April is Move Your Money Month, but around here we celebrate it all year round.
Lately it seems like we don’t have that much control over so many factors that affect our lives and futures.
But remember: OUR MONEY IS OUR POWER! Every dollar we spend, save, bank, share, or invest has impact. Keeping your money close means those dollars can have many positive effects as they move through the local economy.
So: your money = your vote. By moving your money from Wall Street to Main Street, you’re casting a vote to empower your neighbors and community — instead of enriching big, greedy, distant corporations.
If you’re looking for inspiration, here are four ways to Move Your Money for Rhode Island
1. Bank local.
Choosing a local bank is one of the easiest ways to support our local economy. Thinking locally is about investing in your community as a whole, and that starts with where your dollars are deposited. Community banks and credit unions are embedded in local communities, rely on strong customer relationships, and understand the needs of local people, businesses, and markets.
When you bank local:
- You’ll get the same great services for lower costs. Most locally owned banks and credit unions offer the same services at lower costs than big banks. According to national data, smaller banks offer lower average fees, better interest rates, and better terms on credit cards and other loans. They opened to serve local residents and businesses, providing services that people otherwise wouldn’t have been able to access. And they’re staffed by people from the community, which results in personalized attention.
- Your money will be put to work supporting the local economy. Small businesses depend on local banks for financing, especially in moments of crisis. Although small and mid-sized banks control less than one-quarter of all bank assets, they account for more than half of all small business lending. The largest 20 banks control 57% of all bank assets but devote only 18% of their commercial loan portfolios to small businesses. During COVID-19, community banks provided 60% of all PPP loans, 72% to minority-owned businesses.
- Like you, local banks are invested in the prosperity of the local economy and community. Big banks are not connected to the places where they operate, and they often use a community’s deposits to make investments in other places. Local banks prosper when local communities prosper. Small, local banks want to turn deposits into loans and other productive investments. Big banks devote a sizable share of their resources to Wall Street bets that may generate big profits for the bank but offer little economic or social value for the rest of us. And as we’ve seen, if they go bad they put the entire financial system at risk.
- Decisions are made locally. At local banks, loan approvals and other key decisions are made by people who live in the community, have relationships with their customers, and understand the local needs. Because of this, they often approve small business loans that big banks would reject.
2. Join a credit union.
Credit unions are financial institutions that offer the same kind of personal and commercial services, but joining a credit union is about more than being a customer. Credit unions are owned by their members. Member-owners vote and help make decisions that respond to their wants and needs. Big banks, on the other hand, are owned by shareholders — who usually vote according to money and profits.
3. Use cash not credit.
When you use your credit or debit card to pay for a service or product, the business does not receive the entire payment.
For example, let’s say you pay $20 for a haircut. If you pay with cash, the barber receives exactly $20. But if you use a credit or debit card, there’s a processing (or “swipe”) fee around 2.5%, which means the barber makes $19.50. That may seem like a small amount, but it adds up, particularly over time and across customers. Ultimately, swipe fees result in higher prices for consumers and lower profits for businesses.
Consider the facts:
- Small businesses report credit card fees as their second highest expense (after payroll).
- American businesses pay 7 times more than European businesses in swift fees.
- For the average American family, swipe fees increase by $1,000 the annual cost of food and goods.
- Credit and debit card swipe fees totaled $187.2 billion in 2024, a record high, according to the Merchants Payments Coalition.
- Visa and Mastercard control 85% of transactions and took in a whopping $111.2 billion —an increase of more than 10% from 2023.
- Just four banks — Chase, Wells Fargo, Citi, and Bank of America — issue half of all credit cards, which means they get a cut of each swipe fee.
- The credit card industry and big banks spend millions lobbying Congress against regulations mandating competition.
By paying with cash, the local business owners get all of your money, and you don’t have to hand any over to the credit card monopoly.
4. Invest local.
Many of us have money invested in Wall Street through stocks and bonds. For most people lucky enough to have retirement savings, our future depends on a portfolio of investments into companies we don’t know well and industries we can’t understand — companies and industries that don’t know (or particularly care about) Rhode Island.
Instead of putting more money into Wall Street, consider opportunities to invest into ventures in your neighborhood. Community investing creates a community asset which helps to produce and retain social benefits and financial profits in our community!
The Rhode Island Community Investment Cooperative has launched a direct public offering for the Local Return Diversified Community Investment Fund (DCIF), nation’s first DCIF and Rhode Island’s first-ever community investment fund, which will invest in local real estate projects and related ventures that create or preserve local ownership and economic activity. With a $3.5 million fundraising target, the Fund will invest in locally-owned, community-driven real estate projects and small businesses.
And you can be an investor-owner for as little as $2,500 ($500 for people who meet the low income qualification). Find out more.
