Saving with solar power
Guest Post: Kevin Gibson
If I told you there’s a minimal risk investment that could return 16% per annum, would you be interested?
I have known Madalyn for about ten years now and although our common ground is horses, we usually end up in discussions around politics and economics. I have read with interest her blogs on money and offered this piece as a guest contribution to her ‘gocashflownow’ site.
In terms of ‘Money Models,’ mines about to change dramatically as I will be retiring in a few months. I will go from a 6 figure, tax free income to a zero income scenario. That’s kind of a scary change in lifestyle. So a big question is how I get my capital to work for me in this economy. Well obviously passive income is good and we do have some income from property rental, but an alternate is rather than using capital for income how about reducing your expenditure.
So about 18 months ago I decided to install a grid tied solar panel array. Most people would agree that solar powered electricity would be a better solution for the planet, but the cost still seems to be a deterrent to residential systems. Going solar might be easier and cheaper than you think, but you have to do some research and math. I’ll talk later about some of the options available but let’s start with the example of my system.
The nice thing about grid tied is you don’t have to worry about peak loads or getting through cloudy days. When you generate excess electricity it is pushed back to the grid on a separate meter . When you’re not generating enough power you pull from the grid through the regular meter. The difference in the two meter readings is charged if you used more than you generated, or is credited in kWh (kilo Watt hours) if you’ve over generated.
SYSTEM SIZE: My old electricity bills, which I could download on-line, showed I used 12,000 kWh in a year. This varied from 730 kWh in spring to a peak of 1,400 kWh in August when the A/C was running. So I needed a system that averaged 1,000 kWh per month or 33.3 kWh per day. So the next question was how much sunlight do we get here in Snowflake AZ. There are published maps and charts of average sun hours for our location (see resource’s at end) from these we get an average of 6 sun hours per day.
So for 33.3kWh in 6 hours of sun I need a power rating of 33.3/6 = 5.56kW
There is loss due to inefficiencies of about 10% so 5.56*1.1 = 6.1kW
So the solar panels are connected to a controller and inverter and the size that covered my requirements was nominally 6.3kW with 28 solar panels which were ground mounted.
SYSTEM COST: To connect to the grid the system must be installed by an approved contractor, this is also required to apply for the benefits or rebates available. I got quotations from 3 contractors and then haggled down a few hundred.
So the cost break down:
System hardware $18,000
System installation $18,000
Power Company Rebate – $18,000 that was $3 per watt on a 6kW system
Federal Tax rebate – $5,400 that’s 30% of final cost to owner
Total cost of system $12,600
SYSTEM PERFORMANCE: The system came on line early Jan 2010 and generated 11,016kWh of power. Regretfully we had a problem with the controller and lost 6 weeks of power from half the panels. The loss was refunded by the vendor as the equipment was on a 7 year guarantee. To date this year we have generated 6,360 kWh of power and are ahead of target of 1000kWh/month. So in a typical year we expect to generate the 12,000kWh that we designed for.
COSTS ANALYSIS: You may have seen figures for cost of electricity for different states. Here in Arizona that cost is supposedly 10cents/kWh. However when I took a closer look at my electricity bill, there were additional transmission costs, service costs and taxes all proportional to the kWh used. In the final analysis I paid $8.80 to have the meter read and 16.7c/kWh for my power.
12,000kWh of power at cost of 16.7cents/kWh = $2004 per year. That’s a return on my $12,600 of 15.9%, and you won’t match that in today’s market. Another way to look at it is that the system will pay for itself in 6.28 years at the present cost of electricity. In the next few years I would expect an increase in power cost, so the payback may well be less than 6 years and there after my electricity bill is $8.80 per month to have the meter read.
A tricky part of retirement planning is knowing how long to live. If I die in the next five years I have plenty of money, if I live to 100 things might be tight. We plan everything on 30 years. If we make it that far we’ll sell all assets and move into assisted living. When you start looking at time frames like 30 years the numbers get more dramatic at 3.5 % inflation we would have needed $100,000 to support our electricity habit.
Now if you don’t have the capital to invest immediately, you might still be able to go solar by using a rent and purchase agreement. There are several companies offering this kind of agreement, where basically they install the equipment; you keep paying the electricity bill as usual and after several years the equipment becomes yours. So you’re no worse of for the next few years, then you get the benefits afterward and all the time you’re helping the planet.
RESOURCES:
Solar maps
Solar/Rent purchase
Photo credit: Flicker via creative commons
Memorial Day Videos
For those who did not get on your computer on memorial day I thought you would enjoy some of the videos that were available.
Mike Mansfield
Amazing Grace
Ring of Freedom
We are so blessed to live in America. Madalyn
Photo Credit: Creative commons
Network Marketing: Wanted – responsible, self sufficient, alert, renegade dreamers and creators.
Do you ever think you might not really be from the planet earth? Like you are just not like most people and don’t naturally fit in with, well, lets just say, normal people? I have felt this way many times myself and the truth is, I don’t enjoy working with just anyone. The Winslow personality test I took as part of my Kiyosaki, Rich Dad education has helped me define who I love to work with.
Whether it is a horse client wanting to use holistic care, a horse owner wanting to learn how to learn my horse temperament typing system or one of my network marketing partners, I get along best with a certain type person.
These are the characteristics of the people I love to work with:
Responsible
Self sufficient
Alert and eager
Renegade, system busters
Dreamers and creators
The challenge I have had is that with these characteristics I am not a match for conventional network marketing techniques that teach you to seek and build relationships with all kinds of people. I am not saying this tried and true system of network marketing is wrong, because look at all the people who have succeeded with it. It is not wrong but it sure was tough for me.
The experience of cold calls and reconnecting with past acquaintances helped me develop some better social skills but I dreaded it. I kept thinking I would enjoy this aspect of network marketing more as I got better at it but I never did.
Being the free spirited person that I am I was not consistent at doing something I did not enjoy and I did not feel good training anyone to do something they did not enjoy. So, how have I built my network marketing team? Slowly, steadily over time with people I was initially comfortable with and have gradually come to love.
Although I am once again bucking the system, I believe my online network marketing approach will allow me to reach others like myself who may not be a match for conventional network marketing but would love the approach of building steadily a solid residual income. And I think growth will happen much faster by reaching out to others over the internet.
So:
Do you feel like a martian when it comes to fitting into society?
Do you prefer hanging out with your pets over people?
Do you believe most rules apply to other people?
Do you have dreams but few people to share them with?
Despite what you may have found of been told, you can be very successful in network marketing. You just need some fellow martians to hang out with. Madalyn
Interested in increasing your cash flow monthly ?
Photo credit: http://www.flickr.com/photos/soapylove/1526876824/
Money Smart Skills: Plug your cash flow monthly leaks!
I have a slow leak in my bath tub drain and to take a hot bath I have to keep the water running until I am finished. Because I don’t like to waste water I take very few baths.
Negative cash flow monthly is like a leaky drain. You have to keep working harder and harder to keep up because if you stop to take a breath all your money simply disappears. Believe me, I used to live this way every month until I learned how to plug my cash flow monthly leaks.
Here is what has worked for me:
I pay all my business expenses with a check or a business credit card which I pay off every month. This allows my book keeper to track expenses and I don’t have to worry about keeping up with cash receipts.
I withdraw a certain amount of cash each week and pay most of my non business expenses with cash. I do not have an ATM card so I am not tempted to get extra cash when I have an urge to spend.
I have 1 personal credit card for paying monthly expenses such as the Electric bill, home phone and TV satellite. I have only the basic channels since I don’t watch much television. I rarely, if ever, rent movies. I don’t keep this card with me so I am not tempted to use it.
When I do occasionally carry a business credit card balance I transfer this to a lower interest, credit line for automatic payment with a set amount until it is paid off. This forces me to trim back my spending until the card is paid off.
You may be noticing a pattern here. I set my spending habits so it is harder for me to over spend. I force myself to cut back when I am not able to pay my credit cards in full each month. By plugging my cash flow monthly leaks I have been able to stay out of bad debt and keep my credit rating good. I feel blessed to have a very full life. Madalyn
Don’t be shy. I love your comments even when you disagree with what I write.
Check out: Money smart strategies for the recession economy
Photo credit: http://www.flickr.com/photos/editor/84400947/
My Mind all a Twitter
Do you ever wonder if your DNA can change as you get exposed to new things? My virtual assistant, Stephanie, has always handled my social media chores but lately I have been learning how to do more things myself. Talk about getting out of my comfort zone!
I have now personally tweeted several times and, heaven forbid, I have a facebook page. Not only that, but I have posted and pinged my own blogs. I have gone to online photo sites such as flicker to find the perfect pictures. I have inserted pictures and attributed credit when needed. I have grabbed other people’s blogs and posted them on mine.
The amazing thing is I have had fun doing all these things. Something has shifted in my DNA and I am able to think in short snippets of information. I can tell if I like someone by looking at 2 sentences of a tweet. It is weird.
Part of learning anything new is asking for and accepting feedback. Please give me comments about what you like or don’t like and what you would like more of. Madalyn
Photo credit: http://www.flickr.com/photos/toadstool_ring/ / CC BY 2.0
Why Structure Is Your Friend (Even When You’re a Free Spirit)
Guest Post: Why structure is your friend
Molly Gordon
Two years ago my mastermind buddy, Mark Silver suggested we meet daily in an online forum to post our intentions and goals. The idea was that we could help each other be accountable.
I gagged.
But I set up the forum anyway, and played with setting monthly goals and daily actions.
Mostly what I actually did deviated quite a bit from what I said I would do. I’d spend an afternoon doing “research” on the Internet instead of writing an article. Or I’d begin writing a new ebook instead of writing the landing page for an existing one.
After a few months I got something that I kind of knew in the first place: I’m a highly distractible human being.
Like I said, I already knew that. But keeping track of how that played out on a daily basis showed me the cost of not following a system. It also gave me the practice I needed to be more structured.
Activity isn’t action
Activity is bustle and busyness. It can as easily mean running in circles as creating a result. And activity can keep you busy as all get out with little or nothing to show for it.
Activity stimulates your nervous system. It feeds on adrenaline, which can make you feel like you’re getting a lot done. It’s addictive, in its way, even when it isn’t particularly pleasurable.
Action, on the other hand, is taking a specific step, moving systematically toward a stated goal. Even when you aren’t completely certain about what action to take, deciding on the next step and taking it will more you forward. But a single action may not feel immediately rewarding. It generally takes a sequence of actions to generate pleasurable momentum.
Momentum is worth short-term restlessness
One of the chief excuses for free associating instead of planning is that choosing and following through on specific actions seems rather boring, even unnatural–especially when it means resisting the siren call of bright shiny objects.
But restlessness is a short-term response to the modest stimulation of small actions. When you repeat enough small actions toward a single goal, momentum starts to build. Once you experience this momentum, the restlessness goes away.
Momentum means deferred gratification
Sticking with small actions until momentum starts to build means deferring gratification. And one of the myths of self-employment is that it ought to be gratifying. After all, few people quit their day jobs so they can do what they don’t particularly want to do.
So it’s natural that you might prefer to free associate your tasks rather that structure them and follow a plan. You might even think this is your right as an Accidental Entrepreneur.
But building momentum toward a result means doing the scut work along with the engaging pieces. And it means staying on task for a sustained period, otherwise you end up with a bunch of partly completed projects. (Which is one way to keep yourself from generating income. It’s hard to sell what isn’t complete.)
Gratification does come
Fortunately, deferred gratification doesn’t mean no gratification. Once momentum kicks in, the rewards are many, not least increased confidence, a sense of purpose, and a complete work product.
And then there’s self-knowledge.
It’s remarkable how much you can learn about yourself if you stay awake while you transition to structured action.
Know thyself, be more whole, and earn more money
You might not automatically associate self-knowledge and wholeness with a bigger income. But the three go together when you’re self-employed.
You mileage may vary, and here’s a sampling of things I learned about myself as I moved toward a more structured way of working.
Not feeling like doing something has nothing to do with whether or not I can do it, and do it well.
This was a revelation. I discovered that I could step through writing an article or an entire workbook whether or not I felt like it. And the work was as good, if not better, when I felt some resistance.
Distractibility is directly related to fear of failure.
When I’m stumped or lacking confidence, it’s a lot easier to chase a bright shiny object than to stick with what’s in front of me. I learned that fear of failure is not terminal. I can work when I’m afraid as well as when I’m not, so long as I remain aware and patient with myself.
Productivity is profitable, and that feels good.
Who knew that being productive could make earning a profit feel so good? And I don’t mean only in the sense that it’s nice to make money. I mean that there is a relationship between creating and earning that feels generative and right.
The results are worth the learning curve
Focus and structured action don’t need to come naturally. You can develop these skills by practicing and noticing your process. Don’t beat yourself up for deviating from the path, just notice what’s going on and be curious about that. Keep setting goals and defining the steps. Keep noticing what happens. You will get the hang of it.
Photo credit: http://www.flickr.com/photos/aresauburnphotos/ / CC BY-SA 2.0
under a creative commons license
