How to make money helping the environment by switching your account

Here is a fab contributed post from MyMotherTree.com. If you’re someone who is conscious of how your money is impacting on the planet, there’s no better place to start that your bank! It’s a simple way to start reducing your carbon footprint. Don’t forget to look out for switching deals so you can make money helping the environment too!

 

Why Not All Banks Are Good For The Planet

Did you know that for the average UK resident a massive 50% of their personal carbon emissions come from the money they keep in a bank account and their pension? [1] [2]

That might come as a surprise but the financial institutions you choose to keep your money with could be having a big impact on the environment. The sad reality is that the world’s biggest banks like HSBC and Barclays are funnelling billions of pounds into oil & gas projects every year. [3]

MyMotherTree.com research finds that in 2020 the average UK adult had £5,677 in savings. [4] This amount held in a Barclays account is producing the same levels of CO2 each year as the production of 42kg of beef [5] (or 360 burgers). For context, keeping £5,677 with Barclays produces more CO2 than seven return flights from London to Rome. [6]

The Money Carbon Calculator

Where we decide to keep our money is, arguably, the single most important choice we make when it comes to combating the climate crisis – that’s why we built the world’s first money carbon calculator. By knowing the impact of your money, we can choose the companies we want to invest in today and decide which industries will thrive tomorrow.

Our money carbon calculator is simple and completely free to use. It takes just 2 mins – all you have to do is enter the amount you have with your bank and we display your money carbon footprint. 

Not only do we calculate the footprint but we also show you what you can do about it. You’ll be presented with a selection of banks and pension providers that you can switch your money to reduce your carbon footprint. These FSCS-protected banks invest your money in low carbon activities to ensure your money aligns with your values.

And what’s more, choosing a greener bank and pension provider does not have to be at the expense of your returns. Our research suggests you don’t have to sacrifice returns by going green. In fact between 2016- 2021, sustainable funds grew 13.9% more than standard pension funds. [7] So by switching to a green bank not only you can save the planet but also potentially grow your returns.

Give our free money carbon calculator a go – it might just be the most significant change you make to fight the climate crisis.

For further information visit www.mymothertree.com

What Happened When I Tried It?

Of course, I had to try out the calculator for myself! Based on the details I entered, the calculator told me that my money’s carbon footprint is 4.48 tonnes of CO2 per year which is the same as flying from London to Rome 17 times!

The biggest change (a whopping 83% reduction in my carbon footprint!) was in one of my pensions, and that I could choose a sustainable fund instead of the one I was in. The calculator also gave me some recommendations for a variety of eco-friendly savings and current accounts that I could consider switching to. One of them offered a switching incentive, so I could make money helping the environment too!

My Thoughts

I think this is a great initiative, and I will certainly consider changing my pension fund over. However, what I would say is be very careful before changing anything. Make sure you read up on the bank you are thinking of switching to, and read the small print of any switching incentives. Also, if you are considering an investment switch, make sure you’re not losing any benefits by switching away from what you’re currently on.

If you need help, why not check out The Female Money Doctor’s Little Black Book for providers who can advise you on this further.

After you’ve worked out your own carbon footprint, let me know your result in the comments!

​​References

[1] Based on having £6,757 in a current account with Barclays and a pension of £42,651 held invested in the UK Equity Fund over 25 years. Note, in 2020, the average person in the United Kingdom (UK) had £6,757 saved (source: https://www.finder.com/uk/saving-statistics. Analysis conducted by finder.com/uk). Note, The UK’s average pension pot stands at just £42,651 (source: https://www.finder.com/uk/pension-statistics. Analysis conducted by finder.com).

[2] Based on analysis by Accenture: The average UK household’s spending generated 204 kg of CO2 emissions each week. This equates to 10,617 kg per household per year, which collectively amounts to an estimated 295 million tonnes of CO2 in 2020. Note, this does not include any investment, bank account or pension.

[3] Fossil Fuel Financing, From The World’s 60 Biggest Banks https://www.bankingonclimatechaos.org/

[4] The average UK household has £5,767 saved 

https://www.thisismoney.co.uk/money/saving/article-11057929/One-four-Britons-no-savings-combat-cost-living-crisis.html

[5] Each KG of beef farmed and consumed produces 39.25KG of CO2 

https://static.ewg.org/reports/2011/meateaters/pdf/methodology_ewg_meat_eaters_guide_to_health_and_climate_2011.pdf

[6] 5 A flight to Rome produces 109KG of CO2 https://www.google.com/travel/flights/

[7] Based on 5-year performance of selected default pension funds (including but limited to Scottish Widows & Lloyds) compared against selected green funds, (including by not limited to Vanguard ESG Developed World & Pictet Clean Energy funds).

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