Budgeting for Your Environmental Ethics

The three Rs of sustainable living are; Reduce, Reuse and Recycle. Looking to incorporate this trio of principles into you daily life can greatly reduce, not only the size of your carbon footprint, but also the bills you have to meet every month.

However whilst, reducing your levels of consumption and reusing the resources you already have at your disposal will undoubtedly help to bring to down your expenditure and allow your environmetal ethics; however, when it comes to what you do buy, in many cases, keeping up a set of green credentials can become a somewhat costly exercise.

One particularly illustrative example would be organic food. Though it has its obvious benefits, by eschewing the economies of scale to be wrought by using gallons of pesticides and intensive agricultural techniques those who grow organic produce incur higher costs in relation to their output. Consequently, they’re forced to sell it at a higher price than standard supermarket fare, their more responsible methods of production leaving them unable to compete in terms of affordability.

The story is the same for a number of other products. For instance, ‘green’ energy tariffs tend to be more expensive (on top of which, depending on the provider, it is questionable just how environmentally helpful such tariffs are). Likewise, financial products marketed as bringing environmental benefits will often provide their users with lesser returns than could be gleaned elsewhere. Even goods made from recycled materials tend, quite perversely, to cost more than their alternatives.

Unfortunately, the financial cost of such choices can start to mount. This doesn’t mean you need to revaluate you lifestyle choices, though. In fact, that same code of ethics can lead you toward some profitable opportunities. By taking advantage of scenarios where it’s possible to profit from making a green choice, you can effectively budget for the expenses that that same code of ethics might generate elsewhere.

One great example of this would be energy co-operatives, especially wind farms. Despite the fact that they receive widespread criticism, both as a solution to the nation’s energy needs and as physical entities, there is no denying they make for an attractive investment.

If you’re a saver of a certain age, you’ll be all too aware of the fact that since the middle 1990’s the base rate of interest set by The Bank of England has fallen from highs of near 8% to the historically low levels of the present day (0.5%). During the same time the first co-operative wind farm, Bay Wind has offered an average return of 7.7% a year (taking into account the potential for tax relief from the Enterprise Investment Scheme.)

Given the evidential trend and the fact that demand would, logically, seem likely to keep increasing (barring some sort of future where we no longer use electricity) this seems like a much more profitable place to place your money than a savings account.

Of course, not all of us are in a place where we are able to really think about the best strategies of squirreling away money for the long haul, but that doesn’t mean you can’t make a savvy investment. There are a number of environmentally friendly one off purchases you can make that will help reduce your future expenditure. Products that will help you reduce energy bills are a great way of doing this, from insulation or double glazing, through to solar panels or more extreme examples such as ground source pumps.

Spending money in such a way can be seen as a double investment. On the one hand, you’ll reduce your monthly outgoings and, on the other, you’ll be increasing the value of your biggest asset; your home. Even if you have no intention of moving, this can end up improving your financial outlook in the short term, as being in possession of a more valuable property can make it easier for you to raise capital and gain access to credit should need be.

On a more day to day level, you can use your commitment to the environment to save money via a tactic I call ‘green leveraging’. This is where, when you’re offered an environmentally damaging freebie that your conscience inclines you to turn down, you instead negotiate an equivalent financial gain.

My favourite example of this relates to mobile phone contracts. If you’re on a contract your provider will invariably try to buy your loyalty by offering to upgrade your handset, which, as it generally involves swapping a high tech gadget in perfect working order for a newly produced, almost identical one, isn’t particularly sound from a green perspective. However, should you turn such an offer down, you’ll usually find that you can negotiate a lower tariff instead.

By grabbing hold of these opportunities to give your finances an ethical boost, you can effectively fund the choices you make where, financially speaking, that same set of principles cause you to loose out.

Will Kerr is a writer dealing primarily with the topics of green living and personal finance. You can find more of his work over at dealing with topics such as credit, insurance and investments.

5 thoughts on “Budgeting for Your Environmental Ethics”

  1. Cheryl & I have talked about this topic and have begun drawing up a list: what are the ways we can “green” our house to save money and be more environmentally friendly. Once we finish this list, we’ll knock them off based on cost vs. environmental impact order.

  2. Very much a subject I am interested in.I work on a daily basis to reduce our consumption and reuse/recycle and resell as much as possible. I put all the money made this way into my Credit Union account and find it builds up quite quickly. It also encourages and challenges me to see if I can increase this income each month, so a little side hustle which cost nothing to get started on and is now a very valuable part of my financial life.
    My next challenge is going to be deciding if there is enough spare to start making small investments somewhere, but this is something I know nothing about – any ideas Maria?

  3. Well – I’m guessing that none of us are perfect. Life on Planet Earth seems to be about compromises – whether more or less desirable. One of THE things that strikes me is there are “costs to be borne” at some point on the spectrum and the question is “Just WHO bears the costs?” – hence one of my reasons for getting my food as organically-grown as far as possible. I’m doing it mainly from my own point of view (yep….like very very darn nearly everyone – my own interests come first….ahem….but but but…something or someone somewhere would be “paying the price” if I didnt buy organic (ie the clean-up costs of chemically-produced produce). To me personally – I have to be able to “live with myself” and one of those ways is to at least try not to impose any of MY costs onto someone else somewhere along the line.

    I’m certainly “a saver of a certain age” and have all sorts of problems related to that – as to just how and where I am supposed to put my “little bit of savings” in a place where it will be safe against everything (including inflation) on the one hand and not-do-anything-disreputable on the other hand. Agh!!!! …and then, of course, theres the Disillusion Factor (ie the one that comes in the second anyone proclaims – in one way or another – “Me – I’m ever so environmentally friendly” and then one starts “counting heads” and realises they’ve got 4 children for instance and “steam comes outa the ears” at such hypocrisy from anyone who is doing more than “replacement value” number of children and trying to “salve their conscience” by stating to the World “Me – I am environmentally-friendly you know – because I do a bit of recycling”…I rest my case (whilst fully understanding they want to tell themselves “I’m so good – I am” regardless of their actions indicating otherwise). I’d rather be honest and say “I do my best…I try…but I acknowledge I’m human….” ….as I acknowledge I’ve still got a ways to go…. 

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