start optimizing their personal finances early, but we often don’t discuss the whole range of factors a person could financially optimize for. Those factors could include personal wealth creation, stability, money contributing to a healthy future for yourself and your community by doing the least social or environmental harm, convenience, forming a relationship with a financial institution you can tap into later in life-- it really depends on your own priorities. (Luckily, there are plenty of options where you can get all of the above, and more.)


After reflecting on your banking priorities, check what your money is currently up to. One way to do that is by looking up your bank or credit union on Mighty.

2. Find new banks based on what you value

There are thousands of safe and competitive banks and credit unions in the US, so you can likely find one that matches your values and requires no/minimal sacrifices when it comes to interest rate and convenience.


Starting by picking a topic that resonates with you, whether that’s Black owned or led banks, banks and credit unions that don’t invest in fossil fuels, banks focused on financing Main Street instead of the financial economy, credit unions that specialize in serving low income communities and communities of color, socially responsible banks or something else (you can browse all banks or all credit unions to look for places or causes that matter to you).


There’s a huge range of banks out there, from Southern Bancorp, an anti-racist bank focused on investing in rural and underserved communities, to National Cooperative Bank, a fossil-fuel-free bank focused on financing cooperative business models, to Providence Bank & Trust, a community-focused bank supporting small business and housing in Chicago’s South Side and Northwest Indiana, to thousands of other banks and credit unions that all have unique financing strategies.


Once you’ve found a bank or credit union you like, you can start by opening a savings or checking account (you don’t have to necessarily move every single dollar, yet). This gives you a chance to get to know the institution. Then, you can start to evaluate if they’re a good fit for your remaining accounts or loans.

3. Be vocal about where you bank and why.

Here’s an example of how to raise awareness for your intentional banking choices.


Our generation can make clear that banks and credit unions will be evaluated by us for their impact on people and the planet. If enough of us do this, we can help make it a no-brainer for banks to be transparent and responsive to the social and environmental values of their customers because those that do will be our trusted partners to help us manage all the money (and influence) we’ll be wielding in our lifetimes.


About the Author

Sophia Wagner started working to increase transparency in the banking system when she was 20 and eventually co-founded Mighty Deposits. Visit mightydeposits.com to look up any bank or credit union in the US, see what they invest in, and search for banking options that align with your values. Mighty Deposits analyzes millions of pages of public data so you can find banks that are good for people & the planet according to facts, not ads.


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Disclaimer: The content on Young, Not Broke is for informational and educational purposes only and should not be construed as professional financial advice. Should you need such advice, consult a licensed financial or tax advisor.


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