In this video we calculate the return on investment in 4 steps:

  1. Planned Energy Cost with Inflation
  2. Planned Energy Usage Reduction Savings
  3. Home Upgrade Return on Resale Value
  4. Taking Action Rate of Return Tax Free

Confirm You Finished Watching The Video

Is it a good use of my money now?

The #3 holdback we hear is people concerned about the project being a good use of their money. They are concerned about the rate of return on their insulation project investment. This is reasonable. So let’s talk about it. 

Assumptions for Savings Worksheet

We have a four step process called My Savings Worksheet to help you put hard numbers on your annual rate of return.  

I’m going to walk you through this worksheet based on a guesstimate. But of course, if you want us to calculate all the numbers for you in a few minutes, just ask, and we will get you the answers. 

The first numbers we need are your: 

  • Current Annual Energy Cost
  • Planned Future Years In This Home
  • Investment Today

If your current Yearly Energy Cost is $2,400, and your Planned Future Years In This Home is 10, then your 

Planned Energy Cost is: $24,000.

Yearly Rise in Energy Costs

But wait! Have you heard of that annoying thing called inflation? Yes! According to the Bureau of Labor Statistics, the average energy cost rise from 2000 to 2008 was 3.19% per year.

Plus, the ForecastChart shows that the average energy cost rise from 1958 to 2018 was 4.33% per year.

What does this mean to you? Your Planned Energy Cost is not $24,000 because you have to account for price increases. Let’s calculate…

  • My Energy Cost Rise at: 3.5%
  • Panned Energy Cost With Rise is: $28,155

So your future total energy cost is not the $24,000 (10 years x $2,400 yearly bill), nope, when you account for energy cost rising at 3.5% per year, your future energy costs are $28,155. 

Energy Savings Calculations

This is a much bigger expense when you look at the big picture.

So according to the Energy Star website, the “EPA estimates that homeowners can save an average of 15% on heating and cooling costs (or an average of 11% in total energy costs) by air sealing their homes and adding insulation in attics.” 

Notice, the EPA did not say, adding insulation alone. That’s right, because insulation without proper air sealing is not very effective. But yet insulation alone is what nearly all insulation companies offer. 

Next, Energy Star states, “Leaky ducts can reduce heating and cooling efficiency by as much as 20 percent.” Sealing and insulating ducts increases efficiency, lowers your energy bills and can often pay for itself in energy savings.”

Why not just replace all the ducts? 

Well because you end up with the same R-6 that is currently sold by HVAC contractors. Is just as susceptible to leaking. Instead, we add rigid closed cell spray foam to double the R-value, and seal up any leaks. This is by far the strongest, most durable solution. 

So I point these three statements by Energy Star out to you to come to this point: Stellrr’s clients claim on average, 30% fuel and electricity savings per year. 

So to continue on with the Energy Savings Worksheet from the last email. Let’s say your… 

  • $2,400     Current Annual Energy Cost
  • 30%         Energy Usage Reduction
  • $720        1st Year Reduction
  • 10             Planned Future Years In Home
  • 3.5%       Annual Energy Cost Rise
  • $8,446    Planned Reduction

So when you calculate the savings over the time you plan to live in the home, it is a much bigger number than you may realize. 

Home Resale Value Increase

Now we are talking about what the property value increases look like for these upgrades to your home’s resale value.

According to Remodeler’s Magazine, different types of home upgrades will yield different returns on the investment. This is their Cost versus Value Report.

For example, if you spend $10,000 on a kitchen remodel, when you sell the house, you will only get $6,500 back. 

What the report says about Insulation? You get a 108% return on your investment. Just about the Only upgrade to your home that increases the value of the home more than it costs to do the upgrade.

There is more good news from The Appraisal Journal, Evidence and Rational Market Valuations for Home Energy Efficiency. According to this research study… 

the selling price for homes increased by $20.73 for ever $1 decrease in annual fuel bills!

So, back to our previous analysis. 

  • $2,400     Current Annual Energy Cost
  • 30%         Energy Usage Reduction
  • $720        1st Year Reduction
  • x $20.73    Increased Selling Price for Every $1 Decrease
  • $14,925     Property Value Increase by having the $10,000 project done. 

What does that mean? In this example, by investing $10,000 in the Stellrr project, that increases your energy savings, your house can now sell for $14,925 more than it would without the upgrades, according to previously mentioned studies. 

I wish the Stockmarket provided returns like this!

Annual Rate of Return Calculation

Take a look at the worksheet, on the bottom left you see… Taking Action Expense Savings example is: $23,372 that has Zero Income Tax on it, if you are int he 25% Income Tax Bracket. 

The Taking Action Return is $23,372 minus the $10,000 initial investment then divided by the 10 Panned Future Years in the Home. Which equals a Taking Action Annual Return of $1,337.

This equates to an annual rate of return of:

  • 13.37% Taking Action Annual Rate of Return, and
  • 17.83% Income Taxed Annual Rate of Return

So a 13% – 18% annual rate of return on the investment in your house sounds like a home run to me. 

Let’s run your numbers! We would be happy to come work through the My Savings Worksheet with the numbers from your specific project. Let’s see how much you could save, on top of simply creating a much more comfortable house. 

I look forward to helping you accomplish your goals. 

With gratitude,


Shawn Mansur, Founder & Author

P.S. If the numbers make sense, and you are ready to move ahead, you can approve your project here: