The dream to be free of societal bonds and live a self-sufficient lifestyle is an idea that is quickly taking over the nation. People are switching to alternative energy sources such as Tesla solar panels while trying to survive off of their land and their entrepreneurial talents. It makes sense that you may be considering the same thing as well. You may be wondering how people can afford Tesla solar panels and whether they offer any options for financing them?
Fortunately, your dreams of switching to solar power are not as far away as you may think. Tesla offers multiple options for those who wish to acquire their solar panels and begin their journey to a self-sufficient lifestyle.
Multiple factors will determine which financing option you choose. Continue reading to learn more about how you can turn your wish of owning a Tesla solar energy system from a dream into your reality.
Reasons for Going with Solar Energy
Before you begin your journey of choosing and financing a solar energy system, you should consider why you are interested in going solar. Everyone has different reasons for making the switch. Deciding what drives your decision is essential to getting the right system for you and your situation.
- Are you trying to be self-sufficient and go off of the grid?
- Are you trying to save more money?
- Do you want solar energy as a backup source of power in case the grid fails?
- Do you want solar energy as a long term option, or is it a temporary need for your situation?
- Do you want to reduce the carbon footprint you are leaving on the planet?
These are all important questions to ask yourself before purchasing a solar energy system because your answer can greatly affect how you purchase your system and how you use it. Your answer to these questions will also help you determine if you need to spend the additional cost of a battery powerwall.
Options for Financing a Tesla Solar Energy System
This is just a fancy way of saying that you are renting the equipment from Tesla, but you will never actually own it. There are pros and cons to this option, which are detailed below.
|The pros to this financing option are that you do not have to worry about maintaining the system, and if you move, you don’t have to worry about the fact that you spent a boatload of money on a solar energy system that you most likely are not going to take with you.||A con to using this option is that you will never actually own the equipment; if you do plan on staying in your home long-term, you will always have that subscription fee to pay; it is nice to eventually own everything on your property without being tied to debt, especially when you are trying to maintain a self-sufficient way of life|
|With this option, you may cancel and return the system at any time without any penalty fees. So, if you decide that solar is not for you, there is no money lost. This may also be a good way for someone who wants to test out solar energy before actually taking the plunge and purchasing their own system.||Another con to this option is that if you wish to have a powerwall for a backup energy supply, you have to pay for it out of your pocket or get a loan. Powerwalls are not inexpensive, and they are not included in the cost of the subscription.|
Going with solar energy is all about saving money and resources so, you are probably wondering how you can save money if you are paying a subscription fee every month?
The answer is simply that a subscription is really best for short term situations.
If you plan to use solar energy for the long-term, it makes more sense to get a loan and pay for your own system.
Loan Purchase Option
The second and most common option that people choose for obtaining a solar energy system is to get a loan and pay monthly payments until it is paid in full. The great thing about this option is that you are not required to put any money down, and you get your system installed as soon as your loan is approved.
The system comes with a 10-year comprehensive and 25-year panel performance warranty. Another benefit of financing your system is that you can apply the investment tax credit to your monthly payment for extra savings.
One more benefit of getting a loan for your solar energy system is that you can add the cost of a battery powerwall to the loan and have it installed at the same time as the main system. The only real con to the loan purchase option is that you have a monthly payment with interest, but the end result is that you own the equipment and are self-sufficient.
Cash Purchase Option
The final and definitely the most cost-effective option is to buy the system outright. Ideally, everyone would like to have the ability to make a large purchase like this and not worry about where they will be able to come up with such a large sum of money. Unfortunately, for many hardworking Americans, a cash purchase of this size is really not an option.
If you are among the fortunate who can pay for their Tesla solar energy system in-full, you will enjoy the same benefits as the loan purchase option with the exception of the monthly installments. Once your equipment is installed, it is yours. You don’t have to worry about making a payment and can focus on becoming more self-sufficient.
Federal Tax Credit & Local Incentives
The investment tax credit offers a discount of 26% of the cost of installing your solar energy system from your federal taxes. This discount applies to business or residential usage, and there is no ceiling on the discount, meaning that whether you pay $20K or $40K for your solar energy system, they will still give you the same 26% discount.
Acquiring Financing on Tesla’s Solar Energy System
Do you have to finance your solar energy system through Tesla? No, but if you do, they have an online portal that allows you to log into your account and conduct your business with them through a private system.
With Tesla’s online portal to your account, there is the option to go with paperless billing statements or have an automatic payment taken out of your bank account each month, so you don’t have to remember to pay your bill.
One con to financing directly with Tesla is that if you decide that you want to pay for your system in full, you have to wait a minimum of five years to do so. Keep this in mind when making your financing decisions.
The Option of Choosing Your Own Finance Company
The benefit of this is that you can shop around and look for the best available rates, and you are not locked in with Tesla directly.
What should you look for in a finance company?
When looking for a finance company, the main thing is to find the best interest rate possible. Also, find one that allows you to pay your loan off early without any penalty fees. If you find yourself in a position that you can pay your loan balance in full, you will have the freedom to do so.
Shop locally when you are looking for a personal finance company. When you shop where you live, you are a person with a life that matters, not just another number in a cold and seemingly uncaring corporate system.
How Long it Takes to Break Even on Your System?
The average amount of time it takes for you to break even on your investment is around eight years, depending on the amount of the loan. This particular example is based on a loan amount of $20,000.00.
Insure Your Solar Investment with Insurance
Something to calculate into the cost of a solar energy system is that you should have insurance that covers any damages or malfunctions to your system or home due to the system.
In most cases, your homeowner’s insurance will cover your solar energy system. However, you will most likely need to increase the coverage amount, which will probably increase your premium. A slight increase to your home owner’s insurance premium is worth the peace of mind, knowing that your investment is protected if something happens.
If your homeowner’s insurance policy does not cover the solar energy system, you will need to seek alternate insurance sources. In some cases, you may be able to include the cost of insurance with your monthly loan payment.
Best Financing Achieved With Practical Planning
Planning carefully and choosing the right financing option is essential when choosing to switch to solar energy. Your ultimate goal is to save money, become self-sufficient and reduce your carbon footprint on the earth.
Research all of your options before rushing into a financial commitment that you find difficult to change.