Friday, February 29, 2008

Is your money funding genocide? What can you do about it?

What's happening in Darfur, and what does my money have to do with it?

I'm not going to attempt to explain the situation in Darfur in depth (so please read up about it yourself) but here's a short summary from the Sudan Divestment Task Force:

In response to conflict with Darfurian rebel groups in February 2003, the Sudanese government, working with Arab militias called 'Janjaweed', began sponsoring wholesale ethnic cleansing of non-Arab Darfurians, almost all of whom had NO direct affiliation with the rebel groups. Since February of 2003, over 400,000 Darfurian civilians have perished. 2.5 million have been displaced due to violence, nearly 4 million are now reliant on humanitarian aid, and 90% of Darfur's villages have been looted or destroyed. On July 23, 2004, the U.S. Senate and House of Representatives unanimously adopted a joint resolution declaring the atrocities in Darfur to be genocide.

Companies that enrich the Sudanese government help it fund the violence
-- oil companies that have partnered with the government to tap Sudan's oil resources are especially problematic because over 70% of Sudan's oil revenues go towards military expenditures. Many companies which operate in Sudan have instituted policies that recognize the situation and attempt to mitigate their involvement, but some have rejected this and those companies have become targets of activists working to improve conditions in Darfur and end the conflict.
The activists only target companies that 1) do business with and enrich the Sudanese government (mostly oil companies); 2) have no significant benefits for the well-being of underprivileged Sudanese; and 3) have refused to institute corporate governance policies that address their contribution to the situation in Darfur. They are given a chance to respond to shareholder engagement tactics before they are targeted for divestment. (Learn much more about this "targeted divestment" approach here.)

And the government of Sudan is paying attention-- nine companies have left or are planning to leave Sudan since the divestment campaign started, and the government is taking out ads and writing op-eds opposing the divestment movement. (Learn more about the arguments for the efficacy of divestment here.)

Click here for an easy screening tool that will tell you if your mutual fund holds one of the targeted companies. You can also download a regularly updated report that lists the individual companies at this link.

I support the idea of divesting from these companies in principle, but I don't want to switch mutual funds and/or I want to make a difference on a larger scale. What else can I do?

There are many ways you can get involved:
  • Vote in shareholder votes for genocide-free investing, starting this March for Fidelity. Shareholder votes around mutual funds' approach to genocide and crimes against humanity are being proposed and scheduled for a variety of mutual funds, and there will be votes for shareholders of dozens of Fidelity funds this spring, starting March 19th. Check this link for the applicable date for each fund and look out for your ballot in the mail. In most cases, the text of the resolution is:
    • The Board will institute procedures to prevent holding investments in companies that, in the judgment of the Board, substantially contribute to genocide or crimes against humanity, the most egregious violations of human rights.
  • Tell major mutual fund companies that you believe in genocide-free investing. Investors Against Genocide has a tool set up to help you e-mail that message to over a dozen investment companies-- if you're invested with them, you can send a message that lets them know that, and you can also send a general message to all of the companies. The list includes, but is not limited to, Fidelity, Vanguard, T Rowe Price, HSBC, and JP Morgan Chase.
  • Tell your state, city, university, or alma mater that you don't want your tax, tuition, or donation dollars invested in genocide. The Sudan Divestment Task Force has a great tool that lets you see what campaigns are active in certain states, cities, or universities in the U.S. So far, 22 states, 16 cities, and 59 universities have divested. If yours haven't, get involved in the campaigns or start one of your own!
  • If you're not in the U.S., check out what's going on in your country. This site has links to what's going on in more than a dozen countries, from Canada to the UK to Japan to South Africa.
How can I find more information about investing in mutual funds which make a point of avoiding genocide and try to be socially reponsible in other ways, too?

Check out this wonderful tool that helps you learn about dozens of socially-responsible mutual funds' performance, screening criteria, proxy voting policies, and more. And you can read some of my previous articles on socially responsible investing (SRI), including:
What do you think about the Darfur divestment campaign? Do you believe divesting from these target companies is a good idea? If so, have you taken any action?

Tuesday, February 26, 2008

Easy green tip: always use the revolving doors!

If you're looking for easy ways to get greener, here's one I'd never really thought about: use revolving doors rather than swing doors when you've got the option. 
A group of students at MIT calculated that swing doors cause about eight times as much outside air to enter buildings as the revolving doors do.  The building's air conditioner or heater has to process all that air, which of course uses energy. 
And while it's not a ton of energy, it's not insignificant, either:
"A single person walking through a revolving door in February saves enough energy to light a 60-watt light bulb for 23 minutes," said Wesolowski, a fourth-year Ph.D. candidate in materials science and engineering.  (MIT News)
Which means it's also the equivalent of leaving on the equivalent 13-watt CFL lightbulb for nearly two hours.  That's something I'd feel bad about doing-- now I need to think of that when I have a choice of what door to use.
And raising awareness makes a difference.  In tests around campus, MIT students also found that putting up signs saying "Help Conserve Energy, Please Use the Revolving Door" raised revolving door use from 23 percent to 65 percent.  So spread the word, and maybe even ask about putting up signs at your workplace-- tell 'em that the MIT students calculated they'd save $7,500 yearly on energy costs in just one campus building if everyone used the revolving doors!
(via Ideal Bite, who'll e-mail you green tips daily-- sign up for free!)

Saturday, February 23, 2008

The Psychology of Money: The happiest people don't earn the most

via Cognitive DailyA recent analysis involving more than 100,000 people from all around the world has drawn an interesting conclusion. In general, happier people are more likely to be successful on a wide range of measures, from income to educational achievement to personal relationships-- but on some of these measures (including income) the very happiest people come out behind moderately happy folks.

Three researchers published a journal article in December 2007 with the provocative title "The Optimum Level of Well-Being: Can People Be Too Happy?" The authors summarize it by saying:

Our analyses of large survey data and longitudinal data show that people who experience the highest levels of happiness are the most successful in terms of close relationships and volunteer work, but that those who experience slightly lower levels of happiness are the most successful in terms of income, education, and political participation. Once people are moderately happy, the most effective level of happiness appears to depend on the specific outcomes used to define success, as well as the resources that are available.

That summary seems rather even-handed about the implications of the research, but most of the press coverage has focused on the question in the title, with a conclusion that the answer is yes-- a conclusion that appears to be promoted by at least some of the authors. For example, from Newsweek:

In surveys of 118,519 people from 96 countries, scientists examined how various levels of subjective well-being matched up with income, education, political participation, volunteer activities and close relationships. They also analyzed how different levels of happiness, as reported by college students, correlated with various outcomes. Even allowing for imprecision in people's self-reported sense of well-being, the results were unambiguous. The highest levels of happiness go along with the most stable, longest and most contented relationships...

In contrast, "once a moderate level of happiness is achieved, further increases can sometimes be detrimental" to income, career success, education and political participation, Diener and colleagues write in the journal Perspectives on Psychological Science. On a scale from 1 to 10, where 10 is extremely happy, 8s were more successful than 9s and 10s, getting more education and earning more... "If you're totally satisfied with your life and with how things are going in the world," says Diener, "you don't feel very motivated to work for change. Be wary when people tell you you should be happier."

I'm not sure if there's evidence to back up this negative take on the desirability of being less traditionally succesful but ranking your happiness as a 10 out of 10. But to me, it doesn't seem like that bad a deal. Sure, if you're extremely happy you're less motivated to change things-- but what's so bad about contentment?

If people who are mostly happy make more money than people who are extremely happy, is it reasonable to assume that those who earn more but have lower life satisfaction are "more successful" and "better off" than those who tell researchers that they couldn't be happier about how their life's going? Isn't it at least equally valid to read the results as suggesting that being extremely happy is associated with a lower focus on making the most money you can?

I guess there's an argument that it's better to feel slightly less happy at the moment but also be motivated to get more education, which might help you be happier in the long term (for example, if you're extremely happy today but then you lose your job and it's hard to find a new one because you don't have a degree so your happiness falls.) And if people aren't participating politically because they're satisfied with their own life and aren't concerned about fellow citizens who're worse off, that's too bad-- but on the other hand, the happiest people are the ones who volunteer the most, which doesn't sound like selfishness to me. And the happiest people have closer and more stable relationships, which I'd consider a pretty big plus.

What do you think about these findings? Do they sound accurate to you? And what's your take on the implications? Do you think it's better to be mostly satisfied and driven to get more education and make more money-- or to be extremely satisfied and more content and complacent?

The Psychology of Money is an ongoing series that highlights some insights we can gain about ourselves and our personal finance decisions from psychological research; click here for previous posts.

Friday, February 22, 2008

Spent money abroad? Get $25 or more back!

Did you use a credit card, debit card, or ATM abroad between February 1, 1996 and November 8, 2006? Or did you pay for purchases in a foreign currency during that time period? If so, you should be eligible to benefit from a settlement of a class action lawsuit.

The lawsuit claimed that credit card companies and banks were hiding their foreign exchange fees. The settlement doesn't admit wrongdoing on the companies' part, but it does create a $336 million fund for customers who've suffered the alleged damages-- i.e., anyone who was charged a foreign transaction fee during the time period. From this article:

Although we deny any liability regarding our prior practices, the company believes this settlement is in the best interests of our customers and shareholders to avoid the inconvenience, expense and uncertainty of litigation," said Samuel Wang, a spokesman for Citigroup, which owns Diners Club.

You should be eligible to receive a refund for approximately 1% of the amount you spent, with a minimum refund of $25. If you think you spent less than $2,500, you can get a simple $25 refund. If you think you spent more, you can either provide the details of your actual spending, or get a refund based on a calculated estimate of your spending (it asks for the total number of days you spent abroad and the type of travel: business, leisure, etc-- if you are a frugal traveler, it may estimate that you spent more than you actually did!)

You can request your refund online at, or print out the forms from the website and mail or fax them in. (You may have also gotten forms in the mail from your credit card companies or banks; you can use one of those too.) The deadline for claiming your share of the settlement is May 30, 2008.

And be sure to read as much as you can about foreign transaction fees before the next you go abroad, so you can make the smartest choices! Here's a great resource for starters, although of course you'll want to double-check that the charges listed are accurate. There's only a handful of cards that don't charge a foreign exchange fee, most prominently Capitol One, as of the time I write this.

[I learned about this settlement from Philip Brewer's article at Wise Bread; thanks!]

Wednesday, February 20, 2008

The frugal fun of being a baseball fan

It may have snowed today in DC, but it feels like spring to me, because this week in Florida and Arizona there are baseball players stretching and tossing balls and swinging their bats-- spring training has arrived and the 2008 baseball season is on its way!

I suppose being a baseball fan is one of those things you can make as expensive or as cheap as you like. But I usually get tremendous fun and satisfaction out of it while spending very little.

Watching or listening to games at home is usually free if you're cheering for the hometown team. I'm not, but I still manage to get months of fun out of MLB's Gameday Audio-- I can listen all season long for just $14.95, less than the cost of two movie tickets for something that provides dozens of evenings of entertainment. There's actually something really fun and nostalgic about listening to baseball games on the radio, and I typically find that radio announcers are better than TV announcers anyway. But if you have your heart set on watching the games, you can get them over your computer for $14.95 a month or $89.95 for the season, which is not a bad deal if you're going to get a lot of use out of it.

Then there's all the side pleasures. Fantasy baseball is a fun, free pastime (and if any bloggers and/or commenters want to start up a league, I'm so in!) I'll spend plenty of time reading articles, messageboards, and blogs (a recent pleasure which skewers bad sports journalism is Fire Joe Morgan.) And hey, baseball makes for great small talk, which is no small bonus for someone as shy and awkward as me.

And of course, you can't forget actually going to games. I wrote a whole post with tips for attending baseball games cheaply, so I won't rehash, but suffice it to say that it can be really affordable entertainment, whether at the major league or minor league level. And if you live in Florida or Arizona-- or want to take a nice vacation there in February or March-- spring training is an awesome frugal option. The games are cheap, and the practices are even more fun and are free!

Of course, being a baseball fan isn't always frugal. You may be tempted to buy all sorts of apparel and paraphernalia (resist! you can do it!) And as you dutifully save your pennies by listening to games on the radio all season long, you may be nurturing a craziness that will tempt you to pay hundreds of dollars for playoff tickets should your team make it to October. (Then you've just got to make the hard decisions. It may be worth it if you can afford it; and if not, I promise the wins will be very nearly as joyful with a living room-full or barful of fellow fans.)

But baseball is one of my simple pleasures. When work and life gets hectic and stressful, it's wonderful to sink into a game where the rules and the score are clear and you can cheer hard for something that's important but not at all serious. (Does that make sense?) I get enough enjoyment out of it that it'd be worth paying a good deal of money for-- but instead I get all of that for cheap or free.

Are you a sports fan? Is it a frugal pastime for you? Do you have any tips for how to keep it affordable?

Saturday, February 16, 2008

Frugal OTC medicine: single-symptom or multi-symptom?

I've been pretty sick for the past few days, which means I'm writing about one of the few vaguely personal-finance related topics on my mind-- those lovely drugs which ease my symptoms and help me get better.

Way back on Tuesday, I went to the drugstore to pick up some cough syrup. I'd been coughing since Sunday night, without any other symptoms, and so I was standing in the aisle, trying to decide what to get. Picking cheaper generics rather than paying extra for identical brand-name items was a given. But I wasn't sure what combination to get. Cough and congestion? Cough and cold? All I had was the cough, and since I don't like the idea of taking extra drugs for no reason, I picked one that was just a cough suppressant. (Cough drops weren't an option; I totally can't stand them.)

So of course by Wednesday morning I'd started to sniffle, by Wednesday night I had a hard time sleeping thanks to nasal congestion, and by Thursday I was shelling out a few bucks more for decongestants and regretting that I'd passed up the "cough and cold" formulas the first time around-- it would have been cheaper and saved me some discomfort.

What's your typical strategy for over-the-counter medicines? Do you buy multi-symptom drugs that treat a variety of symptoms which you may or may not have? Do you buy single-symptom medications for the symptom(s) you've got, and go back later if you need more? Do you buy lots of basic single-symptom drugs so you're prepared for anything? I guess it's probably less of an issue for folks with big families (or people who know they get sick a lot), since they can stock up on all sorts of things and know they'll probably use them before they expire.

Wednesday, February 13, 2008

21 Things You Didn't Know You Can Recycle

I just came across a great Co-op America list called "21 Things You Didn't Know You Can Recycle." Of course, there were several things on the list I did know that you could recycle! But these were the highlights for me:

  • Appliances (#1): Check out the Steel Recycling Institute, which has a database of 30,000 steel recycling locations. (As with most of the items on the list, if they're still in working condition please try donating, selling, or swapping them first!)
  • CDs/DVDs/Game Disks (#4): A company called AuralTech can repair most them for you if they're scratched for just a few dollars; you can also mail them in to be recycled. Also check out GreenDisk, below, under "Technotrash."
  • Eyeglasses (#10): The Lions Club has a major program to repair used eyeglasses and send them to people around the world who need glasses but can't afford them. You can get them your used glasses (plastic or metal) via a local Lions club, many chain stores (like Lenscrafters, For-Eyes, and Pearle), or possibly other places like your local library. Call 800-74-SIGHT if you're having trouble finding a location.
  • Oil (#14): If you're one of the 50% of Americans who change their own motor oil, visit Earth 911 and use the search function to find one of the 12,000 places that will recycle the used motor oil.
    • Earth 911 is actually a really good search tool to locate nearby recycling options for a wide variety of products, including paint, which didn't make it onto the Co-op America list but was news to me!
  • Sports Equipment (#16): This is a "reuse" rather than recycle, and something you can also do through other means like Craigslist, Freecycle, garage sales, and trading with friends and relatives. But Co-op America points out the Play It Again Sports stores, with locations across the U.S. and Canada which buy and sell used kids' sports gear. You can sell, trade, or donate your kids' gear if it's in good condition.
  • "Technotrash" (#17): For as little as $6.95 plus shipping, GreenDisk will handle all sorts of electronics-related waste you've got, from electronic media (CDs, DVDs, VHS tapes, audio tapes) to batteries and chargers to MP3 players and digital cameras to computers and their accessories. Project KOPEG takes a similar but shorter list of items; you can mail yours to them, or if you can collect more than 30 items they'll cover shipping costs and pay you for the items as a fundraiser.
  • Tennis Shoes (#18): Nike will recycle your unusable athletic shoes (of any brand)-- drop them off at any Nike store or one of the other drop-off locations, or mail them. The materials get recycled into sports playing surfaces like basketball courts. (If the shoes are still usable, then donate, sell, or swap them of course! Reusing beats recyling.)
Check out the list to see the others, including batteries, cardboard boxes, clothes, foam packing peanuts, and more!

Saturday, February 09, 2008

The Psychology of Money: Sad people are willing to pay more

A study released yesterday found that participants who had just watched a sad video were willing to pay almost 4 times as much for a water bottle than those who watched a neutral video-- and yet they didn't think that the video or their sadness had anything to do with their decision.

That part of the study actually isn't news-- it backs up a 2004 study that found the same thing. The study was also looking at how much the participants were focused on themselves (self-focused), and measured it by having them write a short essay and counting how many times they referred to themselves in it (the words I, me, my, myself.)

The study found that the sad subjects were willing to pay $2.11 on average for the water bottle, compared to $0.56 on average by the neutral subjects. Their analysis also found that among subjects with low self-focus, their sadness level did not have a significant effect on what they were willing to pay, and they hypothesize that the findings are caused by the increased self-focus that usually results from feeling sad.

What I find most interesting about the study is the lack of self-awareness by the participants. Most of us are aware to some degree that when we're feeling down, we're drawn to spend more money in a conscious or semi-conscious attempt to feel better. (I've written about it here.) But this goes even further than that:

Despite the big difference, participants in the sad group typically insisted that the video's emotional content didn't affect their willingness to spend more — an incorrect assumption, said one of the study's co-authors.

"This is a phenomenon that occurs without awareness," Jennifer Lerner, a Harvard professor who studies emotion and decision making, said in a phone interview. "This is really different from the idea of retail therapy, where people are feeling negative and want to cheer themselves up by shopping. People have no idea this is going on."

So if this is a subconscious effect of feeling sad, what can we do about it? I guess one strategy would be to avoid shopping at all when we're sad, even if it's not "cheer me up" shopping we're inclined to do. Another would be to make a general effort to focus externally when you're sad, rather than dwell on yourself. But another strategy-- much more complicated and broad, but more rewarding, too-- is to try to be happier, of course! It seems to me that this is an argument against the "suffer and struggle today to save up money for a happier future" approach... if our self-sacrifice today is making us sadder, it may be undermining our efforts to be frugal even if we don't notice it, whereas pursuing happiness may help us keep our spending down.

What do you think of all this? It's kind of hard to ask "Do you think being sad has subconsciously affected your spending?" but looking back in retrospect, can you spot any of that happening? Does learning about a study like this affect how you plan your future behavior? (Personally, I'm totally fascinated by studies that uncover things that affect us subconsciously-- I really do try to keep them in mind and remind myself that my conscious perception of why I do things isn't always fully reliable!)

(hat tip to Smart Spending)

Thursday, February 07, 2008

Carnival of Ethics, Values, and Personal Finance is up at Money Changes Things!

Thanks so much to Betsy of Money Changes Things for hosting our February edition of the Carnival of Ethics, Values, and Personal Finance.  And if the great posts you'll find there aren't incentive enough to check it out, there's also a fun Girl Scout cookie theme complete with pictures!
There were some really terrific posts submitted and included-- here are a few of my favorites:

The Carnival is always up on the first Thursday of the month, which means the next edition is March 6th.  Please let me know if you're interested in hosting!  And submit your posts through this form.

Tuesday, February 05, 2008

Saving money with third-party accessories

I'm sitting here looking at my month-old power adapter for my iBook and smiling. It's been working perfectly, and it cost less than half as much as the official version that I bought to replace my broken adapter the last two times.

It came down to 1) doing my research and 2) planning ahead. The first time around, I didn't even realize there were third-party adapters. By the second time the adapter went on the fritz, I was researching to see if I could buy the official version at a better price, and found out about my other options through that process... but I didn't pull the trigger in time, the adapter died completely, and I had to run out to the Apple store and grab a replacement on the spot. But this time, at the the first signs of my adapter starting to fray, I double-checked my research and then ordered up a well-reviewed, cheap alternative, so that when the old one stopped working I had the new one at my side already.

Don't settle for the official accessories for your items without doing the research to find out if you have good alternatives that are more affordable! Do you have any other good examples of third-party/alternative items you've found that helped save money?

Friday, February 01, 2008

Test-drive ShoreBank's socially/eco-conscious bank account (now 4.15% APY)

My favorite bank, ShoreBank, has announced that as of today their $1 minimum ShoreBank Direct account has a 4.15% APY (down from 5.00%.)  I was actually expecting it to go lower, so I'm considering that good news!  It's still higher interest than a lot of big names in the high-yield savings business; EmigrantDirect is at 4.05% now, HSBC at 3.80%, and ING's 3.40%, according to Bankrate. 
A quick bit of gushing about ShoreBank for those who haven't heard me talk about it before-- unlike traditional banks which take depositors' money and lend it out to where ever they get the biggest profit (including disturbing stuff like selling cluster bombs), ShoreBank instead targets your money toward their missions of community development and a healthier environment.   This means that while you're earning interest, your money's being loaned to small businesses in low-income commmunities, builders of affordable housing, low-income homeowners, renovations to make homes and businesses more energy-efficient, and much more.  (I wrote more about them in this post a few months ago.)
When the account first became available back in October, I told you that I'd write a review of its interface, but instead there's an even better option-- ShoreBank Direct offers a free demo on their website.  Just scroll down to "To view our Home Banking Demo," click, follow the instructions, and explore for yourself!  And let me know in the comments if you have other specific questions about my experiences so far.  (I can tell you that one tiny perk I appreciate is that electronic paperless statements are the default rather than by special request; for other banks I always mean to switch over but often forget, and then watch my guilt pile up with the paper statements every month!)
Do you use a bank that supports your values, and why or why not? 
  • If you're interested in other socially conscious banking options-- including CDs and money market accounts that fund causes from international microcredit to fair trade to child care to independent media-- read more here.
  • If you're interested in mutual funds that do socially responsible investing, check out my series starting here or use this handy tool/search engine.