we hope you had a wonderful thanksgiving, friends! even if you’re reading from canada and celebrated two months ago. :-)
one of the misconceptions we used to have about frugality was that frugal people were cheap at all costs. we’d see people at the store stocking up on the most unhealthy foods or most polluting products in gargantuan quantities for rock bottom prices and think, “whoa! if that’s frugality, that’s not for us!” we even went through a couponing period (not gonna lie — it was a little extreme), but ultimately rejected that way of shopping because it was crazy time-consuming, the foods we could buy with coupons made us feel lousy, and we didn’t like the amount of food packaging that we were contributing to the landfill from all of the prepared foods we were buying. and we mistakenly thought that, if we weren’t willing to shop with coupons to a somewhat extreme degree that we could never really be big savers.
it’s easy to view frugality as all or nothing, or to see frugality as trumping other values. but it doesn’t have to.
a breakthrough idea for us was reframing how we see frugality in terms of the business term triple bottom line. as you can read on the wikipedia page for triple bottom line, it’s a redefinition of a company’s ultimate goals, most often embraced by newer social ventures or socially responsible companies.
here’s a simple breakdown, starting with the first bottom line: money.
in traditional business accounting and common usage, the “bottom line” refers to either the “profit” or “loss”, which is usually recorded at the very bottom line on a statement of revenue and expenses.
in essence, the first bottom line is: how much money are we ending up with? it’s profit or loss, which may translate for any of us into retirement savings or debt payoff, both hugely important to any solid financial plan. but there are two more bottom lines in the triple bottom line model:
over the last 50 years, environmentalists and “social justice” advocates have struggled to bring a broader definition of bottom line into public consciousness by introducing full cost accounting. for example, if a corporation shows a monetary profit, but their asbestos mine causes thousands of deaths from asbestosis, and their copper mine pollutes a river, and the government ends up spending taxpayer money on health care and river clean-up, how do we perform a full societal cost benefit analysis? the triple bottom line adds two more “bottom lines”: social and environmental concerns.
when we think about our values — not just our money — and what we want our contribution to the world to be, the top three that rise to the top again and again are:
- achieving the financial freedom to see the world and expand our horizons (money)
- using our privilege to help people, and to ensure that our purchases don’t support oppression (social)
- not trashing the planet, using more than our share of resources, or harming our health (environmental)
for a long time, it seemed like these values were at odds with frugality, or at least the second and third felt that way, and so we kept obliviously blowing our paychecks… again, that all-or-nothing thinking. if the cheap processed food at the discount grocer violates #3, then it must be fundamentally at odds with #1, or so we thought. but we finally realized that they don’t have to be at odds at all, and that realization helped us shape what we think of as our triple bottom line approach to the “business” of our life.
realigning those top three values as bottom lines, we get as our triple bottom line:
- money saved (achieved through frugality and increasing our earnings)
- people helped or not oppressed (achieved through volunteering, donations and not supporting stores or companies that don’t respect their workers)
- environmental and health impact (achieved through minimizing our purchases generally, making choices with the smallest impact, minimizing packaging and garbage as much as possible, and choosing organic, unprocessed foods most of the time)
our new model actually happens to align pretty perfectly to a business triple bottom line model, which made us think: shouldn’t everyone go through this exercise and figure out what they want to balance in their own lives, so that their finances are never at odds with their values?
because, ultimately, we not only want to save money, we also want to be able to sleep at night, and to know that we stand for something. for us, if we do all of our shopping at stores that might save us money, but which fill our bellies with unhealthy processed foods and fill our garbage can with a huge excess of packaging, we will never be happy. and that’s what this push toward fire is all about, right? happiness? so let’s all agree not to undermine our happiness by letting money trump what we hold dear in our hearts!
here’s a concrete example. we all love fresh salad greens, right? and the stores make it so easy these days to just toss a big plastic box of baby kale into your cart. knowing that we want baby kale, we have several options to obtain it:
- buy the absolute cheapest volume of it at the discount grocery store in a thick plastic container (pro: cheap. cons: workers get paid peanuts, kale unlikely to be organic, and kale comes in a plastic box that’s unlikely to be recycled, even if you put it in the recycle bin.)
- buy a similar bin for slightly more at the natural grocery store (pro: workers paid better, kale likely to be organic. con: more expensive, still comes in plastic.)
- buy the kale from a loose bin, using reusable produce bags, at the natural grocery store or farmers market (pro: workers paid better, kale is organic, no packaging. con: a little more expensive.)
using our triple bottom line model, it’s pretty easy to see that we choose option 3. yes, we pay a little more, which is hard for someone focused solely on frugality to swallow. but for us, thinking about the triple bottom line instead of just absolute price gives us the best ratio of pros (3) to cons (1), as opposed to the inverse ratio in the rock bottom cheapest option. of course, paying attention to the triple bottom line doesn’t mean not caring about price — you can still care deeply about price, and do all of the same comparison shopping, and find the best deal — but do so in the context of ruling out any deal-breakers for you.
while this post isn’t meant to be a lesson just for cyber monday, it is another good example of balancing multiple values, not just price bottom line. so while we might save a buck or two on products ordered online today, we’ve significantly cut back on what we buy online because we’ve gotten sick of receiving huge piles of cardboard and plastic whenever we order something from amazon (really guys? you needed to put that box inside another just slightly larger box? or use a giant box and a million plastic air bubbles for one tiny thing?).
it always comes back to happiness and peace of mind — finding what it takes for you to have those. if all you care about is the balance on your ledger, then you have some easier decisions, and can buy on price alone. nothing wrong with that! if, however, you’re like us, and basing decisions on price alone doesn’t quite sit right with you, then we highly recommend doing this exercise to figure out your triple bottom line, and aligning your choices moving forward with your trifecta.
how do you balance your money goals and your non-financial values? have you ever thought about frugality in terms of triple bottom line? please share!