Retirement Dollars --> Energy-Efficient Techno Purchases

I invest some of my discretionary income to invest in speculative hybrid battery stocks. Does that count?

 

Yes, but I will only INVEST,if it means I come out ahead in the end, financially.

AFAI concerned, the Prius will save me money. I'm happy to make any such INVESTMENTS that make or save me money.

Ecology IMO MUST follow economy. If that means governments must give tax breaks or pass eco laws or oil prices must go up, so be it.

 

Yeah, I'd earmark discretionary funds. Put them in a relatively liquid/safe investment while saving up for purchase whatever. I wouldn't want to use retirement funds because of the penalties. Just be patient and save up da monies in another way.

 

I guess every environmentalist has their limits as I would be hard pressed to tap into my retirement security to invest in environmental upgrades to my house. There would have to be a consideration that the purchase would save me money to the degree that my retirement money should realize in gains. If someone lives life with conservation in mind, that ratio becomes harder to realize.

 

We try to invest in environmentally responsible funds, both retirement and nonretirement. We live in an energy efficient home (Energy Efficiency Index = 1) and are in the process of building an energy positive home (produces more than it consumes) on the South Fork of the American River in the Sierra Nevada. We will have photovoltaics, Thermomax for hot water and radiant heat, a clerestory (natural light) and ICF walls. Whether it is investing, purchasing or living, you need to model what you teach.

 

Good planning is more than figuring out a Return on Investment. You can calculate that an electric car does not give the ROI desired and claim it is foolish to spend the extra money. A couple of years later you then find out that gas rationing prevents you from driving for any purpose other than core necessities, even though the ROI calculations still hold.

Back when I got the 2001 Prius, I was told that the ROI does not add up. That did not stop me from making the right decision. Now the stakes are getting much more serious. Don't place too much faith in ROI calculations.

(Hint-Account for Black Swans)

 

yikes... cashing a 401k is imo the very last ditch option. have you run numbers? is the gain going to recover your losses from the early withdrawal penalty and lost growth in your retirement funds?

depending on your age, i bet taking out a loan would cost you less in the long run.

 

your feeling is right- saving is going to be your best bet over 401k withdrawal!

consider your current monthly energy costs vs a hypothetical cost of monthly payment on upgrades. also consider how long they will last after you paid them off. i'm another long term thinker (and a hater of debt accrued for convenience sake), so i can see your dilemma.

re: taking a loan... put it this way... we could have depleted our retirement savings (meager) and applied it toward DH's college penalty-free. instead, we got subsidized loans that will incur low interest after he graduates. the interest cost to us will be low, but the cost of lost opportunity in the retirement account added up to A LOT by the time we would be looking to retire.

just throwing my thoughts out there.

 

Let's see... Would I spend my retirement money on eco-friendly stuff? Absolutely!

Also on food, doctors, gas, drugs (the legal kind) and just about anything else you can think of. Fact is, every penny I spend is from my retirement investments.

I guess that's because I'm retired...:bounce:

Seriously, I doubt that I would have taken money out that required I pay a penalty for doing so.

Bob

 

Investing in energy mutual funds or energy-related companies seems almost a no-brainer these days. If you bought oil company stock just a year or two ago, you're in good shape right now.

 

Your description shows your postion is carefully thought out. The best long term planning achieves both of your goals...and it looks like you are doing that.

 

I used a home equity loan for PV and tankless.

My parents are retired and are going to put in PV in July. When their current water heater goes, they'll be replacing it with a tankless.

 

About 3 years ago we got an estimate on installing a massive solar electric system on our roof in very sunny Palm Springs. I was ready to pop for half of the $65,000 cost from my retirement savings, feeling confident at the time that oil prices during an oil war with an oil war President would be going up.

My husband did the math, which he is really quite good at, and it looked like the payback time would likely be over 20 years. So we let it go.

Now there are some vastly cost reduced methods being developed for actually printing solar cells, and I suspect within a few more years there will be far more cost effective solar systems on the market. We may go for it then, because we have more sunny days here than most areas, and summer temperatures in the hundred-teens are typical. We use an enormous amount of electricity with our central air system. Today's forecast high is 119F (48.3C).

Since we last priced out a solar system I have retired. I did insist on getting a high SER central air system this past spring to replace our 20 year old, noisy, leaky freon-based system and I used some of my retirement savings for that.

It would be much easier to balance these equations if I knew when I was going to die, but few of us have that luxury or curse, whichever the case may be.

7 years ago we decided to buy our current house as a vacation/retirement home while we were still living in the Bay Area doing high tech jobs. At that time I pulled money from my 401K for the down payment. Soon we moved here and I telecommuted 500 miles for the last few years of my career in corporate land. Then we proceeded to aggressively pay down our mortgage, planning to pay off the debt in 5 years. We paid it off in under 4 years. Now I will have no more mortgage payments ever, and the money I took from my 401K to put on the house has resulted in reduced monthly expenses. This allowed me to retire earlier.

To answer the question in the OP more directly, it might make sense to raid your life savings if doing so will reduce your cost of living during retirement. And yes, I'm willing to do it.

 

What's the relative humidity there? You might be able to use an evaporative cooler at least part of the year instead of the AC. Evaporative coolers use considerably less energy than any AC and could save you scads of cash. But they're suited to dry climates, so if you get humidity too then you're SOL. I'm guessing it's pretty dry where you are so it might be something that could work for you.

BTW, why do you want to retire to somewhere that regularly hits 119F?

 

Does this mean: Would I invest in Stocks and Funds in a very diversified portfolio to include various energy companies??? YES, I have done so and am still doing so. Whether it is personal investment capital or 401K or IRA, these funds must be invested in a broad investment plan. Would I take 500K in my retirement plan and invest it in ONE company..................NEVER. I don't care if it is Energy or a long term CD in my local bank....anything can fail!