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How green home upgrades can save you money

September 2, 2016
With the help of tax credits and insurance discounts, the sizeable initial investment can be reduced enough to make green homes an affordable reality for many.

We all want to do more to preserve the environment and prevent excessive pollution, but only recently has technology allowed the average consumer to realistically achieve these goals. The cost of implementing the necessary design and equipment has also been steadily decreasing. That's especially true since most “green" tech aims to use less energy and produce less waste. This naturally leads to savings on gas, electric or water bills, but in many cases, a significant investment upfront is still needed. With the help of tax credits and insurance discounts, however, the sizeable initial investment can be reduced enough to make green homes an affordable reality for many.

Energy-saving basics

The best way to save the most money on energy costs is to start from the ground-up, if possible. The U.S. Department of Energy provided a helpful online guide focused on designing a home with efficiency in mind. What makes a home truly green is based on a huge number of factors, and is ultimately up for interpretation. The primary areas of focus for energy conscious owners include:

  • Appliances and electronics
  • Insulation
  • Lighting
  • Heating and cooling
  • Water use and heating
  • Windows and doors

Depending on budget and building abilities, homeowners can approach a green update in two ways. If the home has yet to be constructed, builders and owners will want to look into ways to implement energy-efficient design from the outset. In already constructed homes, owners will want to receive an energy audit to determine what aspects of the home would benefit most from a green update.

Green home insurance

"Green home upgrades can save money on insurance as well.”

Homes designed and built with energy-saving techniques and appliances are often more valuable than similar conventional homes. This is why homeowners should look into an insurance policy designed specifically for green homes. The National Association of Insurance Commissioners explained that a green homeowners insurance policy could cover the cost of replacing specialized, green-certified materials, which may exceed the coverage amounts of typical policies. Some insurers may even offer to replace damaged parts of a conventional home with green materials, for an additional cost. This gives green home owners significant flexibility when it comes to insurance.

Green mortgages

There are even ways to use financing from a mortgage to upgrade home systems to more efficient counterparts, which can cut down on utility expenses and save money in the long run. The U.S. Department of Housing and Urban Development offers Federal Housing Administration loans that can be used to fund the costs of green tech purchases and installation. By providing homeowners the option to cut down on their utility expenses, the FHA program hopes to ensure borrowers are even more capable of paying down their mortgage than they otherwise would be. This can make FHA borrowers more attractive to banks.

All in all, there are plenty of ways green home systems can take a load off a homeowner's finances, not to mention provide the peace of mind that comes with knowing they are making a small difference in the world.