Provided by RBC Wealth Management and Thomas J. Powers

As we celebrate Earth Day every year on April 22, you may be thinking about the environment and the role it plays in your belief system. Should you wish to address this important topic in your investment portfolio, there are a number of opportunities to consider.

For starters, it is useful to know that responsible investing strategies encompass several tactical approaches, including the Environmental, Social and Governance (ESG) method. To apply this approach, you actively select securities (either stocks or bonds) from issuers who demonstrate responsible environmental, social or governance practices.

But you can also apply your environmental values through an investment in one of your most important financial assets—your home.

Let the sun shine in

You can realize a financial return from many types of home improvements. However, in terms of total benefits, adding a renewable source of energy, such as solar panels, may be among the best.

The initial outlay can be costly – easily reaching $30,000 or more depending on your home and the system you select – but by installing solar panels you could gain at least four types of potential financial advantages, including:

  • Improved resale value: Your home’s value may increase when you add solar panels, depending on your location and the size of your solar installation.
  • Tax credit: When you install and own a solar panel system for your home, the federal government will provide you with a tax credit—a dollar-for-dollar reduction of any income taxes you owe. In 2019, this credit is worth 30% of your total system costs. Starting in 2020, the federal tax credit will gradually be reduced, until it ends in 2022. Some states also offer tax credits for solar installations.
  • Lower energy bills: Your electric bill may decrease considerably after you go solar, depending on your solar panel system’s energy production, your local utility rates and your household energy consumption.
  • Rebates: Your state, municipality or local utility company may provide you with a cash rebate, essentially rewarding you for the energy you’re producing in your solar system.

These financial advantages, combined with the fact that installing solar panels could help you reduce your overall carbon footprint, could make investing in solar energy a responsible money decision that helps you contribute to the difference you want to make in the world.


This article is provided by RBC Wealth Management on behalf of Thomas J. Powers, a Financial Advisor at RBC Wealth Management, and may not be exclusive to this publication.  The information included in this article is not intended to be used as the primary basis for making investment decisions. RBC Wealth Management does not endorse this organization or publication. Consult your investment professional for additional information and guidance.

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