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The Value of Debt & Home Solar

Publish Date: August 13th, 2020

First time home buyers are looking for a place to call home, a place to raise a family, or maybe to gain a little more space compared to the apartment they have been living in. In addition to these drivers for buying a home, people understand that a home represents an investment that can help build their wealth over time. People see a home mortgage as good debt.

It’s not as common to view solar in the same light, but the comparison can help us understand the investing potential of solar. Installing home solar removes your monthly utility bill (over time if you finance, right away if you purchase your system outright) and provides a significant return on your investment over time.

Renting Vs Owning

As a renter, your money is going out the door to your landlord, and you never see a return on those payments. When you buy a home, your monthly mortgage payments are now going toward building equity in your home. Over time, your home equity can build your wealth as well as be leveraged for loans or lines of credit.

With your electricity bill, your monthly payments are going out to your utility provider, but you don’t get any return on that money. Each payment is a sunk cost with no equity to be had. Enter solar.

Think of solar as owning your electricity production, just like buying a home gives you ownership of your property. Instead of paying the utility, you are now generating your own electricity with a solar panel array on your home. (Learn more about how solar offsets your energy bill with net metering.)

Good Debt

Debt is sometimes considered a four-letter word, but not all debt is bad all the time. If taking on debt can help you build wealth or improve your financial future, that debt is often considered good debt. Of course determining whether debt is good or bad depends on many personal factors, so we can’t make a blanket statement about any specific kind of debt.* But if your roof is a good fit for solar, then solar might represent good debt for you.

Of course, this assumes that you are financing your solar panel system. When financing a solar panel system for your home, you are investing in a reduced or 100% offset electricity bill while also increasing the value of your home. But if you purchase your system outright, then you are reducing or removing your electrical expenses on day one and will see the most return on your solar investment.

The Value of Solar

Our utility bills are such a normal part of life that we often don’t consider the full financial opportunity provided by solar energy. It’s normal to think about buying a home as a way to own property and build wealth, but what about owning your energy production as a means of building wealth? It’s the same concept, just with modern technology.

If you’re interested in learning more about solar for your home, reach out to our team of home solar advisors. We don’t work on commission, and our focus is always giving you the information you need to make the best decision for your home. No pressure, no sales pitch.


*We’re not encouraging debt, and we’re not financial advisors. Get professional advice if you have questions about managing money and debt.