Switching to a Climate-Friendly Savings Account

Extending my climate practice into my finances can be a tricky business. On the one hand, I firmly believe that I should put my money where my mouth is — divest from fossil fuels and invest in climate-forward companies. This should apply to my banking, my investment portfolio, and my retirement savings. 

On the other hand, I'm also a realist. The only way climate-forward finance is viable long term is if it can compete with the status quo. Not to mention, I like my cushy credit card points, ATM availability and decent ROI as much as the next person. 

In short, I want it all. I want my money to work for the planet and I want it to work for me. 

Which brings me to my current quandary: Is there a high-yield savings account with a bank that does not invest in fossil fuels? 

How I use my savings account

Normally, I accumulate savings in a traditional savings account until I've got a big enough chunk, and then I move it into my Carbon Collective investment accounts. But lately, with high inflation and high interest rates (stagflation much), keeping some emergency cash around seems like a good idea.

With the savings account I’m looking for, I plan to primarily use electronic transfers. I’ll also let the money sit for at least a year, barring catastrophe. 

There are three types of accounts to consider: a traditional savings account, a high-yield savings account, and a money market account. 

I already have a traditional savings account and these don’t don't give much return (around 0.33%). High-yield savings accounts give a higher return (1-5%), and money market accounts have similar rates (1-5%) but often require a higher minimum balance. 

For reference, interest rates in general are high right now, and 4-5% is attainable at a normal fossil-fuel-funding bank. 

What I’m looking for in a climate-friendly savings account

There’s a lot of advice out there, so I found it best to start with my personal criteria to make it easier to narrow down my options. My requirements for a climate-friendly savings account are pretty minimal. 

1. The bank must not invest in fossil fuels and preferably invests in climate solutions.
2. The account must be FDIC insured.
3. I'm looking for around 3-4% APY.
4. I also need it to have a modern banking set up (e.g. security, encryption, decent website), since I intend to manage the money electronically.

After some Googling, cross referencing, and bugging my colleagues, I came up with four options: Atmos, Ando, Clean Energy Credit Union, and Spring Bank. Here’s how those options scored for me:

• I ruled out Clean Energy Credit Union  because its APY is only 0.15% which is lower than market. ‍
• Ando wasn't a good fit because they tie your ability to get a 5% rate to inviting friends, and that shtick is just not for me. ‍
• Spring Bank is a nice local option (it's in Wisconsin; I'm in Illinois) but its high-yield account is certificate of deposit, meaning I pay a penalty if I withdraw early. Given the whole point of this is an emergency fund, that won't do. 
• So that leaves me with Atmos. Atmos gives me a 1.75% rate and doubles it if I donate to a climate nonprofit. I already donate to a climate nonprofit, so lets make that money work!
  

Switching banks may not seem as engaging as other climate actions, but it makes a huge difference. Spending a couple hours on research is worth it to ensure that my money isn’t being used to fund fossil fuel companies. If you’re on the hunt for a high-yield savings account, it's worth seeing what climate-friendly options are out there. Here are some more options: Top 5 Savings Accounts with Sustainable Banks