The reasons to go solar are plenty. For one, the environment. Another reason would be to power your EV vehicle. Maybe you want to be self-sufficient and live off the grid? Or, perhaps you simply want to avoid the electric company’s price hikes. Remember January 2023? Oof! Those are all great reasons. But my favorite reason is that solar saves money. The savings can be immense, especially over time. Yes, installing them is an initial investment, but solar panels are what a call a money-saving investment.
Solar Is Affordable
Before I go into how much money installing solar panels saves, let’s talk about the initial investment. I want to debunk the myth that solar is too expensive. In fact, solar panels are very affordable. We shopped around for the cheapest option and chose a solar panel company, Sunlux, who installed our panels for less than $20k. $20k is AFFORDABLE. $20k is less than a brand new car. Heck, it’s less than many used cars, too.
If you don’t have $20K to pay off the solar upfront, you can finance it. A 10-year loan with Sunlux runs about $115 per month. That payment is covered by the savings from not paying the electric company! Below, I share with you our electricity bills after solar was installed mid-March. You can see that our savings run anywhere from $94-$150!
- How to Lower Electricity Bill
- How to Lower Gas Bill
- How Californians Can Make Money with Ohm Connect
Federal Tax Rebate Reimburses 30% of Total Cost of Solar
We were ecstatic to learn that they extended the federal tax rebate in 2023. This reimburses 30% of the total cost of solar panel installation. Since our solar cost $20k to install, we would get $6k back on our return next year. This makes the true cost of installing the solar panel $14k.
Solar Can Reduce Taxes on Your Real Estate’s Capital Gains
When you sell a property, you are taxed on long-term capital gains. However, you can subtract improvements you made to the home while living there. Solar panels count! Subtracting $20k from a properties capital gains saves someone $4k in taxes assuming they are in the 20% tax bracket!
It Takes 7.2 Years of Solar To Come Out Ahead
So assuming you save $6 k from the tax rebate and $4 K from the capital gains tax, the solar really only costs $10K. Financed at $115 / month (which is what you would pay anyway to the electric company if you didn’t have solar), you come out even at 7.2 years. However, the solar you just installed should continue to give returns after 7.2 years. This means every year after that, you are saving $115 / month. Meanwhile, the electric companies likely hiked the price of electricity due to rising demand coming from an increase in popularity of electric vehicles, electric stoves, and electric dryers. Factor in inflation, and you can quickly see why solar panels are a money-saving investment!
In conclusion, installing solar isn’t any different from paying the electric company when financed. Your monthly bills isn’t going to change much. For many, it would save you money actually. In the end, it would lead to savings in the future! Install it today, and your future self will thank you.
*If you are local to Orange County and wish to use Sunlux, would you do me a favor and mention my name as Sunlux offers a referral reward for previous clients. Thank you!