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How Being Green Makes You A Wealth Building Machine

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.


Why this matters

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.


Where we live

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.


How we get around

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.


What we fuel ourselves with

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.


Running the household

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!


Entertainment and spare time

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.


Clothing and other stuff

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!).


Some thoughts on buying ‘green’

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.


The ‘why’ behind frugality

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.


Final thoughts

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…


31 Replies to “How Being Green Makes You A Wealth Building Machine”

  1. When I found out that plastic was made from petroleum, I decided to try and use every plastic bag/zip lock bag at least twice – it takes 2 seconds to rinse them clean – and to hugely minimise my use of Glad Wrap by saving leftovers in the fridge by putting a plate over them, instead of using cling film.

    I have a veggie garden out in the back yard and I’ve just planted an ‘orchard’ in the front yard with 10 fruit trees. $ of these are columnar apple trees that will go along the driveway. They just grow upwards, not outwards, and the apples are delicious.

    I think that tailoring your home to be a place where you’re happy to be in is a hugely frugal thing to do. I’m retiring in 8 weeks and I’ve spent the last couple of years putting in the veggie beds, painting and generally doing things around my home to make it The Best House in Melbourne. I have hobbies that I can do quite happily all day without ever having to leave the property – except to walk the dogs on the beach, of course!

    1. Nice work, we’re forever re-using things like that too. Often use paper towel to cover certain things instead of plastic.

      Apple trees dotted along the driveway sounds fantastic! Haha the best house in Melbourne, love it 😉

  2. We are getting a 10.5 kw solar system installed this month. We’ll be saving at least $55k over the next 25 years (excluding any rebates) . Win win for our budget and the environment.

  3. Hi SMA

    Thanks for all of your great content!

    Totally agree with you on this topic and we try to do our best, but we’re definitely not perfect.

    One thing I’d like to add is that the often in environmentalism, it’s about what I can do to effect change. This YouTube video discuss individual vs systemic changes that are required to tackle climate change.

    Furthermore its been the marketing strategy of fossil fuel companies that consistently attempt to shift the onus back into the consumer. The Drilled podcast goes into detail through their investigations.
    The easiest example is green washing is from the crying Indian ad.
    Sponsored by fossil fuel companies.

    Again I don’t abdicate personal responsibility, but government and thus commercial is even more important.

    1. Cheers Mungbean. You’re right, it’s not just us, policy and bigger players can make a huge difference. My issue with focusing on things like that is it typically creates a lot of frustration for people without a lot of tangible things they can do about it right away, short of emailing politicians etc.

      I do think things are heading in the right direction, fossil fuel companies are inevitably dying and certain technologies can help things improve. But people also have to start looking at their own choices, because what I see is very little personal responsibility being taken – far easier to push the blame onto a faceless corporation or government. Both sides matter though.

      As I mentioned in my post on the future of FI, the world will change simply due to economic benefits, whether they give a shit about the environment or not. And that’s great news.

  4. Hi I am new follower of this page. Thank you for writing it is great.
    We have solar panels installed on our roof in Sydney and feel great that we help the environment and also cut costs exactly like what you say.
    Lucky to live in Australia to have these things good to be grateful about that. I am from India with not much opportunity to look after environment.

  5. Loved this post! Sir David Attenborough has another documentary that just came out on the Aus Netflix called A Life On Our Planet which covers some of your points!Totally agree with all of this. We try to be as green as possible. We’re both on a vegan diet, try to make our own stuff eg. Deo, soap etc. (which btw saves a butt tone of money), bike to and from work, and eating local where possible. Have you thought about investing in ethical ETFs?

    1. Awesome, thanks! I have considered ethical ETFs but there are a few problems with them I think. For me, the main one is that trying to avoid certain shares actually doesn’t really hurt the profitability of that company. So I can have much more impact on their bottom line by avoiding products I don’t want to support.

      The other challenge is on deciding how far to take the ‘ethics’ angle. We could easily argue banks aren’t ethical, nor are large supermarkets (they screw farmers), or mining companies, and so on. See where I’m going? So it’s kind of a never-ending game of whack-a-mole. I’ve decided to simply invest in the whole basket for now.

  6. Less impact on the earth and frugality/money saving definitely go hand in hand, good article! On the back of all the above life changes & money saving you also have to think about how that might impact your investments overtime. Whether you move to ethical investing ETFS or chose not to invest in certain companies that might well fade into oblivion as the world (fingers crossed) goes green.
    My downfall is travel (obviously not this year) but I try to avoid internal flights once we get to a destination and take public transport etc. (Plus so much walking).
    I figure I’m not having kids so that also helps the environment (a controversial topic not covered) but more people means more resources. Besides kids, pets do also have a financial and environmental impact, especially as they are normally meat eaters, my pooch loves kangaroo which has a much lower environmental impact than beef.

    1. Great comment Brenda. I have no issue if a small % of my companies go to zero as those companies doing damaging things eventually die. But maybe they transition into other businesses which are cleaner, then maybe they survive, which is okay too.

      Haha yes the kids thing. It’s hard to talk about that without things getting wildly emotional. Pets are much lower impact, but yep they totally have a footprint too. We feed our dog fish rather than land animals and the vet is always impressed at what great condition he’s in.

      It’s funny, when you point out that the bulk of our choices are optional (pets, kids, travel, etc.), it doesn’t go down well with most people lol. Not that we shouldn’t do these things, but that they should be well reasoned choices, not just ‘cos we feel like it’.

  7. So true. I’ve always said saving money, saving the environment and being healthy often all go hand in hand. I tell the kids this when we ride to school, or buy second hand.

  8. Funny how no one ever considers the full life cycle of solar panels and what goes into make them. Especially large scale solar, if ur worried about land clearing.. it is terrible.

    1. See SatayKing’s comment, panels will be recyclable. Of course, there are resources that go into making them, but I think the benefits outweigh the costs there. They get more powerful and efficient with every couple years that passes, meaning more energy for the same resources.

      Large scale solar takes up a lot of space, yes, but again, I think the benefits are worth it. Raising cattle for food is simply a dietary habit we’ve become accustomed too, it’s not actually necessary. So if the land is cleared, I think it’s obvious that the space getting used to create clean energy is FAR better for the environment than it is for raising gas-producing cows.

  9. An element which is often overlooked, mainly due to cost, is double glazing of homes including existing ones.

    I have been in a friend’s home when it has been in the high 30C’s. They had installed double glazing as well as ducted recycle air conditioning. The thermostat was set to 28C but the thermometer showed the inside temperature was 24C and remained there for the day. Very pleasant plus it had the impact of subduing external noise.

    They also had two 5kW solar systems (6.6kW nominal) so were able to claim the feed-in tariff on both systems (in Canberra it’s limited to 5kW for single phase even if a 10kW inverter is installed.) Their total outgoings on energy for one year was $65.

    They also waited for their hot-water system to breakdown before a solar one was installed as the hot water cost was only $230 pa for off-peak and it wasn’t worth spending over $4.5k on solar to save $230. They then reasoned they would have had to spend about $2k to replace the existing hot water with the same so went solar hot water. As there are only two of them in the house and a 300 liter tank was installed, their hot water needs are so minimal they don’t have the electric boost on even in Winter.

    1. That’s a good one SK, hadn’t thought of double glazing (other than on donuts of course) 😉

      Thanks for sharing mate. Sounds like a damn good setup!

  10. Gumtree is my best friend. I try to buy second-hand stuff where possible. Doesn’t work all the time of course.
    Over-population is probably the single biggest challenge we face. There are too many humans on the planet. It’s a difficult topic for sure but an ever-increasing and ever-demanding human population is just not sustainable. I don’t have any easy answers here… Nobody does, but overpopulation is a topic worthy of consideration for all of us.

    1. Nice work Jeff. Must admit, I’m a very lazy shopper most of the time.

      The population thing is a challenge for sure. But from what I’ve read, global population is expected to peak later later this century. Typically as societies become wealthier, they have less and less children. So as developing countries evolve, population growth should slow down markedly and then start falling (as many developed countries are in decline without immigration) which is good news.

      In Attenboroughs doco, they actually say that the population is sustainable, but our consumption is what’s doing the damage. So that is the real challenge I guess. Reducing our footprint, without reducing our quality of life. And as we’re getting more examples of now (hopefully this blog is one of them), that’s totally possible 🙂

      The land use thing is a concern, but I’m hopeful about the future of ‘vertical farming’ and what could be done there. Far less space used, less water, less cost, no chemicals, locally produced perhaps.

  11. I think ‘crap-ton’ needs to be recognised as a legitimate unit of measurement!

    Re the car thing, there is a (slowly) growing industry around car-sharing. For example, Go Get have been working with apartment buildings to provide a small pool of cars that are garaged in the building for the use of the people living there. This would probably also work well in gated communities or blocks of townhouses or retirement villages. Membership of these car-sharing companies is usually pretty cheap (around $5 a month) and you pay a fee per kilometre of use. Much more cost-effective than owning a car! I hope to find a nice place to retire to where I can give up being a car owner.

    1. Haha 😉

      That sounds like a great idea, hopefully that rolls out in more places. Very cool, thanks for sharing.

  12. Paying as a Patreon (sponsor) of a researcher and YouTube blogger for planet sustainability, which keeps me learning about current and future technology and lifestyle trends, and this in turn has positive returns. Hopefully this can level the field somewhat from the many commercial interests, as well as how to avoid potential traps.

  13. Great post! We should all be doing our part to preserve this great planet while we can.

    I’ve included in my personal blog an electricity retailer comparison tool which separate the cheapest plan, green plans and GreenPower plans so people can be more aware of products that are more environmentally friendly.

    People may think this can’t done with electricity but you definitely can. Like you said, by supporting retailers (businesses) who have their own solar farms (instead of the coal power plants) i.e. doing the right thing you are voting with your wallet and more of the power from the grid can be generated from a renewable source in the future.

    Always loved reading your content, keep it up!

  14. Great post Dave and you are getting a little more MMM by the day… I particularly liked your comment about “thoughtful” spending. You’re essentially saying that you don’t have to go without, just think before you buy.

    Alas, as another poster mentioned here I completely agree our problem is our population. People are delirious if they think that technology will enable every single person on the planet to live a first world lifestyle. We simply aren’t that advanced. The more and more people that become wealthy on this planet, the more our living standards will gradually decline. On the bright side though, I also completely agree with you on the point that our lifestyles today are super duper luxurious, so a little decline in living standards doesn’t necessarily mean disaster – although for some people it would seem like it! My first home and where I still live today is a unit and the amount of people that looked down on us because we didn’t buy a house with land still haunts me… Some people look at us with pity and that we are poor because we live in a unit. It was the best I could afford.

  15. I agree with all written here, and have made many of these changes myself. I’ll add one thing though.
    Australian Ethical has a interesting online carbon footprint calculator:
    If it is to be believed then, for the FIRE community especially, the impact of our investment choices far outweighs our consumption decisions. In my case it calculates that 92% of my annual CO2 emissions arise from my investments. I’ve done some research into this and the whole area is very murky. But there is definitely a case to be made that if we are genuinely committed to a sustainable lifestyle then we should be applying an environmental sieve to our investment choices. Interestingly, since I started doing this my ‘ethical’ investment have been outperforming the standard index funds.

    1. I’ll check that out Adiran, thanks. I’m a bit skeptical of that to be honest… just because some ‘shitty’ companies are included in an index, that does not increase our personal footprint, that’s complete bunk and doesn’t pass the common sense test. And the website has a vested interest in telling us such things.

      I’m not saying we shouldn’t care or ethical investing is bad (it’s obviously a good thing with great intentions), but it doesn’t have the world-saving impact that is implied from the marketing and what people would like to believe.

  16. Very informative and detailed article with actions and benefit analysis. I liked it. By the way I agree with you.

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