Bill shock, especially here in Australia is a very real thing. Over the last decade the cost of electricity has gone up more than 250%, it’s insane!
Low income households are being forced to freeze during winter or pay massive power bills they can’t afford. It’s not just in the land down under either, people all over the world are struggling to pay what is one of the most critical bills.
“Nearly a third of households in the United States have struggled to pay their energy bills, the Energy Information Administration said in a report released Wednesday.”NPR
Struggling to pay your power bill or being shocked to see it costing huge amounts of money each quarter isn’t something you have to put up with though. For years now solar has been taking big, expensive energy bills and crushing them. Many even have the power companies paying them money instead!
This is a picture of one of our power bills from back in 2012. Since having our (now comparatively small) 1.5 kW system installed it’s meant tiny power bills in the winter and valuable extra income in the summer. Opening our “bill” is now like opening a pay check!
It’s not a scam, it’s not BS, it’s just a fantastic technology that you can use to generate passive income and get rid of those ridiculous power bills forever.
How Much Does It Cost?
It’s usually the first question people have when they hear about Solar. How much will it cost me? As usual, the answer is “it depends”. You can head over to Solar Quotes for those of you in Australia for the latest rough figures but as of March 2020, approximate prices for good quality solar panel systems in Australia (Tier 1 panels + quality string inverter), including full installation, are:
- 3kW: $3,500 – $5,000 AUD
- 5kW: $4,500 – $8,000 AUD
- 6kW: $5,000 – $9,000 AUD
- 10kW: $8,000 – $12,000 AUD
As they point out: the upper end prices are for top-end systems (e.g. LG/Sunpower panels with full panel level optimisation), installed by a solar energy ‘craftsman‘. Note the above prices also include the discount from the solar ‘rebate’.
If you’re overseas and thus, obviously don’t get the solar rebate your prices will likely be higher. That being said solar is plunging in price literally every year so if you haven’t checked in on prices recently I’d recommend you do it once again.
How Much Will I Save?
Next up is the question of how much you’ll save or what the “payback period” will be. Obviously figures vary wildly with some stating an average household will be as much as $1,800 a year better off. Generally though a well designed system will be paid back in around 4-6 years. After that it’s all profit baby!
That’s a ROI of around 16-25% which is basically unheard of when it comes to things that are as sure of a bet as solar is. Normally if you’re investing $8,000 into something and expecting a 20% ROI it’d be quite risky!
With solar though your returns are basically guaranteed so long as you get a quality installation done with good components and a good installer/warranty.
Those caveats are very important and unfortunately rather tricky for most people to navigate as the current environment of “solar deals” isn’t the best. In fact, the biggest problem with getting solar is that buying it isn’t a very straight forward process, despite what solar installers might tell you…
Installing solar shouldn’t be difficult. You should be able to call up a solar installer and just get it done, but every year thousands get ripped off, have poor quality solar equipment installed or have things go wrong. Things that could have been avoided saving them multiple thousands of dollars if they’d only known what to look out for.
This is the current reality when buying solar: A ridiculous web of trying to figure out which solar installers are solid… and which are slime. This is precisely why we developed and built our course on How To Buy Solar And Start Generating Passive Income
It allows you to have less money going out and a new passive income stream coming in. You will know how to spot bad solar installers, cheap solar and avoid getting ripped off as well as get critical insights into solar installation contracts to side step costly mistakes. We also go through what solar is, how it works, what solar brands are good and which ones to avoid plus even have a section specifically on Home Battery Energy Storage.
If you’re in the market to buy solar it’s a fantastic course covering everything you’ll need and more. While it uses many examples from the Australian market it’s also applicable to others overseas as well. We cover things like Feed in Tariffs in other countries as well as a step-by-step explanation of how your solar installation should go on the day… and an extra bit most don’t know about too!
Using Your Mortgage To Buy Solar Can Be Great
If you don’t have solar and know you’re missing out, but just can’t afford the upfront costs, there’s also a number of options you can make use of.
One of the best paths can be to use your mortgage to finance the purchase. While adding more onto your mortgage isn’t something I suggest lightly here at MTM it doesn’t take a math genius to realise that a 2-3% finance interest rate is fine when you’re making a 16-25% return on that money!
That being said do make sure you consult with your bank or financial adviser first before doing this as your situation will be unique and you may need to take special things into consideration I haven’t covered here. Please don’t take this as direct financial advice, I am simply making you aware that it is possible. So be smart and make sure it suits your personal situation first.
Other options that are available are things like financing with the solar installers themselves or even going on certain plans with your energy provider. These obviously decrease you ROI but you normally still end up coming out in front. The solar system will also increase the vale of your home too as it’s been proven by surveys that buyers want solar and will indeed pay more for it.
So at the end of the day, even if you don’t have the initial money to buy a system outright Solar makes great financial sense for most households. Unfortunately millions are still missing out on this great income booster and expense crusher. So if you do own your own roof and it’s currently not sporting a solar system get your ass in gear and book in a quote now! It’ll likely be one of the best investments you’ll ever make, provided you know all the tricks to look out for!
The benefits include: 1) How to pay off your mortgage faster than 99% of people with one hour a month of work 2) How to get rid of your debt and have the freedom to spend money on the things you love, guilt free 3) Clear outline of how to setup your expenses, mortgage and general finance 4) How offset accounts work and how to get the same result without being gouged by the big banks 5) How to cut through the crap and focus on the things that truly matter when taking down a mortgage 6) How to adjust the strategy so it works for you, even if you have kids, even if you only have one income 7) How to do all of these things and maintain a normal social life (and never be cheap).