October 30, 2020
According to my website statistics, approximately 100% of this blog’s readers live on a tiny blue speck we like to call Earth.
This means, until Elon Musk has helped us set up shop on other planets, we’re not very diversified! So it’s kind of important how things turn out for this rotating mass we call home.
Luckily, dear readers, I have good news! Much of the choices we make that are better for the Earth, also help us save a crap-ton of money in the process.
And here’s the best part: we get to keep living our wonderful modern-day Aussie lives. No extreme behaviour required! 😀
It’s simply another way to play the best optimisation game in the world. You know, the one that results in your freedom in 10-15 years, allowing you to step off that glorified hamster wheel and start living a free and self-directed life.
It turns out that when we reduce waste, make more efficient choices and avoid unnecessary consumption, it creates a huge difference in outcomes, especially where our finances are concerned.
This is nothing new, of course. People like Mr Money Mustache (one of my personal heroes) has been spreading this message for years.
And recently, another hero of mine – Sir David Attenborough – made a documentary about this very topic, called Extinction. Currently it’s only available in the UK, but I managed to watch it on YouTube (though I think it is not longer available).
As you’d expect from the great man, it was gripping to say the least! I can’t wait for it to reach Australia so more people can watch it.
But even if you don’t care about the environment, you definitely care about your wealth. And as you’ll soon see, these two concepts are incredibly intertwined.
This article breaks down exactly how and why being green makes you a wealth building machine. (Yes, that’s a bit lame, but hey – it rhymes) 😉
By the end, we can all embrace the win-win opportunity in front of us, and move forward with fine-tuned decision making skills, all while feeling pretty damn good about what we’re doing and becoming financially independent at the same time!
Alright, let’s get stuck into some concrete examples of what I’m talking about.
Our housing situation is the first one that pops out at me when thinking about our global footprint. The less space we consume, the more that’s left for nature to do its thing.
Now, this doesn’t mean we have to fit 3 kids and a dog into a studio apartment. It just means we should evaluate how much space we really need.
This might surprise people, but on average, Aussies have the biggest homes in the world, despite there being less people in each house than in the past. There is, quite literally, plenty of room for improvement!
Apartment dwellers are off the hook here. You’re making up for those of us living in 3 or 4 bedroom houses with only a couple of people occupying the space (yes, that’s the SMA household too!).
In the future, I’d like to reduce our home’s footprint. Of course, this needs to be balanced with Mrs SMA’s love of gardening.
Does this even matter? Well, yes. Ultimately, developers try to build what people want to buy. If there’s a cultural shift to smaller spaces and less bedrooms, they’ll change what they build and how much land is allocated to each property.
But if we all just accept, “Yeah, houses are big and come with all this extra space and rooms we hardly use, but that’s okay,” then nothing will change.
Action: Take up less land if possible. Optimise the space you currently have. Minimise empty bedrooms. Consider renting out the extra space you do have for maximum efficiency.
Benefit: Lower council rates. Lower ongoing maintenance. Lower heating/cooling bills. Less resources needed to build, repair and improve the property over time. Possible extra income.
This is probably the most obvious one!
How we transport ourselves from one place to another has a huge effect on the environment (air pollution anyone?) and our wealth, with car ownership being a bigger sinkhole of cash than most people realise.
This doesn’t mean you shouldn’t own a car, although if that’s you – nice work! But choosing a fuel efficient vehicle is the first baby step towards burning up less fuel. And getting rid of the $30,000 SUV (or worse, the $100,000 Range Rover!) and replacing it with a more sensible small vehicle is how you do it.
Beyond that, of course, we can minimise our driving time, use public transport (it’s running anyway!) and simply spend more of our free time doing things locally. If there’s nothing good to do nearby, and the shops are too far away to walk or bike, that’s a sign you should consider moving house.
Action: Get a smaller car, or go car-free. Use public transport. Walk or bike more often. Spend time doing local activities.
Benefit: Lower transport costs. Savings working harder. Lower emissions. Healthier and more enjoyable lifestyle.
The stuff we eat and drink has a large impact on the planet, and our wallet. This has become more obvious to me in recent years, after changing my diet and also becoming more interested in the environment.
Half of Earth’s habitable land is used for agriculture, most of which is dedicated to meat and dairy. Incredibly detailed information on this topic can be found here. Sadly, continual land clearing for cattle grazing has led to a huge loss in habitat for countless species of animals and insects.
Luckily, there are some positive trends unfolding. From technology helping increase yields for current cropland, to scientists working on nutritionally identical meat-alternatives, and people increasingly adopting a more plant-based diet.
As is now quite obvious to most people, your body doesn’t magically fall apart if you don’t eat meat. In fact, you’re likely to live a longer, healthier life eating a mostly plant-based diet.
As mentioned in my ‘Frugality & Food’ article, we moved to a mostly vegan diet about 4-5 years ago for ethical reasons. We feel better and our grocery bill is much lower than before – both were unexpected benefits. If you’d like to make a change but not sure where to start, try this guide.
Another seemingly strange idea is to slightly reduce your portion sizes. Unless you already have a lean muscular physique, most of us could do with losing a little fat (myself included). This has the side effect of reducing food waste and cost.
You could also consider Australian grown food where possible, to reduce the transport miles involved in your meals. And finally, aim to minimise takeaway food to avoid the wasteful bags and disposable packaging that come with it.
Action: Eat less meat and more veg. Cook mostly at home. Try growing some herbs or vegetables. Slightly reduce portion sizes, minimise waste. Use locally grown food where possible.
Benefit: Less land and water used. Longer lifespan, healthier body. Lower grocery bill. Less food to landfill. Kinder to animals. Less transport emissions involved in each meal.
Okay, so those are the big three areas of spending. Now we move into the other smaller, but still very impactful, categories.
The resources we use and consume inside our homes also make a difference. Where our electricity comes from, how much we use, as well as gas and water. And while it’s only common sense to use these things in moderation, there’s more than just our bills to consider.
As it turns out, burning tons of coal for electricity isn’t that great for the planet. Fortunately for us, Australia is one of the best places in the world for generating solar power. So, the more people that power their homes (and eventually their vehicles) with solar power, the better off we’ll all be.
This means you still get to enjoy the glorious benefits of using electricity, while reducing some of the negative outcomes. No need to head off to bed at 7pm!
Action: Use water, gas and power carefully. Get solar panels if you can. Use energy efficient lighting and appliances.
Benefit: Less emissions, and much lower bills!
We can even make better choices for the planet and our wealth in how we spend our free time.
If we decide the only way to enjoy ourselves is to travel around the world and indulge in retail therapy, well, I have to say, you almost couldn’t design a more destructive, and ultimately, less fulfilling way to spend time.
On the other hand, if we focus more on locally focused activities, which require little in the way of travel or spending, we get the best of both worlds – satisfying and Earth-friendly!
This doesn’t mean you won’t travel or buy stuff. It just means these things end up far down the priority list, where they should be.
Action: Hanging out with friends. Enjoying time at our great parks or beaches. Exercising and being active. Working on our hobbies, creating or fixing things. Volunteering or helping others.
Benefit: Lower carbon footprint. More fulfilling activities. Feel more connected with your local community. Less spending, effortlessly.
Since humans have evolved for a need of clothing to stay warm, we end up with a big pile of clothing we rotate through and replace over time.
Unfortunately, this activity of updating our clothing and gadgets has turned into a game for many. Every year, we toss out the old items and get a fresh consumer high by bringing home a bunch of new stuff. This can be applied to clothes, gadgets, appliances – basically, everything.
Not only does this create an enormous amount of landfill, but the production of these items also creates large amounts of pollution and resource consumption. Our need for clothing and love of technology isn’t going anywhere – so what can we do about it?
Action: Get your entertainment and positive feelings elsewhere (see above). Keep current clothes and technology longer. If it still works, don’t replace it.
Benefit: Less factory pollution. Less resources used. Less landfill. Huge cost saving from buying used phones and appliances. Huge environmental benefits from used clothes (I need to up my game on this one!).
I love the idea of people buying ‘green’ products. Things that were sustainably produced, using recycled materials or items that are generally just more efficient.
Sadly, this has turned into a bit of a marketing gimmick (as with anything that gains popularity). Now, advertising is trying to convince us to replace what we currently have, with ‘greener’ options.
Well, doesn’t that sound all sweet and lovely? The problem is, if we don’t actually need to replace what we currently have, then we’re actually doing more harm than good.
Why? Because buying green products is more destructive than buying no products. Good intention, wrong action.
Almost always, the best approach for the planet and your wealth, is to simply not buy things unless you truly need them. Check out tons of simple actions you can take in this article: 50 Ways to Help the Planet.
Most readers of this blog are interested in increasing their wealth and freedom. Some embrace frugality with gusto, others less so.
But no matter our motivation, there’s one fundamental reason to embrace a healthy level of frugality: The Earth.
Because when we approach our spending decisions with our planet in mind, it’s coming from a place of love. For the other species and creatures that share this space too. For your children’s future and their children’s future. And for the sake of preserving the prosperous world we currently enjoy.
Frugality is not about finding the cheapest option to save money. Frugality is about thoughtful spending, and considering the impact and trade-offs of our choices. Financial Independence is achieved in exactly the same manner.
Hopefully this article has shown how truly aligned these two goals are.
One of my personal goals is to figure out ways to consume less over time and have less impact on the Earth. Not for the financial benefit. But because it feels like the right thing to do.
I strongly believe we can all continue to lead great lives while treading more lightly on the planet.
As mentioned in my post –The Future of FI – technology looks set to make many of the above things cheaper and cleaner (transportation, food, etc.) over the next ten years, lowering our cost of living. But we can and should play our part also.
As we begin to make more considered choices, this creates the double-benefit of being much better for the environment, while also being incredible for our personal finances.
What’s one thing you could do to create a double-win for the planet and your wealth? Share your ideas in the comments below…