Personal Finance - Part 3, Investments

This is the final installment in a three-part series about personal finance for the conscious green Edmontonian. It covers:

  1. day to day finances
  2. retirement
  3. investments


The above picture is the world oil consumption curve. It is often displayed as just data, allowing what will happen on the down slope to our imaginations.

Peak oil is just one of many ways in which we are reaching the limits of our growth as a species. I find it highly absurd, then, that adults (you know, the ones who are all grow’ds up)  cannot rationally discuss the end of growth in polite company. And it’s virtually never discussed by anyone with any power. The fact of the matter is, infinite growth is impossible in a finite world. Let me repeat that:

Infinite growth is impossible in a finite world

Yes, it sucks. Yes, it’s inconvenient. But it’s true.

Maybe it’s a facet of denial, but it is easy to “understand” on one level about growth ending, and then turn around and invest our money in mutual funds and stock markets.

In my humble opinion, investing your money in stocks/mutual funds means one of two things:

  1. image The Unicorn Option - You believe that infinite growth is possible in our finite ecosystem. If this describes you, stop reading – the unicorns will deliver your fortune when the time is right.


  2. image The Playa Option - You recognize that growth will end, but you think that you’re smart and ruthless enough to get out of the stock market before all the suckers do (you know, your children and all those those other weaklings).

Option one speaks for itself, and I personally wouldn’t be counting on option two if my retirement was more than a couple of years away.

In a shrinking economy, money has few places to hide. Stocks? It’s tough enough to make money in a growing economy. GICs? I can’t see the value of money going anywhere but down in a shrinking economy. In other words, inflation will give “safe” interest-bearing investments negative returns. Gold? Maybe. I haven’t really looked into it.

What is the conscious Edmontonian to do?

My family has turned to energy efficiency and renewables as vehicles in which to invest our extra money. These investments eventually evolved into us building our Net Zero Energy Home.

Energy Efficiency

Many energy efficiency investments make sense in a growing economy, and they all make sense in a shrinking economy. Here are some example:

  • Light bulbs – Compact Fluorescents are cliché now, but their non-adoption is proof of their inability to get respect as investments. Investment in a CFL, depending on how much it is used, can pay a 400% return after taxes.
  • Appliances – Replacing a working top loader with a front loader pays back about 8%, and replacing a 1993 fridge pays back about 12%.
  • Showerheads – Replacing even the lowest flow shower head that you can buy at Home Depot with a $100 Bricor showerhead pays upwards of 50%.


The list of energy efficiency investments goes on and on. Renewables stop making so much sense in today’s growing economy though.

Our solar panels will pay back about 2% per year, for example. Not so great compared to a GIC (not so bad either…), but fabulous if the economy is shrinking 3% per year.The same goes for our solar hot water system – there is a payback (I haven’t calculated it yet), but it is not as eye-popping as that of a CFL or an efficient freezer.

But if you know the “secret” that growth will eventually reverse or (at best) stop, a PV module that will be producing electricity (and therefore a return on your investment) 50 years from now looks like a great investment.

Net Zero Energy Home

The ultimate end point of an efficiency+renewables investment strategy is a net zero energy home. It maxes out one’s personal efficiency and renewables investments and takes advantage of the natural synergy that they share (my thoughts on affording one are here).

In a shrinking economy, such a home retains huge value relative to other assets. It provides services no matter how poorly the stock markets are doing. In our case, the Mill Creek NetZero Home will provide us with heat, electricity, shelter, food, and (possibly) rental income regardless of the state of economy.


The small amount of money for daily life, once our net zero home is paid off, will be attainable through a modest amount of work. For us, then, our saving days will be over once our mortgage is paid off.

By then, we will have enough wealth. And that’s really the upshot. Do you have a definition of what is enough? Without enough, you will be a slave for a long long time.


So we reduced our personal spending, reconsidered the meaning of retirement, and chose a safe investment vehicle. That’s how my family has decided to handle our personal finances. I think it’s an ethical, green, and secure way to go.

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Hi Conrad
I hope you don't mind that I have included a link to the blog above in the Q&A section over at the Green Building Adviser website
Maybe you would like to get involved in the discussion??

The problem with your prescription is that you don't follow your logic far enough (just as you accuse others of).

If the financial economy is collapsing (and it is), then any investment based on a dollar return is a failed investment.

And any investment that requires debt financing enslaves you to the money economy which is strangling the middle class for the enrichment of the wealthy.

The safest and greenest investments will be in subsistence tools for a lifestyle disconnected from a collapsing infrastructure (money, energy, food, transportation, goods). Not a "zero energy house" but a house that requires no inputs or maintenance beyond what's locally available, growable, makeable or tradeable, and one that can be built by one's own or tradeable labor from local native materials.

The crash is coming sooner than you might think.

Thanks for the comment Riversong.

I don't think that anyone can predict with certainty that the next step is a subsistence economy.

We did build the home to be resilient to shocks by installing a wood burner (discussed here), landscaping a permaculture yard, capturing rain water onsite, and building a cold room.

I think that a Net Zero home, built with resiliency in mind, could be an extremely valuable asset to a family even if a subsistence economy is here sooner rather than later. After all, staying warm and dry is vital to subsisting :) Especially in northern Alberta. And our solar panels could be converted to charge batteries instead of depending on the grid.

Since we live in a functioning industrialized economy right now, we plan to keeping working "within the system" until we've built an asset that retains value in all situations. Except lawlessness of course, which is entirely possible.

I'm curious as to what you advocate doing with one's time/money until the crash arrives (which will not necessarily happen - we could be facing a long, slow decent rather than a violent crash).

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