How to Improve Your Home’s Efficiency – and Save on Your Utility Bills

We hear and talk a lot about changing habits to save money. It’s true that how we behave day-to-day can affect our finances. But, we can also improve the efficiency of our living space to save money on utility bills without having to change our habits.

A more energy-efficient home is good for the planet, and can also be good for you wallet. We’ve done the research to offer up a few suggestions on how to improve your home’s efficiency and save a little money along the way.

Have an Energy Audit

Bringing in a professional to conduct an energy audit is probably the most precise way to estimate potential energy savings for any home improvement project. There are associated costs with having a professional come into your home for an audit, but the personalized assessment might pay off. You can read more about how professional energy audits work at ENERGY.GOV.

If you’re not interested in having a professional energy audit, the Home Energy Saver calculator is a good DIY alternative. This tool can help you assess where your home might benefit most from energy upgrades so that you have some ideas to get started with.

While the recommendations will vary for each individual home, there are a few common home improvement projects that tend to reap the greatest savings on utility bills. Read on to get an idea of what you can expect to save with each project.

Seal and Insulate Your Home

Getting your home properly insulated is one of the most crucial steps towards improving the efficiency of your heating and cooling systems. Heating and cooling your home accounts for the largest portion (54%) of most utility bills. So any improvement in efficiency here may lead to major savings!

The goal is to make sure there are no air leaks that affect the efficiency of your heating and cooling system. Heat loss primarily occurs through the roof or attic (25%), windows or doors (25%) or the walls (35%). Small air leaks can occur where windows, doors, and the walls were not properly sealed. Applying weather stripping or caulking to seal off these small air leaks is good, cost-efficient fix.

If you find major heat loss in your home, you may want to explore installing proper insulation in the attic, walls, or even the floors. You can learn more about how to get started with improving your home’s insulation here.

In the average home, improved insulation can reduce the cost of heating and cooling by as much as 40% and new insulation can pay for itself in five to six years.

Upgrade Your Major Appliances

Taking stock of your large appliances – heating and air conditioning systems, water heaters, refrigerators, dishwashers, etc.  – is another good place to start. Swapping out even one appliance for a more efficient model could lower your monthly expenses, even if you don’t change your habits.

Consider investing in a programmable thermostat. According to Consumer Reports, installing one of these can save you around $180 on heating and cooling costs each year. They’re intuitive to use and are a great choice to further the efficiency of a well-insulated home.

How old is your water heater? Because most water heaters are constantly creating heat, they are one of the more costly appliances to run. Tankless water heaters are touted to be the most efficient option. And while that may translate to savings, you may not see the payoff from a tankless water heater until after 20 to 40 years. has an excellent energy and cost calculator that you can use to determine which water heater will be most cost-efficient for you needs while keeping current energy costs in mind.

Make Small Adjustments for Big Savings

Making the switch to compact fluorescent lightbulbs (if you haven’t already) is pretty easy – and it can pay off! The average American household has around 50 lightbulbs, and each compact fluorescent bulb can save around $6 annually. That’s a potential $300 in savings each year! And at this rate, each light bulb pays for itself in about one year.

If you’re ready to swap out any water-related fixtures, consider a low-flow option. Low-flow shower heads can save $40-$50 per year, depending on what kind of water heater you use. And low-flow faucets are also an option to consider.

Toilets are one of the biggest water drains in the American household, and are responsible for around 30% of all water use in the home. This may not be a major concern, because most new toilets are already low-flow, but it may be good to keep in mind if it’s time to shop for a replacement.

If you already have an efficient, low-flow toilet but you hear the toilet water running well after time of use, you probably have a leaky toilet flapper!  A solid toilet flapper can save you around $120 per year and is a small investment of about $10 upfront.

What other home improvements have you used to lower your utility bill? We love to learn from the experiences of our community. Let us know what advice you have in the comments below!


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