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(Money Magazine) -- To hear window salesmen tell it, replacing old single-pane windows with modern double-pane ones will cut your heating and cooling bills in half. Don't believe the hype.
True, today's best windows are twice as energy-efficient as those installed just a decade ago, but because windows make up only a fraction of your home's exterior, your actual energy savings will be no more than 25%, and maybe just 5% or 10%.

(Money Magazine) -- To hear window salesmen tell it, replacing old single-pane windows with modern double-pane ones will cut your heating and cooling bills in half. Don't believe the hype.

True, today's best windows are twice as energy-efficient as those installed just a decade ago, but because windows make up only a fraction of your home's exterior, your actual energy savings will be no more than 25%, and maybe just 5% or 10%. Considering that replacements run $300 to $1,200 a window, we'll all be using hydrogen power before your new windows pay for themselves.

Still, there are other reasons to replace windows: New ones open and close easily. They tilt in so you can clean from indoors without climbing a ladder. They don't rattle when trucks drive past or ever need exterior painting. And they can even increase your property value if you do the job right.

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Preserve your home's character

You can't count on recouping the full cost of new windows when you sell - a 2007 National Association of Realtors study found that sellers got back about 80% of the expense.

But choose the wrong ones and you can shatter your house's salability. "Like mantelpieces and built-in cabinets, original wood windows are important architectural features," says Atlanta realtor Bill Golden. "Replace them with a downscale product and you downscale the house."

Avoiding this trap is simple: Buy windows that mimic the ones you're tearing out. Although vinyl windows ($300 to $800 installed) are the least expensive option, they have a plain-Jane look that's fine on a simple tract house but not on a classic prewar. Wood replacements ($400 to $1,000) need periodic painting.

So you're best off with a clad window ($500 to $1,200), which is made from wood with a pre-colored, no-paint-needed aluminum coating outside and a wood finish on the inside, giving you classic beauty that's also low maintenance.

The same goes for window style: If your old ones have "divided lights" - that is, multiple pieces of glass separated by dividers - your house will look best if the new windows display the same pattern.

Trouble is, true divided lights are available only on custom windows ($2,000 and up); the standard solution of snap-in grilles (a $25- to $50-a-window add-on) looks the part only from the inside.

For a well-dressed house, get simulated divided lights (a $200-a-window add-on), which have permanent grilles on the inside, outside and between the panes - and can pass for the real thing.

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Think green

While it's not worth buying new windows solely for the energy savings, you should go for efficient ones if you're replacing them anyway.

In most of the country, says Dariush Arasteh, a staff scientist at the Lawrence Berkeley National Laboratory, you should spend an extra $10 to $20 each for windows that have argon gas between the panes and a low-e (low-emissivity) coating, an invisible film that blocks heat from going through the glass.

That can knock 8% to 15% off your heating and cooling bills, according to Nils Petermann, a senior associate at the Efficient Windows Collaborative in Washington, D.C. To see what's best for your climate, visit efficientwindows.org.

For installation, consider the trade-offs

A true window replacement involves removing the interior and exterior trim, attaching a new window to the house's framing, insulating and sealing the gaps and then reinstalling the trim.

That's a labor-intensive job that most installers skip by simply removing the sash (the framed glass sections) and popping in a window insert. This will save you $150 to $300 a window in labor. But because it's those uninsulated spaces around the old windows where much of the air escapes, inserts may not eliminate drafts - or yield any energy savings.

Also, the glass will likely be about an inch smaller - in height and width - and inserts can look decidedly like a retrofit, says Harleysville, Pa. contractor Dennis Gehman.

To decide what's right for you, get a wide range of bids. A good contractor will happily explain how he'll do the job, what the result will look like and how much it will cost. For inserts, major window manufacturers and home centers offer installation, or you can do it yourself and save another $100-plus per window. (The trickiest part is the measurements.) For a full-scale replacement, you'll need a general contractor.

Also, get two warranties: one from the manufacturer and another from the contractor. Some warranties are transferable to the next owner, providing you with one more selling point - in addition to your sparkling clean, easy-to-open, energy-efficient windows.

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