Budgeting for the eight forms of capital

Has anyone ever come up with some way of writing a budget that accounts for more than just financial and material capital?

Clearly many kinds of capital don't quantify well on a spreadsheet, but is there some kind of budgeting paradigm/process that somehow takes into account all eight forms of capital? (And if not... can somebody please develop one? The world needs it.)

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Back-story/TLDR:

For the past few years I have been focusing my efforts into work that, while not formalized, basically looks like a non-profit company that is losing money. I pay rent, run programs, and provide services, but make very little income from these activities. This is deliberate.

Why? Because these activities are making me and my community much richer, in non-financial ways. I and my community are growing in social, spiritual, cultural, and living capital. My impression is that despite the money I am spending, I am operating in the black. (While I would guess most corporations are actually in the red because of their negative impact on these same forms of capital). But all my math on this is internal and fuzzy. It would be nice to lay it out on paper somehow.

Sort of…

Anything can be graded as long as it is an order and tracked. To do this in my life I use the four square system in conjunction with a budget. I basically break my endeavors down to two things:

Money
Time

Since I value my time more than money, I break it down if whether my time is well spent. I do not look at money as negatively as you do, I see it as a tool and so while I might not value it as much as time, it is something I can use to better myself and the people around me. So I do.

An example is writing. While it takes me on average 3-4 months to write a novel, from that I get a book that can transcend my time upon this earth. So for me writing has immense value because 90 to 120 days equals a lifetime of reward.

Fencing a field is the same way. It might take me three days to fence 10 acres, but that fence will be up for 30 years or more, so it’s time to build versus its life span is a good ratio. Now divide the cost by years in service and I can chart the true value of the fence. Quantify how much that fence will net me in lamb sales and predator loss prevention and I get a calculation on its real value.

Those are just two examples. Gaming and visiting non productive forums are examples of the opposite that I would never do. They suck up my time bc and net me no money. Why would I do that?

Maybe start with Nearings division of time and then with that three: Food labor, leisure and social/community. Dividing into those three and then subdividing into the spiral of 8.

Maybe finding someway to quantify the benefit you're providing to the community?

Amount of city/county tax dollars not needing to be spent because your efforts, # of trash bags diverted from landfill, # of people/month who had a better day thanks to your services, etc.

Depending on what services you provide, you might even be able to apply for 501c3, accept food stamps, or receive a grant, and become "in-the-black" money-wise, without taking away from the good work you already do!

Robert Ray wrote:Maybe start with Nearings division of time and then with that three: Food labor, leisure and social/community. Dividing into those three and then subdividing into the spiral of 8.

Nearings division? Is that a principle by Scott Nearing? I am having trouble finding anything about it... is there another term I could search?

Dustin Rhodes wrote:Maybe finding someway to quantify the benefit you're providing to the community?

Amount of city/county tax dollars not needing to be spent because your efforts, # of trash bags diverted from landfill, # of people/month who had a better day thanks to your services, etc.

I'm not sure if straight-up quantification is going to be useful.

I'm averse to reducing non-financial value to financial value (eg, by counting city tax dollars saved) because financial calculations already have built-in degradation of other forms of capital (e.g, it gives no value to living capital). So if I try to quantify everything in dollars, I think I am necessarily under-quantifying the other forms of capital.

I kinda like the idea of counting other things like bags of trash or people helped; but then how do I compare that to dollars spent? The two are quantified but not comparable. Would  I then make up a translation ratio? I.e., one person spending a month here instead of on the street equals X dollars? It seems like a cold and very arbitrary reduction. And how do I quantify something like a group of people learning more about how they use water and then maybe some of them changing their water-use habits a little? Or count a person who was lonely and is now held by a loving community?

I'm suspecting there's not going to be a great way to directly compare quantities of different forms of capital. I was hoping for something more like a qualitative comparison that possibly brings in some quantification? (Since the money is of course quantified.) I appreciate Steve's "Time vs Money" comparison above, but it seems harder when I'm comparing at least five forms of capital; one of which is cultural capital that is inherently group-owned.

On a broader note, isn't this what our economy desperately needs: a form of budgeting that takes into account at least living/natural capital if not all forms? It's the reduction-to-only-financial that leads our society to reward the biggest extractors the most.

Edward Pastore wrote:

Robert Ray wrote:Maybe start with Nearings division of time and then with that three: Food labor, leisure and social/community. Dividing into those three and then subdividing into the spiral of 8.

Nearings division? Is that a principle by Scott Nearing? I am having trouble finding anything about it... is there another term I could search?

Yes, they describe it in their book Living the Good Life. Which I just returned to the library. They divided their day into 4 hours of work, 4 hours of leisure and four hours of social time. They were vegan farmers, so they didn't have to take care of farm animals. They also kept lists of tasks on index cards. They had their goals, such as building a root cellar or a shop. They broke those goals into tasks, and specified whether it was a task for fine weather or stormy weather. Then, at breakfast, they would look at the weather,  their current needs, and list of tasks to decide what they would work on that morning.

I have never been driven by money either but the original poster is kind of being evasive here. You are trying to quantify something fiscally without recognizing the value of money?

It comes down to this simple truth: you can not pour anything from an empty cup.

It does not matter if it is time, money or good deeds we are talking about here, if a person is struggling themselves, then it’s not going to be long before they go poor or get burned out.

The goal then if that is a truth is to figure out how to keep the cup always full whether that be in energy levels, interest or money. Using the four square system s person can quantify that. For me, I use it to judge people in my life and if I want to spend time with them or not. At 48 years old I want to spend my time bc advancing others and myself and civic duties is how I qualify that.

Aligning myself with people who are likeminded has allowed me to really jump ahead these last years. I am with people pulling the train and not trying to drag it down now and that’s good for us all.

Sorry if I missed it but what are the 8 forms of capital?

The Eight Forms Of Capital

Natural
Financial
Material
Intellectual
Experiential
Social
Cultural
Spiritual

If someone is using the eight forms of capital as a guide monetizing some of the catagotries would be difficult for me. I see where they have value but not in a nickle and dime sense. Cultural and Spiritual cups are cup that would never empty. Intellectual and experiential are cups constantly being filled and they have a value when shared. Financial and material is a cup that I would fill with labor. The natural category is finite and one has to protect it It has  to be nutured to keep and provide value. Social is a cup that requires sharing, kindness, nuturing the commons it's sometimes hard to share kindness but it is a cup that you are responsible for filling and sharing.  vaer snill.... be kind.... How to monetize that?

That's a very elegant way of putting it, Robert. Thank you; that analogy helps me conceptualize it much more clearly. I'm going to have to think on that one for a while, but I think those thoughts will be fruitful.

But to be clear, I'm not trying to monetize the other kinds of wealth; just to have some sort of accounting. I want something that lets me assure myself that the dollars I am spending are well-spent... in a way that I can ask others to spend dollars on too. I'm going to play with the cups analogy and see what happens when I try counting the different forms of capital each in their native currency.

To me, it is best to keep budgeting as simple as possible.

Trying to include things that are not realistic to me is setting myself up for failure.

My budget goes something like this:  Housing, food, electricity, gasoline, insurance, entertainment, etc.

I found this thread interesting and you or others might too:

https://permies.com/t/178754/Knowing-Capital-Growing-Capital-Kinds

I learned how to budget my money from Dave Ramsey:

What Kind of Budget Does Dave Ramsey Recommend? A budget is a plan for how you're going to spend your money. It puts you in charge and in control of every dollar that you earn or spend. Dave recommends telling every dollar where it should go—before the month begins

https://www.ramseysolutions.com/budgeting/how-to-budget

Edward,
You clearly stated in your original post "other than financial" the spiral of 8 have categories of things that have value but are hard to monetize, but when someone says capital many think dollars. Spiritual soul capital is definitely a personal thing. But Cultural capital would depend on familial sharing of ancestral remembrance in some cases. I personally think "Cultural Misappropriation" is a sad thing, sharing something as a simple love of food or a clothing style isn't cultural theft it's a celebration of a culture. I see where the 8 identify things that have value, maybe some way to separate the immediate focus some get with the word capital for those important personal and community values that make for a vibrant accepting community and individual. Community Capital, Aural Capital, Well Being Capital, Neighborhood Capital, some way to scale the welcome to our table capital. Some of those categories of value obviously have and ultimately translate into dollars by people wanting to be in that community. Increasing  ones desire to be "here" because the draw of those ephemeral categories increases local economies., How much each category increases that desire that would increase  the local economy, still hard to quantify. A VAC scale, value added capital?

Edward, Paul's post on Spoon Theory might be helpful for thinking about the social and community forms of capital.

I am going to make up some numbers because I am a numbers person.

I'm going to pretend that the average person has 50 spoons a day. Maybe they get 20 spoons the moment they wake up after a good night's sleep. And they pick up 30 spoons throughought the day from either time passing or from positive things happening. Eating a lovely lunch - 3 spoons bonus! Eating huckleberry pie, five spoon bonus! Saying something supportive to a friend who then says "thanks I needed that!" - ten spoons!

And then, through the day, there are things that cost spoons. A mean person at work does a snotty thing: 20 spoons. Digestive distress, 7 spoons. Stub your toe, two spoons. Have a cold, 20 spoons per day.

And then there are big ones: somebody has a big problem and you step in to help, but the problem is just too big, and while you did help, you didn't help enough and that person and others seem to hate you for trying to help - they say you fucked everything up and they don't see how you DID help, just not as much as they want .... the whole thing turns into an ugly shit storm ... 210 spoons per episode.

You can save spoons and build up a large reserve.

When your reserve is gone and you spend more spoons than you have, you get sick. You will need future spoons to get healthy again.  

Hello, i invite you to have a look here : www.designpermacomptable.com, they develop a meta-accountancy with 8 forms of capital.
It leads to new forms of models named Puissance 8.
Please have a look !

As I read this thread, I wonder, why we want to measure non-tangible capital of relationships (social), creative expression (culture), spirit...

Physical resources are often measured to see if we have enough to accomplish a building or doing something.
We may need Natural resources, Materials, Finances, Intellectual & Experiential (know how), labor.  And we need to know if we
have enough or need to get more capital to do what we want to accomplish.

Or if you are asking others to support something with their time, energy, resources and money, you may want to quantify and qualify the good that you do, to persuade them.

Or if you just feel you need to motivate yourself and the people who share the task, you may want to see you've reached some goals or set some goals that include measuring the less tangible.

It may be important to know why you feel a need to measure less-tangibles.

Personally, I think we need a monetary system that pays us for improving community relationships, spiritual connection, creative expression, for caring, for bringing our true selves to the table ....  
For using materials that grow again, and energy that is ubiquitous, and nutrients that cycle - never running out ...

On the other hand, it seems to me finances / money can be exchanged for most tangible capital: material, know-how, labor, land... If you have finances, you can get the capital you actually need.  But giving the less tangible (i say less, because you can 'feel' spirit and beauty)  financial value, it's like we are making it a commodity.  I would rather move toward a world where the less tangible remains free and the tangible become more and more free.  

So, Why?  Umm???

This is an interesting idea and I like it because it decenters monitary wealth, making it not the be-all-and-end-all that people often see it as.  Where as tangible resources, time, etc. are also important and should be valued, also the teaching of skills, etc.  That's one thing I like about intentional communities, they see time as a commodity and in some you can use time in place of money if necessary.  And you can do more bartering, trade singing a concert for something else, etc.

I'm glad more people are looking at other resources than money as being valuable.  In particular I reckon time is the most important thing we have, because its finite.