As the world undergoes economic upheavals and conventional notions of financial jurisprudence get debated, many people are endorsing what is being called collaborative consumption.
For centuries now, we have approached life with personal pursuits in mind. The objective has been to survive, live without indulging in risks and securing as much resources as one can, but for oneself and the immediate family. In the process, people buy homes, make investments, own cars and build up an infrastructure of their own that contains a few utilitarian and many nonessential items.
Many expenses that are still considered imperative are being questioned and their rationale is being bombarded with some enlightening facts. The math shows that renting is more economic than owning a home. Yet, everyone dreams of owning a home. Not owning a car can make someone richer by a small fortune over the years but no one thinks of a life without a car.
That is where collaborative consumption is making heads turn.
Let us explore what collaborative consumption truly is.
- Today, many families are wondering if investing in a standalone house is really a good idea. Many people opt for strata titling and cooperative ownership. Many people are opting for mixed use developments or residential buildings where the total cost of upkeep or maintenance and service requirements is being shared. Even if you want to travel, you could use collaborative consumption by putting up your home for tourists to stay at and you can earn your right to use the same service when you travel to some city or town. There are websites dedicated to house swapping or renting a space of the property while on holiday, Airbnb,com is one example.
- People living in big cities often shun the car because they have adequate public transportation. For those living outside big cities or in remote towns, that is not an option. But people are exploring car pooling, sharing and renting cars when they need instead of owning a car. A car is a depreciating asset which will never really allow you to recoup all your investment or even a substantive fraction of the expenses.
- People are sharing tools at their homes, pets and crucial resources that modern lifestyles cannot do without. Concepts like crowd funding and sharing software solutions have already become popular. Why spend a lot of money to have exclusive access to something that can easily be shared and used by many people, thus reducing the cost to a fraction?
Collaborative consumption may eventually change the way we perceive and approach financial planning.
