What is Finanacial Wellness?

By Michael Kramer

Traditional wisdom viewed financial health as a pure economic bottom line: maximize return by minimizing risk.  But history has shown that profit alone does not inherently contribute to the long-term health and sustainability of our society and planet.  Many would argue, in fact, that the pursuit of the almighty dollar has created negative social and ecological consequences along the way.

For decades, the widely accepted belief among the “haves” was that any method of generating revenue sufficed.  Social goals, then, were accomplished only with the profits.  This led to the creation of what has become a vital philanthropic sector, through which important causes could be supported with charitable contributions.

But such donations are voluntary and may reflect more of a need to reduce the tax burden or reduce feelings of guilt than create a more just or healthy society. So what if we could do more than buy away our guilt? What if it were possible to leverage adequate return while also supporting social justice and environmental restoration?  What if we could make, buy and sell things and not destroy people and the planet in the process? Would people go for it?

Well, for the past 30 years, a bold experiment has been quietly proving this theory to be true – people will go for it, even if it costs a little more out of pocket up front, because they know that you either pay now or later.  There’s no free ride; karma returns.

Not only that, but it has become profitable to make money and make a difference.

People now realize that profit is irrelevant if you can’t breathe clean air or drink clean water.  Wealth through the depletion of natural resources or social injustices is not true wealth, merely a symbol of intentional or unintentional exploitation or the illusion of a strong social fabric.  True wealth embodies the triple bottom line – economic, social, and ecological viability. All wealth, in fact, derives from our ability to utilize and replenish natural resources or cooperate with others to satisfy human interests.  People have simply become more aware of it recently.  These “care of Earth” and “care of people” ethics have slowly but surely shifted American lifestyles and consumption, giving rise to a “cultural creative” subculture that may be nearly 20% of the population.

It has become clear that some people are willing to spend a little more in order to support the triple bottom line.  Some pay a dollar for an organic turnip so as not to support the increase of toxicity in the environment.  Others buy locally-made products in order to increase the multiplier effect of money in a regional economy.  And an increasing number assure that their investments – including their life savings and retirement accounts – are aligned with their values.

This linking of money and values might seem unusual given the typical manner in which wealth is earned in our society, but it is natural to see money as an extension of the self.  Everything we spend it on reflects what we value.  Money has no inherent value, only that which we assign it, so we have complete freedom to choose how to express ourselves with each dollar in our possession.  This means we can spend it on alcohol or juice, real or plastic plants, cars or bikes, second homes or charities.  Some people are indeed choosing to live simply so that others may simply live.  Some are eating healthy and staying fit while others are couch potatoes.

An intriguing pattern has emerged since people began to see the impact of industrial capitalism on the planet: people are exercising discretion.  They are supporting issues that they care about and being careful to avoid putting their money in products and services that do not reflect who they are.  This is what natural investing is all about, integrating a personal sense of ethics or social responsibility with finance.

True financial wellness revolves around a willingness to carefully examine the flow of money in our lives, where it comes from, how we save it, and how we spend and invest it. Since money pervades so much of our existence, this thoughtful observation takes considerable effort, and it can also be disheartening to realize that we may be unintentionally contributing to injustices towards people and the planet.  But that’s exactly why assessing money in our lives is so important; we can become very intentional in managing money in our lives.  We are limited only by our attention and imagination about the strategies.

Luckily, much work has already been done to make it easier for people to change their financial habits.  The real issue is how people learn about and access these new and innovative approaches: corporate social and environmental screening, microcredit and revolving loan funds, community development banks and credit unions, shareholder activism, and the stock market for socially conscious investors.

These are exciting times, because we have positive alternatives available.  We can help to create a reality that leaves a sustainable legacy to future generations, and we can do it one dollar at a time.  On one level, there is no hurry, but there’s also no reason to wait.  Money can be a force for positive change if we wrap our hearts and minds around it and be the change we want to see in the world.  It starts with each of us, right now.

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