Saturday, April 25, 2009

Invest in Energy Efficiency

You can get pretty awesome, tax free returns from investing in energy efficiency. The way you make these returns is by saving money on your utility bill. Basically, the money you save is like a dividend payment on your initial investment. One really cool difference between these dividends and those that are paid by the bank: you don't pay taxes on these dividends. You aren't actually "making" money, you're just saving it so you can spend it on other stuff. There's also the added bonus of better services from appliances. For instance, if you put in a new refrigerator, it's likely to have spill proof (resistant) shelves where your old fridge had the wire racks...or it makes ice faster...or there's a light in the freezer, etc. My gas stove saves me time by heating up faster.

You can often get tax credits or grants or some other credit for making energy efficiency improvements to your house. Another advantage is the stability of your investment. It's not volatile like the stock market. Also, it's countercyclical. In times when energy prices rise, you'll be getting a higher return on your investment. Right now, many people are scared to invest in stocks and real estate, so this provides a good alternative to holding your money under the mattress. There's never been a better time to invest in energy efficiency.
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