Solar Panels – 3rd Passive Income

23 Responses

  1. John R says:

    solar panel idea: On the basis the total installed cost is $30k + $18k roof + any maintenance costs = $48k+. x 2.59% interest on the borrowed money.

    The Payback of $3k/yr x 16 years straight line calculation before you are profitable, closer to 20 years when factoring in the interest on the loan carrying charges. Will you use the $3k/yr to pay down the loan or use it to invest in something else?

    Doesn’t seem like a good investment, maybe I missed something

    What about solarbonds?

    On the leveraged money from your mortgage/HELOC.

    On the $50k private investment paying 12%, is it guaranteed 100%, sounds too good to be true.

    Maxing your wifes TFSA. You do know that you cannot deduct the interest you pay when using the proceeds of that in the TFSA for investment,

    On the basis you are paying 2.59% on the $52k, you’d need to make sure the capital never goes down as well as the dividends are always more than what you are paying in interest

    • Hey John good points. As for the roof that’s worse case scenario. Best case our roof is good and solar panels go on for 28,000 after hst refund. If the roof needs to be done I can reshingle it or go metal roof. Costs would range but I’ve always wanted a metal roof anyways.

      The private investment is family company and they have been doing it for years with great results.I agree it almost sounds to good to be true but they have been very successful and we trust them. As for writing off the loan intrest I don’t really care. We did a quick calculator today and with the lower rate at 2.59 and extending the mortgage ammorization by 5 years. We could get $150,000 cash and our biweekly payments would only increase $100. Of course our mortgage gets extended another 5 years tho. But with those investments listed above we could earn 11,000 in passive income just off that.(3000 for solar panels, 6000 family investment and approx 2000 from dividends in tfsa (Like you mentioned if the tfsa keeps paying dividends) I averaged 4% return on that dividend.
      Seems fantastic and if it all works out we would smash our current financial goals!

      Also all income would be reinvested or used for extra principle mortgage payments.

  2. John R says:

    thanks for that PCI, looks like you have the investments as well as the risk & carrying charges all figured out.

    Good luck to you

    Just a thought on the remortgaging.

    Have you looked at or considered a combined mortgage with HELOC. Leave the remaining mortgage balance as is and take out a HELOC for however much they’ll give you?

    • Hey John no I haven’t actually something I should look into.I know it will be a higher rate I think like 3.5 and would that mean I need to make 2 different payments? You always give me something to think about. Thanks

  3. John R says:

    On the remortgage vs HELOC, TAKING $100K, you’ll be paying more per month in payments on the mortgage to what you’d be paying on the HELOC. Maybe also consider a margin account for non-registered investments. Interactive brokers (IB) charge 2% interest on margins

    Half way down the page in the link in $Cdn

    FWIW, heads up, the following tool may be of interest to you when looking at whats in your portfolio or considering a new stock buy

    at the top of the page in the url you can change the symbol to look at other stocks.

    • After looking at that bull page How good do you find it. I looked at a couple positions I own and they were buy and sell trades every week on like 7 cent moves…

      I’m a long term investor. I don’t know if they are almost day traders. A 7 cent difference from a buy position to a sell position in one week doesn’t really makes sense. A 7% one would.

  4. I’m interested in solar power as well, and think your thoughts and analysis is thorough above. Given that you think you might sell or move in the near future, I don’t really know if it’s worth the expense right now. That being said, another income stream + saving the environment is always a good thing 🙂
    Erik @ The Mastermind Within recently posted…Happy Money: The Science of Happier SpendingMy Profile

  5. I’m really interested to see what Tesla does with solar roof tiles. I am waiting for that to come out before I throw money on solar panels at this point. Even if it’s a couple of years I think solar roof tiles will be the future. Although I could be really wrong 🙂
    MUSTARD SEED MONEY recently posted…Small Acts of Kindness, Big Results: Pay It ForwardMy Profile

  6. Leo T. Ly says:

    Since love to use debt to accumulate wealth. I am going to say, go for it PCI. I also locked in my mortgage refinance at 2.59% last year. There are quite a few dividend stocks that you can buy to easily create a dividend portfolio to get a 4% yield on your money. This means you are pocketing about 1.5% a year or more if you factor in the tax benefits. It takes money to make money.
    Leo T. Ly recently posted…The Benefits Of Investing With A PartnerMy Profile

  7. PellriderScarborough says:

    I am all in for refinancing for solar panels. That is the one thing I cannot do because of living in a condo. Keep raking the money. I think, the housing prices will not get affected by the solar panels. They can see the value in that.

  8. Troy @ Market History says:

    You should wait a little for the new Tesla rooftiles! They look really good, and over the long run are cheaper than standard rooftiles.

  9. Dave says:

    Thanks for your article. I live in Ontario as well and am looking into the solar panel option myself. I am personally sitting on the fence about it and thought I’d share some other thoughts:
    – I’ve heard you can write off (tax deductible) the portion of your new roof that gets covered by the solar panel if the solar panel is completed within a short time period
    – you can write off some other small expenses, as the solar panel is a business (e.g. internet can be written off if you download a solar panel app)
    – not sure if you’ve checked into your home insurance, but might be worth it as I believe it goes up a little bit with solar panels on your roof
    – how did you shop around the solar panel installer/company and who did you end up picking?

    • Hey Dave thanks. I had no clue I could write off a portion of the roof repair if need be. Intresting about the business expenses I got to look more into that. As for the insurance I knew that there will be a minimal increase. When shopping we applied and emailed about 4 sites. 3 companies replied. One was 5k cheaper then the other 2 and the design wouldn’t actually work on the house. 1 guy actually came to the house and told us all about it and was the middle price and had micro inverters. Another company was higher and was string inverters (which I really don’t want) generally string inverters cost 3-4 less from what I have heard. I liked Gala Energy the most so will be signing with them. Will keep updating the progress. It’s mostly paperwork and only 1 or 2 days for the install.

  10. I love the idea of solar panels and green energy. It still feels really early in the game for most of it so it costs a lot more until they can improve the technology. I do think that we are moving toward being green so it will be huge in the future. May pay off to get in early. Just have to do a cost/ earnings analysis and you have to stay in that house for a while to make it worthwhile.
    Dividend Daze recently posted…How to Decide Between Paying Off Student Loans Early Or Investing (Or Both)My Profile

  11. Love the idea of solar panels as a passive investment. We looked into it for our home but our south facing roof is too small. Panels would have to be placed on the East facing roof which also faces the street. Aesthetically its not a big deal for me but my wife doesn’t like the look.

    If you’re going to stay in your home for a while then it seems like a good opportunity.

    I’m assuming you’ll add this to your passive income report? Will you also add the loan to the report for the net impact?
    Owen @ PlanEasy recently posted…First-Time Home Buyer? Boost Your Down Payment!My Profile

    • Hey owen thanks yea I’m looking forward but right now it’s in hydros hands if we get approved. Honestly it would be in my passive income report but not the loan. We are in the process of refinancing house and by extending oue mortgage 5 yrs the payments only increase 100$ bi weekly. For well in excess of this cost. Maybe i will try to calculate that.

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