Solar has a number of great benefits for many people, and that means nearly everyone has a good reason to make the switch. This includes older Americans, one of the fastest-growing demographics in the country. The Baby Boomer generation is reaching retirement age, and with the advances in healthcare and medical technology, they’re expected to live longer and better lives in their golden years than any prior generation.
However, as anyone can tell you, planning for retirement means planning for rising costs of living and increasing expenses over time. One of the most difficult things to plan for is the rising costs of energy, however solar can help with that by stabilizing your costs and helping you save money. On this blog, we’ll talk about just a few of the reasons why switching to solar energy now could be the solution for the future of grandma’s house.
The Rising Costs of Energy
For the purposes of this blog, let’s assume you are an older American who is looking to retire within the next few years. People aged 55 and older make up an estimated 28 percent of the population—a larger percentage than at any other point in our nation’s history. Of these older Americans, four out of every five own their home, and nearly nine out of every ten want to stay in that house for as long as possible.
That means retirement now requires even greater savings than before and a much more detailed, long-term plan. While you may not have a mortgage anymore thanks to hard work and prudent investment, home ownership is not without its monthly costs like water, energy, and others. Utility rates are frequently on the rise, and here in California we have the not-so-wonderful privilege of enjoying some of the most expensive energy rates in the nation. To make matters worse, these rates are rising rapidly and showing no signs of slowing down. That means over time, you could find what was once a fairly normal expense now suddenly puts a huge strain on your limited income and tighter budget.
Let’s look at some national data. Say you were to retire today at the age of 60. The average senior consumes around 9,850 kilowatt-hours (kWh) of energy each year, equating to an annual energy cost of around $1,500 at a cost of 13 cents per kWh. However, energy rates are not stagnant and it’s expected that these rates will rise by about 3.5 percent each year over the next 25 years. What that means is that by the time you reach the age of 85, your annual expenditure will have more than doubled, costing you around $3,500 per year. Or to put it in more practical terms, your energy bill will go from $125 per month to $292!
And these are national averages—we’ve already stated previously that California’s rates are well above the national average, so in reality costs will be even higher. When you’re on limited income, that’s a huge burden to have to bear in addition to your medical care and treatment costs, food, and other expenses that will only rise as well.
How Solar Can Help
Solar may be the solution to help solve this problem. In order to produce just under 10,000 kWh of energy per year, you need a seven kilowatt solar energy system, which currently runs around $25,000, give or take a few thousand. However, there are plenty of financial incentives to help soften this cost and reduce tax burdens, especially here in California where we’re blessed with an environment that’s big on renewable energy. And here’s the good news, even before those incentives, a seven kilowatt system can almost completely offset your energy usage costs for the next 25 to 30 years.
This is because you eliminate or reduce your dependence on local utilities to provide you with the majority of the power, instead producing it right on your own roof. This gives you a much greater degree of control over your energy expenses and keeps them as small as possible in the face of rising public utility costs. This gives you 30 years or more of minimal energy expenses, thus stretching your retirement savings even further.
When you apply the amount this saves you to the cost of your solar panel system, the savings themselves can often make this payment for you, and even pay off your system for you completely in just a few short years. In fact, thanks to California’s high energy rates, we enjoy some of the shortest payoff periods in the country.
If you’re interested in switching to solar to help you save money in retirement, talk to one of our Southern California solar experts today! Call SunPower by Sea Bright Solar at (909) 480-3783.