Seven golden rules for more positive personal finance

Written by Rebecca O'Connor on 9th April 2016

Responsible investing is becoming more popular, as more of us begin to question whether our money is a force for good in the world and realise that there is not necessarily any financial sacrifice involved in making more positive personal finance decisions.

If you are more Mrs free range organic, recycled denim and eco resorts, more Stella McCartney than Ivana Trump and more Tesla than Range Rover, your money might need a favicon Good makeover too (and you can get one by emailing us using the form on this page!)

Start here.

Seven golden rules:

Avoid the big banks: Barclays, HSBC, Lloyds, Royal Bank of Scotland, wherever possible.

Avoid the big six energy providers: British Gas, E.ON, EDF Energy, npower, Scottish Power and SSE, wherever possible. Ecotricity and Good Energy are the doyennes of renewable providers, but there are other green options, such as M&S Energy.

Don’t pick investments on their return potential alone. You can find out about how responsible funds are using Morningstar’s ESG ratings. Remember your three Rs: risk, return and RESPONSIBILITY. Don’t be satisfied with bland funds someone else has picked for you – the danger with new low cost, convenience-first fund platforms such as Nutmeg and Moneyfarm.

Don’t rely on price comparison sites to make your choices. We all love a bargain but the cheapest is rarely the best all round product (for people and planet as well as your pocket), whether you are choosing insurance or a mortgage. Repeat: there’s more to life than price, there’s more to life than price.

Choose the “three Ss”: “sustainable, social, smart” for your savings account, which should have a responsibility policy. Providers such as Triodos, Charity Bank and Ecology Building Society are a good place to start. But generally speaking, building societies, which are mutually owned, and local credit unions, which lend to local people using the savings of other local people, can be a good alternative high street banks.

Use the power of your pension. A lot of money tied up for your retirement is tied up into oil, gas and the dependent on some of the world’s baddest big companies. Share Action the campaign group, can help you put pressure on. Your pension provider should be able to give you a breakdown of companies that the fund invests in. It may be worth moving your pension if you aren’t happy, but there can be financial implications for doing so. Consider setting up your own pension alongside a workplace one.

Customise your cash. The growth of alternative finance – crowdfunding and peer-to-peer lending, means there are all sorts of ways you can support things you believe in and get a decent return. Abundance Investments specialises in lending to renewable energy projects, which Crowdcube, Seedrs and Crowdfunder all list ethical projects and businesses that allow you to make your money better reflect who you are and what you care about. Ratesetter and Zopa take out the banking middleman so you can lend straight to individuals.

Check out the Good With Money resources too:

Read the Good With Money guide to better stocks and shares ISAs.

Find a Good With Money current account that is not with a planet-destroying big bank.

Find an energy provider that is not more expensive than the Big Six but also doesn’t emit CO2 with the results of this Good With Money investigation.

Put your savings somewhere lovely.

Take out insurance from a nice provider.

Read some blogs on ethical alternative finance options.

… Now, your financial impact is as angelic as the rest of you 🙂