Insulation
What is Insulation? The answer starts with the role insulation plays in your home. All insulating products are based on a single basic principle: heat moves from warmer to colder areas. On cold days, warm air from inside tries to get out. On warm days, the hot air outside is trying to get in. Insulation slows this process.

Which means the only way to maximize your home's energy efficiency is to insulate all the areas of your home susceptible to air infiltration and heat transfer.

Insulation wasn't standard for newly built houses until the mid-70s oil crisis. So if your home is older than that, check out your attic floor - it's the place you'd be most likely to find the stuff. None? Consider adding it to the attic and the basement. Even if there's some insulation there already, you may benefit from adding more.

Annual savings: About 5% on your fuel bills (if you have some insulation already) to 25% (if you have none).

Up-front cost: About $1,000 to insulate the attic and foundation yourself; about $2,000 to $4,000 for a handyman to do it.

The credit: 10% of the cost of materials (credit cannot exceed $500).