Call Me Al

So the 80′s weren’t all bad…

Paul and Chevy.  And some guy – you could call him Al.  He’d be okay with it…

You can call a hydronic system all kinds of things.  Some may call it art, others an appliance.  Heck, you could even call it Al.

Or Betty.

But one thing you can’t call it is an investment.

That may run counter to the salesy mumbo-jumbo out there, but hear me out.

An investment usually involves putting money into a 401k, or buying a stock or bond.  Over time it’s expected, if the markets are kind, that the amount of money you’ve put in will grow into a larger amount of money. The money’s basically locked away, so it’s not easily accessible.  When the bond comes due or the stocks or 401k are cashed in, you have a nice chunk of dough to buy a car or vacation home, send your kids to college or live out your golden years.

An appliance doesn’t do any of that.

Let’s say you invest in a high efficiency boiler with a fancy-schmancy ECM circulator, all designed to save you big money.

Upgrading from an old, ready-to-die system to a new, reliable, efficient system is a very good thing to do, but is it, in the strictest sense, an investment?

I’ve seen spreadsheets and read articles stating that, when considering annual rate hikes, a new system can “save” thousands of dollars over a 10 or 20 year period when compared to a standard efficiency system.  Those estimates are usually spot-on accurate, but are ultimately meaningless.

It’s pretty simple: you were spending a certain amount of money to keep warm in the winter.

Now you’re spending less.

At the end of that 10 or 20 year period will you have a lump sum of cash to send your kid to college?  Will you be able to use that cash to live on during retirement?

Well, if you stick that $10, $30 or $50 a month you “save” into some sort of long-term interest-bearing account, then you may.

In reality, that money usually gets redirected into the family budget to pay for something else. The 10- to 20-year projection of how much money will be “saved” with the new system sure sounds great, but ultimately it’s money not spent on one thing that will be spent on another.

That’s not a bad thing.  It’s a very good thing.  It’s just not an “investment.”

As Wesley Snipes said in our last blog, you can put a cat in an oven, but that don’t make it a biscuit.

A heating system isn’t an investment, even if you call it one.

It’s a pig.

It eats fuel, and it poops heat.

Your goal should be to put the pig on a high-fiber, low-fat diet. Make it a lean, mean, heat-poopin’ machine that keeps the monthly cost of not freezing to death as low as possible.

Sure, there’s the investment in your home comfort, the investment in your peace of mind, or the investment in your home’s resale value.  Those are all legit and have value.

But when you talk about the new system as an investment that saves money, the conversation naturally leads to “how much will it save?”

Which leads to “What’s the return on investment?”

Which leads to “What’s my payback?”

Which leads to “How long before this thing pays for itself?”

Which we discussed last time.

Soon, all the other benefits of upgrading to a high-efficiency system take a back seat to a vague, nebulous financial proposition.

Efficiency is a great selling feature, but it’s just one selling feature.  It should be used in conjunction with other features, not instead of.

Graceland was one hell of an album in its day, with lots of great songs.  Focus on just the hits, and you miss gems like this one…

“That’s one way to lose these walking blues…”

 

 

 

 

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