Speaker 1: Welcome to How to Money. I'm Joel and I am Matt.
Speaker 1: Today we're talking about using energy tax credits to your advantage. Yeah, buddy.
Speaker 1: So we don't categorize our episodes this way, but if
Speaker 1: we did, this would definitely fall into the camp of
Speaker 1: episodes that are going to help save you money. You know,
Speaker 1: I don't think many folks get too excited about spending
Speaker 1: money on their home when they don't get to see
Speaker 1: the results of that money that they spend, Right, Like,
Speaker 1: I don't think folks mind spending on paint, like having
Speaker 1: your house painted. My parents actually they're in the middle
Speaker 1: of getting quotes for painting the interior of their home.
Speaker 1: It's not cheap, which they haven't done in like thirty years.
Speaker 1: It's gonna make a big difference, it is. I was
Speaker 1: shocked at the some of the numbers that Dad was
Speaker 1: telling me. But even still, I think that's something that
Speaker 1: folks can get behind. Or even like buying furniture or
Speaker 1: something like that, right, but they kind of up or
Speaker 1: a new rug which really ties the room together. That's right.
Speaker 1: But what we are going to be discussing today are
Speaker 1: the things, the upgrades that you can make that are
Speaker 1: a little nerdier that that said that funny that are
Speaker 1: a little nerdier because they're going to save you money.
Speaker 1: That's what we're talking about today. Yeah, so we're talking
Speaker 1: about specifically things you can do to your house that
Speaker 1: most of them are unseen or and they're really all
Speaker 1: about kind of energy efficiency. And so there are new
Speaker 1: kind of rules in place, new some new incentive, new intended,
Speaker 1: new perks for you to quiet these moves. Nerdy there
Speaker 1: we go. Yeah, it's good that time. Well, we normally
Speaker 1: when you like, we put these things off because we
Speaker 1: know that they might save us money. But we're like,
Speaker 1: it's just not as fun as like a new kitchen
Speaker 1: faucet or something like that, or new countertops or whatever
Speaker 1: it is there you go or ship lap like joint
Speaker 1: against like kitchen fawcett. That's that's you're reaching out of
Speaker 1: your own experience there, because you can make something you've got.
Speaker 1: You've had that pass, I need to actually put it in.
Speaker 1: It looks very nice, I bought it. It'll look awesome
Speaker 1: having get installed it. So your plumbing situation is out
Speaker 1: of control. Though you're the same, it's hard to get too. Yeah, yeah,
Speaker 1: I mean we both got up under there, and you're like,
Speaker 1: what do you think. I was just like, dude, I
Speaker 1: have no idea how any human being would be able
Speaker 1: to You need like a house elf to get up
Speaker 1: in there to take care of that and see if
Speaker 1: Dobby's available, so do that for him. But yeah, so
Speaker 1: we're gonna talk to all about that today. But I
Speaker 1: want to quickly mentioned before you get to that, Matt,
Speaker 1: that just there was this like a really sad situation
Speaker 1: in one of my kiddo's classes where one of her
Speaker 1: classmates parents passed, I know exactly, and they had just
Speaker 1: had what you're talking about, baby daughter. It was like
Speaker 1: the saddest thing in the world to me. And so
Speaker 1: the class was taking donations and everybody was so generous
Speaker 1: and just giving money to this family and really like
Speaker 1: supporting them in a bunch of other ways too. It's
Speaker 1: nice to live in a community where people take care
Speaker 1: of each other, right, And I feel like we live
Speaker 1: in a place where that is true. And it just
Speaker 1: made me think too that one of the person of
Speaker 1: spending lesson you make of being diligent about savings is
Speaker 1: that you can be like hyper generous in situations. Absolutely
Speaker 1: man so, and I've seen that be the case. Our
Speaker 1: family has been able to do that, but a lot
Speaker 1: of families around us too. Yeah, so yeah, it just
Speaker 1: kind of wanted to put that out there. Make sure
Speaker 1: that you're using your means to, especially when it comes
Speaker 1: to supporting communities, not just like, hey, let me donate
Speaker 1: some money to the Red Cross, which is fine and dandy,
Speaker 1: and I have no problem with you, but make sure
Speaker 1: you set some aside too for just stuff like that,
Speaker 1: because it breaks my heart. Absolutely. Yeah. I mean we
Speaker 1: touched we actually touched on this a little bit last week.
Speaker 1: But that is a great reason to be good with
Speaker 1: your money, to prepare in advance for these different opportunities
Speaker 1: that come up. But that's cool, man. Yeah, I'm glad
Speaker 1: that y'all are able to give. We our kids go
Speaker 1: to different schools, but even still, I had heard about
Speaker 1: that that heartbreaking store. My heart definitely goes out to
Speaker 1: that family. Maybe we'll reach out as well for sure.
Speaker 1: Yeah so all right, Sorry started to start a downer,
Speaker 1: but yeah, let's good job, buddy. Let's move on. Let's
Speaker 1: get to the topic in hand. We're talking about using
Speaker 1: these new energy tax credits to here, and we still
Speaker 1: got to introduce the beer. Oh, we have a beer.
Speaker 1: That's right, So maybe I kind of forgot about it
Speaker 1: because it is a beer that we're having for the
Speaker 1: second time of the show, the first time we've ever
Speaker 1: repeated a beer. Yeah, we had nothing in the first
Speaker 1: Now you're drawing all the attention to it. I was like,
Speaker 1: do we kind of just skate by and just thought
Speaker 1: we forgot to stock the beer fridge. So we've been
Speaker 1: we've been kind of busy lately. Party found and uh
Speaker 1: yeah next week next episode that we have a beer
Speaker 1: oun So I guess next Monday we will most definitely
Speaker 1: have something pressure a new an updated beer. Well, this
Speaker 1: one is pilsner. It's called b Boats by Creature Comforts.
Speaker 1: We'll give our thoughts on it at the end of
Speaker 1: the episode. Yes, even though we've had it before. But yeah,
Speaker 1: let's get to the let's do that topic. And even
Speaker 1: though it is a Pilsner, it is a craft pilsoner.
Speaker 1: I don't want people thinking that we, you know, there's
Speaker 1: a good one that we're like grabbing just like a basic,
Speaker 1: mass produced macrologger pilsner off the show. If you taste
Speaker 1: test or something, if you take test this next to
Speaker 1: one of the macros. It's a very big difference. So good,
Speaker 1: very big gray beer. Yeah. So all right, but let's
Speaker 1: talk about tax credits and how to make sure you're
Speaker 1: getting the most bang for your buck, make sure you're
Speaker 1: you know what cysts, and then how to use them.
Speaker 1: And it made me think, Matt, there was this article
Speaker 1: in the Free Press about folks that make money by
Speaker 1: trying new medications to test their efficacy. And like, they're
Speaker 1: they're getting injections, they're taking pills, and in some of
Speaker 1: the studies they can't even leave the building, but they're
Speaker 1: subject to under house arrest. Basically, basically they're subject to
Speaker 1: large amounts of blood being drawn and this can happen
Speaker 1: for weeks on end. And like, the question is why
Speaker 1: would someone subject themselves to this? And the answer is
Speaker 1: to make money, right, And the most fundamental reality of
Speaker 1: economics is that incentives drive everything. Incentives matter. And I'm
Speaker 1: not planning on going back to let's say, like my
Speaker 1: pressure washing side hustle from twenty years ago, not a
Speaker 1: bad job, not my favorite job of all time. Though,
Speaker 1: unless let's say it were to become massively lucrative. Let's
Speaker 1: say they were like we're going to start paying pressure
Speaker 1: washers like four hundred K year, I'd be like, boom,
Speaker 1: I'm done with podcasting. I'm all in on pressure washers
Speaker 1: of the new influencer, right, And if it was like
Speaker 1: everybody loved the pressure washer was like the cool job
Speaker 1: in town, maybe I'll consider it. I guarantee there are
Speaker 1: TikTok accounts out there dedicated to pressure washing. I'm sure
Speaker 1: there are, and I'm sure they're like fun to watch
Speaker 1: because there's got to be that that was the best
Speaker 1: part about it. After So I say that knowing that
Speaker 1: there Instagram knows you follow these people, knowing him, Well,
Speaker 1: there's this one account in this guy he's got like
Speaker 1: a long care business, and he sets up his phone
Speaker 1: and does it time lapse and he goes and pro
Speaker 1: bono cuts yards that haven't been touched that that are
Speaker 1: kind of like abandoned or the houses are sitting there
Speaker 1: empty and it is so satisfying while he gets in
Speaker 1: there with the edger and cuts along the sidewalk, blows
Speaker 1: it into the yard, hits it with the mower. Oh man,
Speaker 1: I love that kind of stuff. I would be all
Speaker 1: about watching some pressure washing going neighborhoods. One long care time, right, Yeah,
Speaker 1: well yeah, so like not my favorite job, like I said,
Speaker 1: but it was. I will say it was satisfying to
Speaker 1: see the end result. But I'm just like, it's never
Speaker 1: gonna happen. I'm never going back to that because the
Speaker 1: incentive just isn't there sure, And I think like making
Speaker 1: sure that your home is more efficient has never been
Speaker 1: a bad idea, right, but now it's a better one
Speaker 1: thanks to increased federal tax rebates. I think just the
Speaker 1: incentive hasn't been there for a lot of people. Even
Speaker 1: though they know they're going to save a little bit
Speaker 1: of money when it comes to their energy bills, they're
Speaker 1: just like, I don't know, it's not so enticing that
Speaker 1: I'm going to make the leap and actually put insulation
Speaker 1: in my house or something like this, or start installing
Speaker 1: weather shripping. But if you're a homeowner, we would say
Speaker 1: it makes more sense to think a little bit more
Speaker 1: about which upgrades you make and when and how you
Speaker 1: decide to make them. The incentives have changed, and I
Speaker 1: think they're going to be pushing you in the direction
Speaker 1: of doing some of these kind of behind the scenes
Speaker 1: changes to your house to save yourself some money. That's right, Yeah,
Speaker 1: so we're here to do some of that legwork to
Speaker 1: let you know which ones make a little more sense,
Speaker 1: which ones maybe don't. And you know, thinking back to
Speaker 1: that article on human lab rats, a lot of it
Speaker 1: I think kind of depends on their personal situations, right, Like,
Speaker 1: so for some folks it might be just the best
Speaker 1: paying gig that they can find. But then that that article,
Speaker 1: they also have talked about how other folks who were
Speaker 1: involved in those studies, how they actually enjoyed the community
Speaker 1: that forms in some of these longer studies, and that
Speaker 1: the participants they're actually sad when it's over. It's a
Speaker 1: fascinating part of it. Yeah, Yeah. And so similarly, whether
Speaker 1: these energy tax credits make sense, it partly depends on
Speaker 1: you whether going green, whether conserving energy, if if that's
Speaker 1: a high enough priority for you, whether that that cream
Speaker 1: kind of rises to the top, if that makes sense
Speaker 1: for you. But then of course there's the financial side
Speaker 1: of it as well, because you may have heard about
Speaker 1: these energy tax credits. We've even talked about them here
Speaker 1: on the show, and we know that making our homes
Speaker 1: more energy efficient, that that it's going to save us
Speaker 1: money every single month, But how much money could we
Speaker 1: actually save and how much money will we be able
Speaker 1: to get in federal tax credits as well, and so
Speaker 1: crunching the numbers that's going to help us to see
Speaker 1: just how powerful or not perhaps that these incentives are. Yeah,
Speaker 1: by the way, listener Lauren is the one who yet, Yeah. Absolutely.
Speaker 1: She wrote us an email and was like, hey, guys,
Speaker 1: can you do a deep dive on this? And normally
Speaker 1: we would say, hey, toss us a listener question, but
Speaker 1: we're like, wait a second, now, that's going to be
Speaker 1: there's a lot of information, there's lots of cover that
Speaker 1: would take the whole epit, so let's make it into
Speaker 1: a whole episode. So thank you Lauren for absolutely email
Speaker 1: and getting us started down this rabbit hole. But these
Speaker 1: energy incentives, Matt. They were added to the Inflation Reduction Act,
Speaker 1: which passed at the end of last year, which was
Speaker 1: confusingly abbreviated to IRA right yes, which confuses anybody who
Speaker 1: likes to say I hated that there is that overlap,
Speaker 1: and I'm like, oh man, people are going to get confused.
Speaker 1: I know, I know, but well it was also awkwardly named,
Speaker 1: not just for that reason, but also because it wasn't
Speaker 1: really doing much to reduce inflation, right, but it did
Speaker 1: have a bunch of stuff in there on the home
Speaker 1: improvement fronts and a lot of tax incentives to entire
Speaker 1: some owners to start saving money on utilities by by
Speaker 1: doing some of these things that we're talking about today.
Speaker 1: And so basically some of the things that you can
Speaker 1: save money on are like new installation in your home,
Speaker 1: buying an electric vehicle new or used. Actually, interestingly enough,
Speaker 1: that was one of the biggest changes in this bill,
Speaker 1: Putting solar panels on your home, and more. And we'll
Speaker 1: go over a lot of the specific upgrades that you
Speaker 1: can make in this episode. You might be super interested
Speaker 1: in some completely uninterested in others. That's fine. We're going
Speaker 1: to do our best to outline the specifics and in
Speaker 1: the broader strategy actually for how to approach this potentially
Speaker 1: free money or yeah, incentivize money to do something that
Speaker 1: might also be in your best interest over time. And
Speaker 1: the way these rules work, by the way, there's some
Speaker 1: hoops you're going to need to jump through in order
Speaker 1: to get the most out of these new government incentives.
Speaker 1: So we're kind of discussed all like the specifics, Hey,
Speaker 1: here are the things that qualify, and then we'll kind
Speaker 1: of talk about just a general approach too for how
Speaker 1: you maximize your ability to get these tax incentives. That's right. Yeah,
Speaker 1: we're going to get into how to actually pull the
Speaker 1: trigger and make this happen, as well as just how
Speaker 1: to think about some of these upgrades as well. And
Speaker 1: you know, it's important to note that many of these
Speaker 1: different incentives that they've been around for years, but this bill,
Speaker 1: it just sort of sweetened the pot. And so last
Speaker 1: year most of them only had a ten percent credit,
Speaker 1: oftentimes with severely limited maximum amounts. But now it's a
Speaker 1: thirty percent tax credit pretty much across the board. There
Speaker 1: are still annual maximums, which we'll get into, but putting
Speaker 1: in new installation in twenty twenty three, that's going to
Speaker 1: come with all more perks than it did last year
Speaker 1: in twenty twenty two. And you know, this is just
Speaker 1: really another creative way to save money every single month.
Speaker 1: It's not necessarily going to be sexy, like we're talking
Speaker 1: about at the beginning of I feel like maybe the
Speaker 1: sexiest thing is maybe solar in particular, these home energy upgrades,
Speaker 1: especially when we get them at a solid discount like
Speaker 1: this thirty percent off, it can decrease our energy usage
Speaker 1: and therefore our energy bills, saving us money. That's going
Speaker 1: to allow us to reach some of the different financial
Speaker 1: goals that we've set for ourselves. Yeah, and it's just nice.
Speaker 1: I don't know, there's something really satisfying about knowing that
Speaker 1: when you're heating a room or cooling a house or
Speaker 1: something like that, like we're basically starting to do now
Speaker 1: in Atlanta, that those dollars aren't just dissipating through the ceiling,
Speaker 1: right and having something like more insulation, beefing your insulation up.
Speaker 1: Knowing that everything's just working more efficiently, that kind of
Speaker 1: feels good. And maybe that's just like the adult in
Speaker 1: me and my twenty something self would have been like whatever, idiot,
Speaker 1: I don't even go buy beer. But there is something
Speaker 1: really nice about knowing that your air conditioner is not
Speaker 1: working as hard, that everything's just kind of a little
Speaker 1: more optimized, and that that you're saving money actually every
Speaker 1: month on your utility bills. And we will talk more
Speaker 1: than just about insulation. Yeah, there's more. There's a lot
Speaker 1: more too. But and you just mentioned Matt getting these
Speaker 1: upgrades at a discount, so let's quickly touch on how
Speaker 1: these credits work. Tax credits and tax deductions. They might
Speaker 1: be on your brain right now because tax days next week,
Speaker 1: and if you forgot about that, well your friendly reminder
Speaker 1: to your taxes. But a tax deduction is basically a
Speaker 1: reduction deduction, reduction of how much of your income is
Speaker 1: subject to being taxed. And so let's say you have
Speaker 1: an income of seventy five thousand dollars. Well, a ten
Speaker 1: thousand dollars deduction means that you're only going to get
Speaker 1: taxed on sixty five thousand dollars. That's what a deduction is.
Speaker 1: But a tax credit is a dollar for dollar reduction
Speaker 1: of the taxes that you owe, which makes this even
Speaker 1: more lucrative, even more significant. So in this hypothetical example,
Speaker 1: we're talking about a nearly eight thousand dollars difference in
Speaker 1: your tax liability between a ten thousand dollars deduction versus
Speaker 1: a ten thousand dollar our tax credit. And today we're
Speaker 1: talking about tax credits, So don't get them confused. Know
Speaker 1: that these are even even better. And by the way,
Speaker 1: you don't have to itemize either in order to get
Speaker 1: these tax credits, as outlined in the IRA. So if
Speaker 1: you're like, but I don't itemize, I take the standard deduction,
Speaker 1: you can still use these credits to your advantage. Yes, right, Yeah,
Speaker 1: and don't forget that in addition to these federal tax
Speaker 1: breaks that there might also be some incentives from your
Speaker 1: state government and possibly from local utility companies as well
Speaker 1: that can lead to additional savings. There's there's rebates available
Speaker 1: depending on your state that reduces the cost of certain
Speaker 1: new appliances. You can come almost like double dip. Really,
Speaker 1: it's like a triple dip man. You've got you've got
Speaker 1: the federal level, you're getting a benefit of the state
Speaker 1: level from the with the rebates, but then you're saving
Speaker 1: every single month in perpetuity. Yeah. And by the way,
Speaker 1: we're gonna have a lot of links that we're gonna refuct. Oh,
Speaker 1: so there's gonna be a lot up in the show
Speaker 1: notes and how to money dot Com. But specifically when
Speaker 1: it comes to all these state rebates, we'll link. We've
Speaker 1: got a good resource in there that you can check
Speaker 1: and very quickly see. Okay, I live in Massachusetts, where
Speaker 1: I live in Maine, what what is my state offering
Speaker 1: and what are my local utility companies offerings. There's a
Speaker 1: lot that's being offered out there, and these insense they're
Speaker 1: being offered to businesses, even other government agencies as well.
Speaker 1: But of course we're here to address the impact that
Speaker 1: it can have on us as homeowners, as residential customers.
Speaker 1: And so we'll get to the best ways that you
Speaker 1: can use these different energy tax credits to your advantage
Speaker 1: right after this break. All right, Matt, let's keep rolling.
Speaker 1: Let's talk about the energy tax credits are available to
Speaker 1: all Americans, all American homeowners right nationwide, and they can
Speaker 1: make a big difference in how much taxuo come April
Speaker 1: of next year. But they can also make a big
Speaker 1: difference in how livable your home feels in kind of
Speaker 1: how big your utility bills are. And there's a bunch
Speaker 1: of things across the spectrum that we want to touch
Speaker 1: on today. We're gonna get to all a bunch of
Speaker 1: the specific items that you can be looking to replace
Speaker 1: in your home, and then we'll kind of give you,
Speaker 1: like we said, kind of a way of thinking about
Speaker 1: when and how you go about doing these repairs. And
Speaker 1: there's a great chart from Energy dot gov that will
Speaker 1: include in the show notes for this episode they can
Speaker 1: give you just like a quick breakdown. But I guess
Speaker 1: maybe it might make sense to talk about how much
Speaker 1: somebody would stand to save if they do some of
Speaker 1: these improvements. And this is going to vary widely by
Speaker 1: the size of your home, by the climate where you
Speaker 1: live in, and the number of holes in your walls, right,
Speaker 1: and just kind of by the which of these actually
Speaker 1: do you end up doing. Do you just replace your
Speaker 1: air conditioner or do you put on rooftop solars like
Speaker 1: those are all going to make a big difference. But
Speaker 1: some estimates have said that the average American could save
Speaker 1: like two hundred dollars a year on utility bills alone
Speaker 1: if they implement a couple of these things, which again
Speaker 1: that's a double win, right, because you're improving your home
Speaker 1: and at the same time you're saving money. But some
Speaker 1: of these are going to pay off more than others,
Speaker 1: and there's a way to approach really how and when
Speaker 1: you're making these improvements. But let's go ahead and Matt
Speaker 1: and dive into some of the different equipment upgrades that
Speaker 1: you can make in order to save money. Let's get
Speaker 1: to the details, right, Yeah, So we've already mentioned a
Speaker 1: couple times now. But let's just make sure we hammer
Speaker 1: the point home and folks know that we're all about
Speaker 1: insulating your home. It really is like the lowest hanging
Speaker 1: fruit when it comes to is, and it always has been,
Speaker 1: but now the incentives make it richer. And what's so
Speaker 1: great about it too is that it really can be
Speaker 1: like this diy job. Like I've done blow in insulation
Speaker 1: before in my house. Ideally you've got a couple of folks,
Speaker 1: you know, you got somebody else there to help you out.
Speaker 1: They loaded in at the bottom, someone to cellulos. If
Speaker 1: you're going for the blow in style, you can see
Speaker 1: a little bit easier to do the bats that you
Speaker 1: roll out. But there's a cap of twelve hundred dollars
Speaker 1: a year, and so we're really talking about hopefully not
Speaker 1: spending more than four thousand dollars in materials in a
Speaker 1: given year, which would be a significant amount of material
Speaker 1: But were you to hit that dollar amount, that will
Speaker 1: help you to minimize your out of pocket and then
Speaker 1: you would actually be fully maximizing the credit that's being
Speaker 1: offered in this case. But how much we're putting in
Speaker 1: additional insulation save you well, like you said, Jill, every
Speaker 1: home is going to be different. But the Department of
Speaker 1: Energy they say that insulating your home home well that
Speaker 1: I can stay close to ten percent of the overall
Speaker 1: energy costs of a home or fifteen percent of the
Speaker 1: heating and cooling costs associated with keeping your home comfortable.
Speaker 1: So a lot of this depends on your current installation situation.
Speaker 1: But this, on one hand, you might be thinking, dude,
Speaker 1: that's chump change, But just think about the compounding impact
Speaker 1: that that has over the years, as that is something
Speaker 1: that you're able to realize. That's the savings you're able
Speaker 1: to personally realize for years to come. Yeah, so if
Speaker 1: you're talking about saving twenty bucks a month, because you
Speaker 1: toss that in, that could be you know, almost two
Speaker 1: hundred fifty bucks a year. In addition to the fact that,
Speaker 1: let's say, because of the federal tax rebait, really putting
Speaker 1: that insulation in might only cost you like fifteen hundred bucks.
Speaker 1: So you're talking about then a six year payback period.
Speaker 1: And we'll talk more about payback periods in just a bit.
Speaker 1: But the reason we want to start with insulation is
Speaker 1: of course because it's one of the easiest things and
Speaker 1: there's a ton of homes across this country map where
Speaker 1: people just do not have an insulation, enough insulation, especially
Speaker 1: if you're in an older home in the neighborhood that
Speaker 1: we just moved from. Some of the houses even near
Speaker 1: by us that were built in the thirties, forties, fifties,
Speaker 1: there are a lot of homes that just don't have
Speaker 1: very much and it's just costing you a ton of
Speaker 1: money over time because that one little thing that's not
Speaker 1: terribly difficult to put in and it's not terribly expensive either.
Speaker 1: It's missing, that's right. Yeah, And you know, earlier I
Speaker 1: was I was joking about having like holes in your walls.
Speaker 1: I'm speaking from personal experience. At our old house, we
Speaker 1: could literally stand there at the window and look out
Speaker 1: through a hole between like the window panes and just
Speaker 1: see the ground like they're directly. That can't be good, No,
Speaker 1: it can't be good. Like literal cold air. I could
Speaker 1: stand there and feel the breeze on my face. Well,
Speaker 1: weather stripping counts right as part of this too, exactly. Yeah, yeah,
Speaker 1: you could put some of that stuff in. We're not
Speaker 1: just talking about hiring a crew, yeah, to show up
Speaker 1: and you know, spray foam into that you're attic something truly.
Speaker 1: Something as simple as weather stripping, or there's like this
Speaker 1: special clock out there that's designed to like seal any
Speaker 1: gaps where air might be sneaking through. These all qualify
Speaker 1: as well, so I no longer have to take tilet
Speaker 1: paper and shove it down into into this, which Kate
Speaker 1: would be so mortified to hear me admitting that this
Speaker 1: is something we actually did for a while there. And granted,
Speaker 1: you know the credit that you're going to snag on
Speaker 1: your taxes when you file next year, it's not going
Speaker 1: to be something to write home about when it comes
Speaker 1: to getting that thirty percent rebate that or not rebate
Speaker 1: that tax credit on weather stripping. But every little bit helps, Yeah,
Speaker 1: it really does, and I think it can just be
Speaker 1: the kick in the pants to get this thing done
Speaker 1: and that kind of stuff like it seals up from
Speaker 1: the draftiness of a house and just makes your house
Speaker 1: more comfortable. It has a major impact, and it's saving money,
Speaker 1: which we care about. All right, Let's talk about something else,
Speaker 1: Matt that's kind of on that was involved in that bill,
Speaker 1: and that is when you replace an HVAC unit so
Speaker 1: heating and cooling, replacing your ac or your furnace and
Speaker 1: getting a more efficient one. It's going to cost you
Speaker 1: less thanks to the federal government as well. Now they'll
Speaker 1: call for thirty percent of the cost up to six
Speaker 1: hundred dollars. You've got to meet the seer ratings by
Speaker 1: the way, though, and in most units that are sixteen
Speaker 1: seer or higher I believe should qualify. But should you
Speaker 1: go out and replace your eight year old unit spending
Speaker 1: six thousand bucks in order to get a ten percent
Speaker 1: discount basically because the cap is six hundred bucks, probably
Speaker 1: not right. You probably don't want to replace something that
Speaker 1: is in perfectly good working order. And remember something we
Speaker 1: haven't mentioned yet, but these credits are actually going to
Speaker 1: be around for the next decade, so it's like there's
Speaker 1: no need to rush because they're expiring anytime soon. I
Speaker 1: don't believe they expired till twenty thirty two, So you
Speaker 1: got a lot of time to kind of plan ahead
Speaker 1: and think through replacing some of these items, waiting until
Speaker 1: maybe they're a little bit longer in the tooth. But
Speaker 1: if you got to replace your unit anyway, or if
Speaker 1: it's really really old, like twenty years old or something
Speaker 1: that it's malfunctioning, it's inefficient. Being proactive I think can
Speaker 1: make sense. So hvacts are included in this it's important
Speaker 1: to note if you're replacing one, just don't forget to
Speaker 1: get the tax credit that's owed to you, and don't
Speaker 1: forget to choose a unit that's going to actually qualify
Speaker 1: for the tax credit. Makes me think of heat pumps too,
Speaker 1: mat which you're gaining popularity. They were also included in
Speaker 1: the bill. Yeah, and you know you might be bummed
Speaker 1: to here there's a six hundred dollars cap on the
Speaker 1: new AC unit. Well, the thirty percent tax credit for
Speaker 1: heat pumps comes the two thousand dollars cap. Oh yeah,
Speaker 1: wich means you can spend like sixty five hundred bucks
Speaker 1: on one and still not fully exhaust the credit available
Speaker 1: to you. So it's just important to know that those
Speaker 1: exist because that's that's more money than we're talking about
Speaker 1: with insulation even. Oh yeah, we're talking about a big
Speaker 1: chunk of change on on something like that. Yeah. Notice
Speaker 1: we're going up in the cost of some of these
Speaker 1: upgrades that you can make. But okay, next one is
Speaker 1: even bigger. Yeah yeah, but this isn't permission to be
Speaker 1: like sweetie, we're gonna splurge on the nice heat pump
Speaker 1: because of course you still want You're still having to
Speaker 1: pay for this, and so make sure that you are
Speaker 1: purchasing wisely. It's just like that. We don't want you
Speaker 1: get in the Black Friday mentality where it's like, oh,
Speaker 1: I guess I'll buy three TVs and I didn't need
Speaker 1: It's it's certainly not like that, but it is like,
Speaker 1: oh cool, Yeah, I was thinking about doing this anyway,
Speaker 1: I probably need to do this to my home or
Speaker 1: this unit does need to be replaced. Now it just
Speaker 1: makes it make more sense than it did before. Totally. Yeah,
Speaker 1: so AC units had that six hundred dollars CAP. Heat
Speaker 1: pumps come about two thousand dollars CAP. Will guess what
Speaker 1: solar panels. The cool thing about the Perks and a
Speaker 1: solar install is that there is no cap on the disc.
Speaker 1: On the thirty percent discount that they're offering. My neighbors
Speaker 1: are gonna be shocked when I put solar across the
Speaker 1: whole backyard, and my kids are gonna be bummed because
Speaker 1: then they won't get to play in anymore. They're like,
Speaker 1: why do we feel all that heat radiating didn't it
Speaker 1: like reflect and I think about the solar farms and
Speaker 1: there's always like, yeah, the story is about large numbers
Speaker 1: of birds coming down because they're getting like glazered. Really yeah, yeah,
Speaker 1: I don't know if that's Hey, we'll be able to
Speaker 1: power the whole neighborhood and laser a bunch of birds
Speaker 1: in the process. Yeah, well, we'll see who is actually
Speaker 1: in favor of that. But what this means, so there's
Speaker 1: no cap. That means that you are going to get
Speaker 1: a tax credit for almost a third of your overall
Speaker 1: outlay on solar panels, and so that it doesn't matter
Speaker 1: if you put it in like a ten thousand dollars
Speaker 1: system or one that costs forty or fifty thousand dollars.
Speaker 1: Can't imagine that someone would spend that much, but I
Speaker 1: guess there's the possibility. And on the side of your home,
Speaker 1: I guess yeah, And maybe on the how nice of
Speaker 1: a vehicle your contractors driving? Probably true, And you're still
Speaker 1: gonna want to consider what the paybacks land is going
Speaker 1: to be four installing solar before you go through with it,
Speaker 1: because the average cost of solar installs after tax credits
Speaker 1: is about twenty thousand dollars and that is not cheap.
Speaker 1: This is still a significant amount of money that we're
Speaker 1: talking about spending. But you might get that twenty thousand
Speaker 1: dollars back into your life in the form of smaller
Speaker 1: energy bills and possibly even less than a decade energy stage.
Speaker 1: This is a great site to help you to research solar.
Speaker 1: They'll get you quotes from a bunch of different installers,
Speaker 1: will be emailing you and calling you, and takes you
Speaker 1: out of the blue. I know this from personally. You
Speaker 1: might not want to go that right because it can
Speaker 1: be kind of annoying, but but you will get all
Speaker 1: the information. I'll promise you that. But based on that site,
Speaker 1: the average payback is eight point seven years, So that's
Speaker 1: a good starting point if this is something you are considering,
Speaker 1: if you're trying to decide if getting some panels on
Speaker 1: your roof, if that's going to make sense, And while
Speaker 1: you're at it, you might even throw in some battery
Speaker 1: storage as well, because you know suntn't shine at night
Speaker 1: and any electricity then too. But I love that he
Speaker 1: said about taking that Black Friday mentality. I think the
Speaker 1: average battery system install for a house is something in
Speaker 1: the like the nine thousand dollars range. It's not cheap.
Speaker 1: They can be so expensive, so just make sure you're
Speaker 1: not getting too far out of your skis. You want
Speaker 1: to make sure that you're overall making a smart decision
Speaker 1: for you and your family and specifically with your finances
Speaker 1: in mind. Yeah, and I don't know if you said this,
Speaker 1: but the battery gets thirty percent tax credit as well,
Speaker 1: which is sweet. So even though they're expensive, it's like boom,
Speaker 1: thirty percent off that that's helpful. It doesn't necessarily make
Speaker 1: it a slam donkey. Yeah, got to run the numbers. Basically,
Speaker 1: it's it's like thirty percent off everything. It's like everything's
Speaker 1: thirty percent of storewide sale for the next decade. And
Speaker 1: so but that actually the fact that it's around so
Speaker 1: long and is it going to impact how we talk
Speaker 1: about whether or not you should do it too. So
Speaker 1: we'll get to that in just a second. But let's
Speaker 1: talk about electric vehicles as well, Matt. There were some
Speaker 1: big changes made to EV tax credits in the IRA
Speaker 1: the Inflation Production Act, and one of the biggest changes
Speaker 1: is that buying some used evs now qualifies you for
Speaker 1: a tax break. You can get thirty percent off the
Speaker 1: sale price up to four thousand dollars, which is sweets.
Speaker 1: If you buy a twelve thousand dollars ish EV, which
Speaker 1: is probably going to be one of those cheaper Nissan
Speaker 1: Leaf models, it's a few years old, like you're you're
Speaker 1: basically getting it for eight grand, which is pretty sweet.
Speaker 1: And that's just never been the case before. There was
Speaker 1: never any sort of incentive for you to buy a
Speaker 1: used electric vehicle, but now there is, and that used
Speaker 1: EV now needs to be It basically needs to be
Speaker 1: at least two years old and cost twenty five thousand
Speaker 1: dollars or less. That's what's going to make it meet
Speaker 1: the requirements, but also become harder to decipher which new
Speaker 1: vehicles qualify for this tax credit in which ones don't,
Speaker 1: So that's kind of tough. But there's this price cap
Speaker 1: of eighty thousand dollars on new trucks and SUV's and
Speaker 1: fifty five thousand dollar price cap on EV cars. And
Speaker 1: that's Matt kind of why we've seen Tesla lowering prices lately.
Speaker 1: They want their cars to qualify for this rebate. That's right,
Speaker 1: they think you're going to sell a bunch more units
Speaker 1: right if their customers can get the double wammy of
Speaker 1: a lower price and a tax rebye a rebate. But
Speaker 1: it's important to mention too that this is like one
Speaker 1: of the only ones I think that there's like there's
Speaker 1: a cap on earnings in order to get this rebate,
Speaker 1: that's right. Yeah, you only qualify if you are married
Speaker 1: filing jointly make three hundred thousand dollars or less, or
Speaker 1: if you're a single filer making one hundred and fifty
Speaker 1: thousand dollars or less. So make sure you know that
Speaker 1: if you're a high income earner, you are likely going
Speaker 1: to miss out on this tax rebate. And the cool
Speaker 1: thing though, is that you can actually use your modified
Speaker 1: AGI from the year you take delivery of the vehicle
Speaker 1: or the year before, whichever is less, which is a
Speaker 1: nice little perk. So so if you're kind of having
Speaker 1: trouble figuring out how much am I going to make
Speaker 1: this year, well, if you made enough to qualify last year,
Speaker 1: you can still qualify for this rebate, that's right. But
Speaker 1: that being said, it is important to point out that
Speaker 1: this is a credit that is actually only good until
Speaker 1: tax day, so April eighteenth, bad news for folks out there,
Speaker 1: at least for most EV's available. So because of the
Speaker 1: rules set forth by the government, they're incentivizing evy makers
Speaker 1: to get their battery materials from country is basically not
Speaker 1: named China. There So forty percent of the battery minerals
Speaker 1: need to be mined or process process in the US
Speaker 1: or in countries with which the US has trade deals,
Speaker 1: like Japan, and so the requirement increases every single year
Speaker 1: until twenty twenty eight, when one hundred percent of the
Speaker 1: battery materials need to have battery parts from the US
Speaker 1: or countries we like. So you know, this means that
Speaker 1: only unfortunately, only a few of the ninety one electric
Speaker 1: vehicle models currently for sale in the US are likely
Speaker 1: to qualify for that full seventy five hundred dollars credit
Speaker 1: starting April nineteen. Yeah, and a lot of the manufacturers
Speaker 1: are like actually saying that on their website. You can
Speaker 1: go to Tesla and they say, hey, the amount of
Speaker 1: tax credit is set to be cut in half in
Speaker 1: just a week or so, And so for many seventy
Speaker 1: five hundred dollars is the difference between buying a new
Speaker 1: EV or not, like, especially when the average price of
Speaker 1: a new electric vehicle is somewhere close to sixty thousand dollars.
Speaker 1: That is a big tax cut, and if it no
Speaker 1: longer exists, it's going to influence whether people decide to
Speaker 1: purchase a new car or not. And so if you're
Speaker 1: not quite ready to pull the trigger in the next
Speaker 1: few days, because really that's how much time you have
Speaker 1: to get the full tax credit exactly. Yeah, you might
Speaker 1: want to wait a few years actually, because it's going
Speaker 1: to take a little bit for car manufacturers like GM
Speaker 1: and some of these other other car electric car producers
Speaker 1: to change their battery production locations. And many of these
Speaker 1: companies they think they're going to be compliant by twenty
Speaker 1: twenty five or twenty twenty six. But if you're planning
Speaker 1: on purchasing an EV sometime this spring or even the summer, anyways,
Speaker 1: either pounce immediately or maybe hold off for a little while, yes, right, yeah.
Speaker 1: And in addition to electric vehicles, the actual chargers that
Speaker 1: you can purchase and install, right like it's at level
Speaker 1: two chargers. This is what folks can do that allow
Speaker 1: you to charge up faster at home. So depending on
Speaker 1: if you're driving a whole lot, that could make a
Speaker 1: lot of sense, although you just you just plugged it
Speaker 1: into the side of your house. Yes, so you didn't
Speaker 1: have an actual charger. Less the thing, I think a
Speaker 1: lot of these level two chargers are in the five
Speaker 1: to six hundred dollar range. And yeah, thirty percent off
Speaker 1: is great, but do you actually need it. It depends
Speaker 1: on how much how much range you have on this car,
Speaker 1: and yeah, how much you're driving, how much you're using it.
Speaker 1: I had to leave with like eighty miles range, so
Speaker 1: it wasn't great. But even still, I just by the
Speaker 1: end of it was more like fifty. It gone down
Speaker 1: a little bit over the six years of ownership, but
Speaker 1: like it's it still was. I don't realize you had
Speaker 1: it that long six years. Yeah, that's a chuck of time. Yeah,
Speaker 1: and so it's better for the battery when you trickle charge.
Speaker 1: And so if you don't actually need to get the
Speaker 1: level two charger, save yourself, you know, three four hundred
Speaker 1: bucks even with that thirty percent credit, and just trickle
Speaker 1: charge every night, because yeah, if your lifestyle, if it
Speaker 1: makes sense for your lifestyle and how you drive, I
Speaker 1: don't think people need a level two charge. I think
Speaker 1: people assume buying an ev it has to come with
Speaker 1: that added expense, but I don't think it does. Yeah,
Speaker 1: you just plug it into the USB port. You're good
Speaker 1: to go, right, do that real slow trickle charge. It's
Speaker 1: you know, if you do any of these improvements this year,
Speaker 1: in the year of our Lord twenty twenty three, you
Speaker 1: can claim these tax credits when you file your taxes
Speaker 1: next year, of course, but again, don't let the tax
Speaker 1: tail wag the dog here. And so if your insulation
Speaker 1: situation is already on point, don't rip out perfectly good
Speaker 1: blow in insulation, that cellulose and from insulation just so
Speaker 1: that you can get that fancy spray foam installed, just
Speaker 1: to get that thirty percent discount. Yeah, because that's I mean,
Speaker 1: what do you think about? Spray from is really expensive too.
Speaker 1: It can be like six or seven or eight grand
Speaker 1: or whatever, and so you're getting thirty percent of only
Speaker 1: a portion of that too, because of exactly. Yeah. So
Speaker 1: all that being said, we kind of covered some of
Speaker 1: the biggest ways in order for you to save on
Speaker 1: you know, when it comes to heating and cooling your home,
Speaker 1: just the different energy expenses associated with it. There might
Speaker 1: be some different options that we didn't mention and again
Speaker 1: will link to a full list of some of the
Speaker 1: different equipment upgrades that you can make. Are the most
Speaker 1: enticing things? Yeah, yeah, but it might be overwhelming, right,
Speaker 1: And so if you're at a loss for what to do, right,
Speaker 1: maybe you're not sure which energy efficient upgrades to prioritize.
Speaker 1: It could actually make sense to hire someone to perform
Speaker 1: a home energy audits. Good news on that front too.
Speaker 1: There's a thirty percent tax credit also applies to getting
Speaker 1: an energy audits up to one hundred and fifty dollars,
Speaker 1: which will help maybe get you pointed in the right
Speaker 1: direction so that you know what steps to take get
Speaker 1: the pro to base. I think they usually hook up
Speaker 1: one of those fans or something. They can see where
Speaker 1: the league just leagages are happening in your home, and
Speaker 1: they might say, hey, if you do these this, this
Speaker 1: and that, oh for like the air Yeah, for the airflow,
Speaker 1: they see, yeah, where it's where it's escaping. And so
Speaker 1: I don't know, I've never done one, But they don't
Speaker 1: walk around with a lit cigarette and see where. That's
Speaker 1: all they did that like seventies from the seventies with
Speaker 1: the mustaches, that's how they did it. But no that's
Speaker 1: not how they do it anymore. I don't think so. Yeah,
Speaker 1: it's it's nice. You might want to hire the person
Speaker 1: to come in and and I think some local power
Speaker 1: companies and stuff like that. Matt too, they offer a
Speaker 1: rebate on home energy audits, so you might be able
Speaker 1: to get it for even less than that and kind
Speaker 1: of get that professional insight into what's going on with
Speaker 1: your home energy wise and what upgrades are going to
Speaker 1: be the most effective and impactful. Totally. Yeah, they show
Speaker 1: up with those those infrared heat that's our whole monitor things. Yeah,
Speaker 1: so they'll get you fixed up where you can kind
Speaker 1: of see like Predator from a remember of Predator. I
Speaker 1: don't think ever saw you never saw any of the
Speaker 1: Predator movies either from the eighties Schwarzenegger or like the
Speaker 1: Sigourney Weaver or was she an alien? That's alien? Okay,
Speaker 1: I didn't see those either. Well there's the new ones too,
Speaker 1: like Alien versus Predator. That's what you're thinking of alien
Speaker 1: because of I haven't seen those either. A VP. Oh sorry,
Speaker 1: I like movies, but not those. You're off playing and
Speaker 1: maybe I would like playing basketball. No, you probably wouldn't
Speaker 1: like I wouldn't like him today. Either, Okay, well, let's
Speaker 1: let's keep going, Matt. Let's we got to talk about
Speaker 1: kind of timeline and like which of these energy saving
Speaker 1: maneuvers to tackle first, and then just kind of a
Speaker 1: few other things you need to think through from a
Speaker 1: financial perspective before you start start like calling contractors, going
Speaker 1: to home depot. So we'll discuss a lot of those
Speaker 1: considerations that you need to make. We'll get to that
Speaker 1: right after this. All right, we are back from the
Speaker 1: break and Joel, you know, now that we've covered some
Speaker 1: of the more popular upgrades that we can all make
Speaker 1: to our homes in order to save money, Let's run
Speaker 1: through some questions that we think will be able to
Speaker 1: help us to decide whether or not make sense to
Speaker 1: make those purchases. And the first question is what is
Speaker 1: the overall payoff timeline? And Dude, I think this is
Speaker 1: likely the biggest question that we all need to ask ourselves. So,
Speaker 1: for instance, like we were talking about the average payback
Speaker 1: period for solar earlier being eight point seven years, and
Speaker 1: so depending on the price of solar installs where you live,
Speaker 1: a lot of that has to do with competition, how
Speaker 1: many different installers there are buying for your business. It
Speaker 1: could be plus or minus a few years on that
Speaker 1: eight point seven years. Yeah. Plus. It depends on the
Speaker 1: environment where you live too, Like you're like, oh, I
Speaker 1: live in such and such a place Tucson where the
Speaker 1: sun is bright and shiny, and you might pay off
Speaker 1: a lot quicker than let's say you live in rural
Speaker 1: Oklahoma or something like that you see in Oklahoma is
Speaker 1: not sunny. I don't know, is it. I'm just making
Speaker 1: it again like Portland or I don't know, somewhere where
Speaker 1: it's like sunny is tuson super cloudy. But it's just
Speaker 1: important to figure out the number for your specific situation
Speaker 1: if you're going to drop potentially over twenty thousand dollars.
Speaker 1: But yeah, like if you live out in the desert,
Speaker 1: you love your home, and you're planning to be there
Speaker 1: for years to come, this could be a really smart upgrade.
Speaker 1: It would allow you to save a decent chunk of
Speaker 1: money over the years. But dude, I wouldn't go through
Speaker 1: the hassle of doing this if I was just planning
Speaker 1: to be there for like another couple of years or
Speaker 1: you know, like a year from now. So as you're
Speaker 1: calculating the payoff timeline. Yes, you crunch the numbers and
Speaker 1: figure out what the savings are going to be where
Speaker 1: it's like theoretical savings right, like you're looking at it
Speaker 1: on paper. But you also need to make sure that
Speaker 1: you're considering how likely it is that you are going
Speaker 1: to stay in that particular home. It needs to not
Speaker 1: just makes sense from a utility standpoint, but it needs
Speaker 1: to make sense for you and how long you are
Speaker 1: planning to own that home. Just because there's a thirty
Speaker 1: percent discount, if you can only use that item for
Speaker 1: six months, then it's probably not going to make sense
Speaker 1: to go ahead and buy that item, even if you're
Speaker 1: getting the sweet discount on your taxes, right, even when
Speaker 1: you go to solar stage and they're like, oh, your
Speaker 1: roof is perfectly situated, like you get a like out
Speaker 1: of one hundred, you get ninety nine, Like there are
Speaker 1: very few homes that are as well situated for solar.
Speaker 1: It doesn't really matter if you're not planning to stay
Speaker 1: there for the long haul, yep, exactly. So you want
Speaker 1: to take those things into account, but then you got
Speaker 1: also take here your personal situation, that personal payoff timeline
Speaker 1: into account simultaneously, and you also have to take into
Speaker 1: account the perceived value of the upgrades, because while we're
Speaker 1: talking about solar, it's also important to note that you
Speaker 1: might be able to recoup some of your costs when
Speaker 1: the time comes to sell. So that's a fact that
Speaker 1: it's true to consider. I think homeowners value a solar
Speaker 1: installation or home buyers value that solar install decently well.
Speaker 1: But then other things that you might do they might
Speaker 1: not value in nearly the same way. And so yeah,
Speaker 1: depending on the buyer, an upgrade like insulation, it might
Speaker 1: not net you any price increase when you're selling, but
Speaker 1: solar is going to net you something. It might not
Speaker 1: net you the full price. You know that you're paid
Speaker 1: out of pocket, but it's at least going to it's
Speaker 1: at least going to make a difference than the sales price.
Speaker 1: But basically, if you do unexpectedly have to move before
Speaker 1: you've had a chance to reap the financial benefit, you're
Speaker 1: likely going to get some dollars back in the form
Speaker 1: of a higher sales price with solar. But you want
Speaker 1: to think about, okay, cool, which of these upgrades is
Speaker 1: going to make is going to actually make a difference
Speaker 1: in the value of this home. A lot of these
Speaker 1: upgrades are not going to make a meaningful difference in
Speaker 1: the value of the home. So you've got to really
Speaker 1: think about it from more of like a personal standpoint,
Speaker 1: thinking of it less than like, well, how much is
Speaker 1: this going to improve the value of my home? And
Speaker 1: more like how much is this going to improve the
Speaker 1: energy efficiency lower my bills? And how much of that
Speaker 1: savings am I actually going to benefit from? Because honestly,
Speaker 1: I think it can be tough to forecast what buyers
Speaker 1: are going to prioritize when it comes to buy in
Speaker 1: certain homes, because I do think that when there's a
Speaker 1: listing and you can see those nice panels facing south
Speaker 1: like they're on the roof like, it has an impact
Speaker 1: on the curb appeal, whereas something like installation, like nobody
Speaker 1: sees that in the listening, like there you know, there
Speaker 1: hardly is ever a picture of the attic. Right occasionally
Speaker 1: that is the case. And I knew, like, not this
Speaker 1: past house that we bought, but the one before that
Speaker 1: I knew walking in there there was there was foam
Speaker 1: insulation in the attica and under the floor. We had
Speaker 1: a picture of it. Yeshn't there are in an actual
Speaker 1: picture of it in the listing. I don't remember, but
Speaker 1: all I feel like I remember I remember valuing that
Speaker 1: highly as an individual, but as a homeowner absolutely. But
Speaker 1: I know most people who are buying a home, they
Speaker 1: don't see that they're looking at, like the color of
Speaker 1: the walls. They're looking at, and they are noticing, Okay,
Speaker 1: guess what the solar For some reason, it makes sense
Speaker 1: for people that they're going to save money on bills
Speaker 1: every month, but the insulation not nearly as much, and
Speaker 1: so people just don't value it in the same way. Well,
Speaker 1: essentially you're talking about here is focusing on like more
Speaker 1: of the passive upgrades that we can make. And I
Speaker 1: think the more passive, simple strategies make them a sense
Speaker 1: because I mean, if if it's simpler, if there's less
Speaker 1: technology involved, that less likely it is to break. Right, Like,
Speaker 1: I'm not saying that solar panels break a lot, but
Speaker 1: I guarantee that they break more often than foam insulation
Speaker 1: to one they need be cleaned once a year, and yes,
Speaker 1: it's required exactly, And so I think for that reason
Speaker 1: it makes sense to kind of go with the lowest
Speaker 1: hanging fruit first, Like These are the home modifications I
Speaker 1: think that are going to provide the biggest bang for
Speaker 1: your buck because though it may not be sexy, it's
Speaker 1: also not as expensive insulation specifically, right, I guess I'm
Speaker 1: still thinking about spray foam. It's not going to be
Speaker 1: as expensive as like an electric vehicle or a brand
Speaker 1: new AC unit, or like installing some skylight. So why
Speaker 1: not get the most substantial savings first where you can
Speaker 1: immediately see a return on your investment, and then you
Speaker 1: can do some of those other upgrades in future years. Again,
Speaker 1: these credits are going to be around for basically a decade,
Speaker 1: so there is no rush, and these are different upgrades
Speaker 1: that you can make strategically over time. Yeah. I think
Speaker 1: one other consideration map because you just mentioned that, Yeah,
Speaker 1: these credits are going to be around for a while,
Speaker 1: is that waiting could mean you are able to buy
Speaker 1: better technology at an even bigger discount. Yeah, that's another
Speaker 1: another benefit. That's another pro to waiting is that installation
Speaker 1: it's not gonna improve much from the technology side. But
Speaker 1: guess what solar panels, battery technology, all of these things
Speaker 1: are electric vehicles statistically improved. Yeah, so think about the
Speaker 1: electric vehicles on the used car market that are going
Speaker 1: to be available three, four or five years from now,
Speaker 1: or the technology and solar panels, you might get solar
Speaker 1: panels that just are better, perform a whole lot better
Speaker 1: than the ones that like, you could currently buy. So
Speaker 1: if you want to install solar, yes, you are missing
Speaker 1: out on potentially years of the sun lowering those energy
Speaker 1: bills month in and month out, But you might get
Speaker 1: a superior system in a few years time for fewer dollars. Overall,
Speaker 1: that's important to mention, and I really do think the
Speaker 1: same thing is going to be true with electric vehicles.
Speaker 1: Like battery technology continues to progress, continues to move forward,
Speaker 1: and so yeah, so maybe even today's Rivian's matt might
Speaker 1: be like discarded, It might be a whole lot cheaper
Speaker 1: five years from now. We just don't know. So much
Speaker 1: depends on what comes down the pike and how quickly
Speaker 1: some of this new tech gets implemented into cars in
Speaker 1: the near future. So yeah, just know that the technology
Speaker 1: could change. And because these tax credits are going to
Speaker 1: be around for basically a decade, there's no need to
Speaker 1: rush into it and get something up on your roof
Speaker 1: or get that new car in your garage immediately, totally. Yeah,
Speaker 1: today's Rivians could be tomorrow's Leafs, depending on the technology.
Speaker 1: I mean, I remember when those leaves came out and
Speaker 1: people were in awe and eighty mile range even was
Speaker 1: like nobody cared because it was this brand new thing,
Speaker 1: and pretty quickly they were basically resigned to the junkie
Speaker 1: and most people to lead. Yeah, because no car comes
Speaker 1: with less than like a two hundred mile range now. Yeah.
Speaker 1: So another maybe argument for just waiting a little bit
Speaker 1: or at least not rushing things is if you don't
Speaker 1: have the cash on hand in order to actually make
Speaker 1: those purchases without incurring any debt. And for some of
Speaker 1: these energy efficient upgrades, it's going to take a decent
Speaker 1: amount of cash in the bank in order to make
Speaker 1: this happen. Even with these healthy tax credits, do you
Speaker 1: have the funds to dedicate towards these energy efficient upgrades.
Speaker 1: We want to make sure that you just have, you know,
Speaker 1: a solid savings and that they're healthy enough for you
Speaker 1: to take on some of these expenses. Joe, we talked
Speaker 1: about the money gears last week, and I don't know,
Speaker 1: for you know, if we're going to say that there's
Speaker 1: a hard line, like a hard point or a specific
Speaker 1: money gear that you need to be in in order
Speaker 1: to start thinking about some of these upgrades. But I'll
Speaker 1: say if it was me, I would at least want
Speaker 1: to be out of money gear number four, where you've
Speaker 1: got that solid three to six months worth of living
Speaker 1: expenses set aside. Like ideally, ideally you'd be in money
Speaker 1: You're five, where you're investing a large percentage of your
Speaker 1: income towards hirement before you're looking at some of these
Speaker 1: more fun and interesting ways to get creative on the
Speaker 1: home front in order to reduce your expenses. Yeah, it's
Speaker 1: going to be different for everybody, because again it kind
Speaker 1: of depends on how much you value having an energy
Speaker 1: efficient home. But there are are there are some basics
Speaker 1: that we want to make sure that folks are paying
Speaker 1: attention to before they're looking at some of these more
Speaker 1: creative ways to reduce their footprint. But then again, some
Speaker 1: of them at print can be really really cheap, right,
Speaker 1: and so exactly we're talking about some of that talking
Speaker 1: about weather's dripping, go for it. Yeah, it's like you
Speaker 1: can probably incorporate that into your budget now, even if
Speaker 1: you're not kind of running on all cylinders. When it
Speaker 1: comes to those money gears, if you haven't made as
Speaker 1: much progress as you like, you could probably still prioritize
Speaker 1: some of these. You probably don't want to necessarily plug
Speaker 1: down for the brand new electric vehicle. You might want
Speaker 1: to offer the used electric vehicle that you can pay
Speaker 1: cash for or whatever. But these are the kind of
Speaker 1: things where yet some of them are more expensive than others.
Speaker 1: And how much money do you have on hand that
Speaker 1: is going to impact whether or not or and when
Speaker 1: you should actually be doing some of these things and
Speaker 1: making some of these changes to your home in order
Speaker 1: to hopefully save you money. And I do want to
Speaker 1: also say, Matt, it doesn't always take money to save money.
Speaker 1: I think sometimes we get to thinking that we got
Speaker 1: to make these upgrades in order to save money. But
Speaker 1: some just changing the setting on your thermostat you don't
Speaker 1: even need necessarily the news sweet obviously coolness thermostat, you
Speaker 1: don't necessarily have to have that. Yes, it can save
Speaker 1: you money over time, but also your own actions can
Speaker 1: save you money. And so I think sometimes we look
Speaker 1: to replacing items or adding in new insulation, it's not
Speaker 1: that Yeah, there's a lot of benefits now with these
Speaker 1: additional tax credits that make them make more sense. But
Speaker 1: there are other things we can do, like putting on
Speaker 1: a sweater in the winter right to prevent turning on these.
Speaker 1: But on those thermals, Yeah, it doesn't have to be
Speaker 1: making actually proactive moves and spending more money in order
Speaker 1: to save money. Those those marino wool thermals, I've never tried.
Speaker 1: You probably have something, don't you. It actually does. I
Speaker 1: don't like, I'm not out. Yeah that sounds like some
Speaker 1: of you. This is a tangent that we don't necessarily
Speaker 1: need to go down. Well, let's mention too annual caps
Speaker 1: on these, because yeah, assuming you're good to go after
Speaker 1: running through all the factors that we've just laid out
Speaker 1: that you need to consider, you're still need to keep
Speaker 1: in mind that there are annual caps on the amount
Speaker 1: of deductions that you can take. So staggering upgrades across
Speaker 1: multiple years it could be a good idea because it
Speaker 1: might not take long before you hit the limit in
Speaker 1: a single given year. And the goal is not to
Speaker 1: maximize the tax savings in any singular year, but it's
Speaker 1: really to maximize tax savings over the long haul, and
Speaker 1: so the overall total limit for an efficiency tax credit
Speaker 1: in one year is three thousand, two hundred dollars. So
Speaker 1: the limit includes a maximum credit of twelve hundred dollars
Speaker 1: for any combo of home energy improvements including windows, doors, skylights, insulation,
Speaker 1: and electrical By the way, we didn't talk about some
Speaker 1: of those specifics just because they really do get into
Speaker 1: the weeds, but will link to that Department of Energy
Speaker 1: graph in the shout up so you can see kind
Speaker 1: of everything else that's included in this bill. But yeah, furnace, boilers,
Speaker 1: central air conditioners, they're included in that too. The remaining
Speaker 1: two thousand dollars credit is available with any combo of
Speaker 1: electric or natural gas, heat pumps, heat pump water heaters,
Speaker 1: and biomass stoves and boilers. So yeah, there's a lot
Speaker 1: to dissect, but you really, when we're talking about saving
Speaker 1: money on taxes, you want to make sure you're not
Speaker 1: just like trying to match it out in twenty twenty
Speaker 1: three do everything at once. You might want to do
Speaker 1: some things in twenty twenty three, some in twenty four,
Speaker 1: some in twenty five, and kind of pace yourself when
Speaker 1: it comes to the improvements you're making. Yeah, yeah, I
Speaker 1: like that idea pacing yourself, and so Form fifty six
Speaker 1: ninety five that is the IRIS form that you're going
Speaker 1: to need in order to take advantage and claim these
Speaker 1: different tax credits. So just yeah, Form fifty six ninety five.
Speaker 1: Store that on a way to your memory because you're
Speaker 1: not going to be This isn't something you're necessarily going
Speaker 1: to be doing now. You'll be doing this next spring
Speaker 1: as you're filing your twenty twenty three taxes next year
Speaker 1: in twenty twenty four, But just make sure you tell
Speaker 1: your tax preparer you will want to enter it into
Speaker 1: your online tax prep service, whichever one you use. And
Speaker 1: on the note of mentioning tax forms before you start
Speaker 1: freaking out in Joel, you know, we kind of suched
Speaker 1: on this. You can take these energy tax credits while
Speaker 1: also taking the standard deduction, which is pretty sweet that
Speaker 1: you can get these incentives, take advantage of these. I
Speaker 1: don't want to call them rewards, but these these these
Speaker 1: tax credits or something tax credits, yeah, or something that
Speaker 1: you can be a part of without complicating your taxes.
Speaker 1: If you don't need to atomize your taxes, you can
Speaker 1: just take that standard deduction. And by the way, if
Speaker 1: you're looking for sort of like a one stop shop,
Speaker 1: that can be really helpful when it comes to figuring
Speaker 1: out which upgrades will kind of net you a tax credit,
Speaker 1: go check out Rewiring America will link to that in
Speaker 1: the show notes. But they've got this awesome calculator there
Speaker 1: that allows you to see what tax credits that you're
Speaker 1: going to be eligible for based on your specific situation,
Speaker 1: based on your income, based on your zip code where
Speaker 1: of dependence, Yeah, where it is that you live, and
Speaker 1: so we will most definitely link to that in the
Speaker 1: show notes. Yeah, that's really cool if you don't want
Speaker 1: to kind of dig through all of the Department of
Speaker 1: Energy stuff or i RS dot gov like, you could
Speaker 1: spend a lot of time on those websites trying to
Speaker 1: figure everything out, and Rewiring America has put put it
Speaker 1: all into a pretty helpful calculator that's definitely worth checking out.
Speaker 1: All right, So we talked about what's up with these
Speaker 1: different energy tax credits, Matt. We mentioned a lot of them,
Speaker 1: not all of them, but there are there are more
Speaker 1: that you can check out that all the fun ones
Speaker 1: that people are most likely to do, right, and we
Speaker 1: dove into some of the specific upgrades that people can make.
Speaker 1: We talked through some of the different questions that we
Speaker 1: can all ask ourselves to determine whether or not it's
Speaker 1: going to make sense for us as individuals to take
Speaker 1: the plunge and think some of that money into our homes.
Speaker 1: Banking on a comfort your house, but also the house.
Speaker 1: It's going to save us some money house. It's going
Speaker 1: to actually like give us some tax credits back at
Speaker 1: the same time. So hopefully this was informative and you
Speaker 1: can use some of the incentives that now exists that
Speaker 1: previously we're greatly diminished. Now they've gotten so much better,
Speaker 1: and just kind of the fact that we have a
Speaker 1: long horizon, a long outlook on how long these things
Speaker 1: are going to last. You can start to make plans right.
Speaker 1: There's no rush to do anything today, get on the
Speaker 1: phone with a contractor tomorrow, but you can start to
Speaker 1: use this timeline and plan out your home upgrades not
Speaker 1: only to make them more comfortable, but also to save
Speaker 1: us money. Wants you to kind of at least think through.
Speaker 1: Now that we know we know the timeline, we got
Speaker 1: basically a decade to think through when how where we
Speaker 1: make these We make these moves to our homes, and
Speaker 1: hopefully you can get the best bang for your buck
Speaker 1: over the long haul when it comes to these energy
Speaker 1: efficient upgrades that you're looking to make. Yeah. Yeah, And
Speaker 1: another quick thing too, I just thought of. I think
Speaker 1: it's just helpful to put these on a radar because
Speaker 1: I think there's a good chance that for all the
Speaker 1: homeowners out there, you might be in your home longer
Speaker 1: than you think this. We're not going to turn this
Speaker 1: into a real estate episode, but Joel, you know, you
Speaker 1: and I we've been talking recently how because of the
Speaker 1: higher interest rates, folks are likely going to stay put
Speaker 1: in the homes that they already have, And so what
Speaker 1: makes sense to be thinking ahead because the longer you
Speaker 1: stay in your home, the more some of these upgrades
Speaker 1: makes sense. Yeah, so that's another reason that maybe you
Speaker 1: should consider some of these different upgrades. But Joel, let's
Speaker 1: quickly talk about the beer you and I enjoyed, a
Speaker 1: Biebo Pills Nerve. This is a beer by Creature Comforts
Speaker 1: Brewing Company out of Athens, Georgia, home of my alma mater,
Speaker 1: and Creature Comvers specifically make some fantastic beers. Honestly, I
Speaker 1: really want to have more of their beers here on
Speaker 1: the show. But what were your thoughts on this one?
Speaker 1: All right, this one was clean, it was crisp, It
Speaker 1: was just like I remember it. Man, It's it's just
Speaker 1: like light and tasty, but without being without having too
Speaker 1: much flavor, Like a pilsner is really just kind of
Speaker 1: like beer that your uncle drank. But this is a
Speaker 1: much improved version. Yeah, it's had some nice biscuity flavors,
Speaker 1: but it drank like a clean biscuit. Yeah, and drink
Speaker 1: like a biscuit that's been like on a juice cleanse
Speaker 1: or something. But yeah, this is just again a craft pilsner,
Speaker 1: and so it's going to taste a lot better than
Speaker 1: the mass produced pilsners that you're going to find at
Speaker 1: your standard grocery store. But we would recommend you check
Speaker 1: out Creature Comforts because they really do make some amazing,
Speaker 1: world class beers. Plus, it's always fun to hit up
Speaker 1: a brewery in a college town as well, So if
Speaker 1: you're ever in Nathan's, you can swing by there and
Speaker 1: drink some of those beers there in person. Joel, that's
Speaker 1: going to be it for the specific episode. Listeners can
Speaker 1: find our show notes up on the website at howamoney
Speaker 1: dot com. We'll link to the many different resources that
Speaker 1: we mentioned during this episode and until next time. Best
Speaker 1: Friends Out, Best Friends Out,