1) Install a Programmable Thermostat – I installed a digital programmable thermostat about 3 years ago now and I’ve been reaping the benefits ever since. At night in the winter, I let the temperature drop down to 62 because I don’t need my house to be warm when I’m sleeping. They can be programmed to do the same when you’re at work during the day and the savings can be pretty dramatic.

2) Upgrade your old appliances. How much are those old appliances costing you? It could be a pretty penny. My grandparents recently replaced their 40 year old refrigerator – saved them $60 a month! Old appliances suck up electricity like crazy – newer models are far more efficient.

3) Replace your light bulbs – Incandescent light bulbs may be cheap but they’re also extremely inefficient. If you’ve ever touched a light bulb that’s on, you know they’ll burn your skin (please don’t try this at home). A significant portion of the energy that goes to making light turn on is turned into heat. Now try touching a flourescent bulb – this one is okay to try at home – it will likely be warm to the touch but it won’t burn. I recommend replacing all your lights with flourescent bulbs – they last up to 10 times longer and can save you a bundle. If you really want maximum efficiency – you can turn to LED lights – they’ll remain cool to the touch when running and last for about 100,000 hours (11 years of continuous use). They’re expensive initially but you may never need to replace the bulb.

4) Install ceiling fans – a great way to keep your home comfortable in the summer without making your air conditioner work overtime is to install ceiling fans. The key to saving money with ceiling fans is to remember that ceiling fans cool people, not buildings. Turn them off when you’re not in the room. If you have high, vaulted ceilings, they can also be useful in the winter for pushing the hot air back down to where you want it – set it on low for this task.

5) On demand hot water heaters – Here’s another really cool appliance most people don’t know exist. You don’t need to have a water heater with a big tank to provide you with enough hot water to take your shower. In fact, new water heaters can heat up the water without storing it at all. They’ll heat it up instantly and only when you need it. Just think about how much energy is wasted keeping hot water hot for when you need it and I think you’ll see pretty quickly how this can save you a ton of money every year.