The strapline of this blog is “Sustainable Living in an Uncertain World” but what exactly do we mean by that? The Oxford English Dictionary defines sustainable as
Capable of being maintained or continued at a certain rate or level
For something to be sustainable the rate at which it is being consumed must be the same as, or smaller than, the rate at which it is being replaced. A simple concept which can be applied to almost anything that we use. Money, food, water, oil etc.
On a global scale it is pretty obvious that a lot of modern living is not sustainable. A significant proportion of our economy is based on the consumption of non-renewable resources. Even renewable resources like timber are being destroyed faster than it is being replaced.
Personal Sustainability
On a personal level the concept of sustainability is more complicated. As we saw in the Mixing Desk Analogy there are a lot of dimensions to consider. It may not be feasible to be sustainable in all of them. Some people simply want to be financially sustainable. Ultimately, only you can decide what sustainable living looks like for you. Even within a single dimension there considerable room for options.
Financial Sustainability
Like it or not, financial stability is pretty much essential to any form of sustainable living. Even if your end goal is to go completely off-grid and live by a barter economy, there will be an initial financial outlay, and ongoing financial commitments. It is not easy to opt out of the system entirely.
The starting place for financial stability is knowledge. To get on top of our personal finances we have to begin by understanding them. What is coming in and from where. What is going out, on what and how often? Income can be harder to control than expenditure. Most of the advice about personal finance suggests that the first thing to address is debt. Do we have debts which can be paid off? Money spent on interest is money wasted, so the sooner we can become debt free the better. The second thing to look for is unnecessary expenditure. This could be large infrequent purchases or small regular ones. Old subscriptions we never got round to cancelling; things we can easily live without, areas we can make sacrifices to secure a greater good.
Only you can define what your end goal is, but once you know your starting place, you can begin to plan how you will get there.
Levels of financial sustainability
There are a numerous resources around the internet which talk about the stages of financial stability - for example this one by J D Roth. The majority of these are written from the point of view of entrepreneurs and business startups. Whilst they represent a good starting place, they tend to be individualistic rather than holistic. For us sustainability is not just about ourselves. It may start at home, but to be truly sustainable we need to look at the broader context.
The model below sets out the key stages. As with all models it doesn't cover all the nuances, but hopefully it gives a basis for understanding for the journey we are undertaking.
Level 1: Dependence
This is where most people start. You may be in debt or out of work. Whatever the cause, your financial security is entirely in the hands of someone else.
Level 2: Subsistence
The second level is Subsistence. This is just barely scraping by. There is enough coming in to live at a basic level, but it is hardly flourishing. At this level a few minor shocks can push you right back into dependence.
Level 3: Independence/Interdependence
The third level is where it begins to diverge. The conventional next stage would be to aim for Independence. The place were we have enough coming in to live the way we want and to set our own agenda. There may also be some slack to start saving. If the only people we are thinking about is ourselves this is a solid place to be. In the western world a lot a stake is set on independence. We are brought up not to be a burden on other people.
In a community context, however, we may be better of looking at the stage as Interdependence. This is potentially hard to achieve in some respects, as it means raising the level of lots of other people as well as ourselves. There are benefits of being interdependent. Not all resources need to be owned by every individual. Not every skill needs to be vested in one person. Working with others may actually make it easy for a group as whole to be sustainable. For many the route to interdepence will come via independence.
Level 4: Affluence
There are sufficient resources and to spare. In personal financial terms we have enough passive income to sustain us without the need to work. Note here, that I have divided the bar in two, as personal and community affluence may look very different.
Level 5: Beyond Affluence
The final level presents a choice. By this stage there is sufficient wealth to do with as we please. The question now is do we keep everything to ourselves and live in Opulence, or do we choose to grant money to others in a way which potentially keeps them in dependence (Benevolance) or do we seek to use our assets for the greater good (Abundance).
This last distinction is a fine one, and sometimes we may choose aspects of both. It is easy to go in with the best of motives, and still find it resulting in dependence. It can be easier to give people money than to enable them to move towards stage 3.
Bring it all together
Having understood our starting point, and mapped out the possible routes the next stage is to work out where we want to get to, and start planning how to get there. We'll look at the latter in another post.