Local view: Financial composting boosts growthI call it financial composting. By another name it’s known as supporting the local sustainability movement. Or even, simply, buying local. But it’s summer and gardening season, so here goes.
By: Dale Lewis, for the News Tribune
I call it financial composting. By another name it’s known as supporting the local sustainability movement. Or even, simply, buying local. But it’s summer and gardening season, so here goes.
When you buy local or use the services of a local company, more of your money stays in our community. A larger portion of your money is plowed back, in the form of taxes, salaries, money spent by the local company to buy supplies and materials, and charitable donations that come out of the company’s profits.
In fact, your money never leaves our community if the businesses you patronize also practice financial composting. It all goes back into our economy to support and help other local companies, local individuals and local organizations achieve their dreams. It makes our cities, counties and schools stronger by generating the tax revenue that pays their bills.
Financial composting makes the economic soil in our community richer so we all can grow bigger, better and stronger.
No doubt you’ve heard a version of this before, and you’ve probably practiced at least a bit of financial composing. Our community always has been aware of the importance of supporting local businesses. So why mention it again now?
It’s true the buy-local movement is taking hold here and nationwide. That’s good. But what people may practice when it comes to their restaurant meals and groceries isn’t always what they practice when it comes to other retail purchases or, in my line of work, financial services. It should be.
Financial composting makes as much sense in these purchasing decisions as it does at the farmer’s market. Maybe more. When people choose to do business with a community bank, for example, all the plow-back benefits mentioned above happen. On top of that, local deposits are used to make local loans. Your savings account helps us offer local home mortgages, local car loans and local business lines of credit.
Think of it not just as financial composting but more like financial Miracle-Gro.
At local independent community banks, we lend where we do business because we like to know our borrowers. We drive by their businesses. We spend money with them. We stop in and talk to the business owners.
They like doing business with us because they can talk to us, too. We make lending decisions locally. And we experience the same economic conditions they do. We know what it’s like to do business in our community.
As our economy slowly recovers from the trauma of a few years back, we’re all wondering what we can do to make it heal faster and grow stronger. Buying and doing business locally is one of the most important decisions all of us can make. We live in our local economy. We feel its conditions every day. When it is improving, our lives generally are improving, too.
So spend and do business locally. The local merchant you choose to patronize probably is your customer, too. Keeping her business healthy means she can return the favor — and support the church you both attend along with the hockey program in which both of your kids play.
Think of our local economy as a big community garden. The soil gets richer and the harvests bigger for everyone when we practice financial composting.
Dale Lewis is president and CEO of Park State Bank, which is based in Duluth’s Lincoln Park neighborhood.