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Why Sustainability Is an Important Personal Finance Principle

  • April 8, 2021

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When it comes to ensuring that your financial life is as stable and optimal as possible, there are a variety of different practices that are important to keep in mind.

Budgeting using an adaptive system, for example, is pretty much a prerequisite – and that’s a big part of the reason why tools such as YNAB have become so popular.


At the same time, though, perhaps one of the most important personal financial principles to keep in mind is sustainability.


Often, sustainability is thought of purely in terms of recycling and renewable energy, such as choosesolar. Here, however, are some reasons why sustainability is an important personal finance principle as well.


Because living beyond your means will cause financial mayhem, no matter how much you earn


First things first, you need to live in a sustainable way – with regards to maintaining a sustainable balance between your income and your expenses – in order to actually enjoy any degree of financial stability or success whatsoever.


Crucially, living within your means is a prerequisite regardless of your income bracket. Even if you were exponentially increasing your income every year, it wouldn’t matter if you were also increasing your expenses in the same proportion.


In fact, if you view “wealth” not in terms of the total amount of money you have, but in terms of the amount you have that isn’t tied up or committed to other things, it is possible to begin living in a “wealthy” way even on a modest income.


Because your ability to save relies on sustainable and consistent practices over time


Saving, in and of itself, is at the heart of any form of future financial planning, including big life milestones – such as taking out a mortgage on a home.


Saving successfully, however, also relies on your ability to maintain sustainable and consistent practices over time.


If one day you are putting a certain proportion of your income aside for a particular savings goal, and the next day you completely change your plan around, and then the day after you go on an unplanned spending spree, you will simply never have any realistic prospect of achieving your financial goals.


Emphasising a sustainable and harmonious approach to your personal finances can, ultimately, make all the difference.


Because you want to create an optimal lifestyle, not just to reach a specific milestone


Sustainability might not be such an important principle to keep in mind if you are only thinking in terms of meeting a particular savings milestone in the near future.


If, however, you want to create and maintain an optimal lifestyle, rather than just hitting particular targets, the sustainability of your financial habits and approaches, and your overall lifestyle, are absolutely at the core of your ability to achieve that.

Part of the equation here is being able to come up with ways of structuring your everyday life so that the financial habits you implement are things you can comfortably live with day-to-day.