• Finance, Advice

Accounting for What Matters

What if the things that really mattered…mattered on the balance sheet?

Last week in the New York Times blog, economist Nancy Folbre had a great meditation on our economic system’s flawed accounting systems. She wonders how our world would look if we included social costs and benefits in with all the rest of the assets/liabilities/stocks/piggy banks.

Thinking about this system raises a lot of questions (How would we practically quantify social goods? How would we account for future value? How much does an oil spill really cost?). This kind of analysis also has the potential to completely overturn our understanding of “rich.”

Freelancers are a great example of this kind of value struggle, frequently navigating a different path between quality of life and dollar signs. Many independents choose the freedom of their flexible schedules, creative work, and time outside an office over a steady or large paycheck. Many independents also take the idea of social good into account when choosing work – seasoned freelancers can be discerning about the kind of projects they take on. Turns out creating a rich life is more valuable than earning income, especially when you, your family, and community are all connected.

What does your spending and earnings ledger look like when you account for social goods?

Image via flickr.