New Furnace Trumps New Shoes

by FrugalBabe on June 22, 2010

Last weekend a good friend stopped by to visit us.  And she had fantastic shoes.  I wanted some too!  I knew that they would be expensive, but I figured that I could fit them into the budget and after a few months we wouldn’t even remember spending the money.  But then I thought about the furnace upgrade we’re in the middle of doing, and about how we’re working so hard to pay off our mortgage and live debt-free here on our mini farm.  And then I thought about clutter.  That was actually what convinced me that I don’t need those shoes after all.  I’ve recently pared my shoe collection down to a total of 10 pairs, plus winter boots, hiking boots, and snowshoe boots.  That’s down from about 20 pairs that I had before I started purging stuff.  And what I really like – more than a great new pair of shoes – is a nice clean closet without a lot of stuff in it.  I already have two pairs of flip flops and a couple other summer style shoes… I don’t need any more.  All of my current shoes (except running shoes) should easily last for another few years.  And since I don’t want to add to my shoe collection, I really have no reason to be thinking about shoes at all.  There.  See?  I talked myself out of spending $90 and adding something I don’t need to my closet.  Feels good!

Now about that furnace…  That is our big expense of the summer.  Well, that and central air conditioning.  We decided that we wanted to have air conditioning installed after spending a good part of last summer melting.  Our number one criteria for a new system was energy efficiency.  But we soon found out that the efficiency of the air conditioning would be limited by the efficiency of our current furnace, as the two systems are linked together.  Our furnace is only 11 years old – definitely not ancient – but it’s 80% efficient, and has a single stage fan (basically, it’s always blowing at 100% capacity).  So 20% of the energy from the natural gas the furnace burns is venting to the outside, and the fan is drawing more electricity than really needed to keep the house comfortable.  Replacing the furnace with a new 95% efficient, two-stage model would increase the SEER rating on our air conditioner from 13.7 to 16 (thus qualifying it for the federal tax credit).  It would also mean that only 5% of our natural gas consumption would be wasted, as opposed to 20% with our existing furnace.  And the new furnace will use about one fifth of the electricity of the old one for the fan.  We found this website to be very helpful while we were working on our pros/cons list regarding the furnace upgrade.

In addition, there are a boatload of rebates available to help pay for the high-efficiency furnace.  We’ll have to fork over almost $4000 for the furnace and $3000 for the air conditioner, but we’ll end up getting nearly $3000 in rebates from our state, the federal government, our electricity company, our gas company, and from the furnace manufacturer.  We’ll put the old furnace on Craigs List so that someone with an older, less efficient furnace can upgrade theirs too.

Because we’re going to have to pay upfront for everything and then wait for the rebates to come in, we’ll have to skip paying extra on our mortgage in August, and basically not spend money on anything other than food for a couple months.  But we’re ok with that.  The new furnace will make our air conditioner much more efficient, and our heating will be more efficient in the winter too.  Once the rebates and tax credits show up, we’ll only have spent about a thousand dollars more to have the air conditioner and the new furnace than we would have spent to just get the air conditioner.  And if our calculations are correct, the amount we’ll save in natural gas and electricity usage will be about $250/year.  So in four years, the furnace will have paid for itself.  After that, it will start paying us back.

Anybody else made the decision to put in a new, higher efficiency furnace, even when your current furnace was still working just fine?  It wasn’t an easy decision for us, but that’s what we came up with.

Related posts:

  1. Furnace Blues
  • http://www.rayandbecky.com Becky

    I just have to say, I love my Merrells! I have the Siren tennis shoes, and I keep going back and buying the same exact shoe every year when my old pair wears out.
    That being said, I also have plenty of summer sandals plus my tennies, so I also don’t need the super-cute Merrells that you linked to :)

  • FrugalBabe

    Becky,
    I love mine too! I have a pair of Merrells that I bought in 2002, and I still wear them several times a week. They’re a bit on the dirty side now, so they pretty much just get worn when I’m out in the yard, but they are still in excellent condition after all these years. I know they make awesome shoes, and I will definitely consider them for a pair of cute sandals when my summer shoes finally die, but for now, I just don’t need them.

  • http://myhousefull.blogspot.com kriswithmany

    We just replaced our furnace/AC, but we did not get high efficiency. While we know it saves money in the long run, we are planning on being in this house for only 2 more years. And we wouldn’t get a rebate back, as it is a non-refundable tax rebate, and we don’t currently make enough money to owe any taxes. Just wanted to say that the energy star won’t necessarily be the best choice for everyone.

  • FrugalBabe

    Kriswithmany – Good point, although one of the other reasons we went with high efficiency is because we want to make sure we’re “voting with our dollars” and rewarding companies for making products that minimize our ecological footprint. Although we do plan to stay in this house forever, there are benefits of buying highly efficient appliances that go beyond the amount of money our own family will save in utility costs. That being said, price is also a concern, and each family has to decide for themselves what will fit into their budget and what won’t. The tax credit was a big motivator for us to go ahead with the upgrade, so it makes sense that if you wouldn’t get it, there’s a lot less incentive to pay the extra money. Hmmm. Maybe the government should have made that refundable tax credit?

  • http://nopinkhere.wordpress.com nopinkhere

    A couple of years ago we upgraded and went high efficiency. It was worth it only because of the rebates. Otherwise it would take too long to pay off with the utility savings. (The unit would reach then end of its warranty/lifespan before breaking even.) We have a combined unit because we live in central TX and use our heater only for a month or so in the winter. We also upgraded some other things and had an “energy audit” to get even more rebates. Our most recent upgrade: a tankless hot water heater.

  • Focus

    My fiance and I are looking at replacing our air conditioner and furnace. How did you find out about the rebates that you mentioned? Thanks!

  • FrugalBabe

    Nopinkhere – I agree about the rebates. We would have purchased the high efficiency a/c regardless, because we were buying one anyway. But even though we’re big fans of putting our money where our mouth is in terms of our ecological footprint, there’s no way we would have replaced a working, 11 year old furnace without the incentives from the rebates. We’re basically getting a $4000 furnace (including installation) for about $1100… and even that took us about a week to decide to do, and required a full pro/con list!

    Focus – The company that’s installing our a/c and furnace had all the information on the rebates. They were able to tell us exactly what rebates we’d qualify for, depending on what models we selected. They can also help us get all the right paperwork for all of it once we get everything installed.

  • http://ozarkscrescentmural.blogspot.com/ Victoria – Ozarks Crescent Mural/My Freelance Road Trip

    We just had to replace the furnace last month because it went out. We chose a 95% efficient one because it would lower the utility bills considerably and will add to the resale value of the home. Plus, it’s the right thing to do and there’s the rebate. It cost $3,550 total. The AC unit is newer, so it didn’t need to be replaced. Funny enough, the furnace was original to the house which was built in the 1950s, so that furnace went a good 50-60 years which says a lot about how things were made.

  • mags

    We had geothermal installed last year (takes care of heating and cooling). We absolutely love it! We did a ton of research before we decided and while it was more expensive than a traditional system we’re really happy we went geothermal. The rebates were about the same as yours. The system should last a minimum of 25 years. We live on the east coast and had propane heat – our heating bills in the winter were around $400 – $500 a month. Last winter was one of the coldest in years and we paid one propane bill (gas stove and fireplace) in Nov. that was $80.00 and our propane tank is still over 80% full. Our electric bill only went up around $90 a month. So, we’re pretty happy. Oh, and when crunching numbers before the system went in – we (conservatively) figured it would pay for itself in about 7 years…now it looks like it will be less than 5 years.

  • Meg

    This comment is not about the furnace/AC, but about talking yourself out of the shoes. I did the SAME THING yesterday. It wasnt with shoes though. It was for a KitchenAid mixer.

    The ladies here at work have had the ones they own for over 10 years. I was thinking last weekend how nice it would be to have one (as I was mixing my 3rd batch of homemade waffles for the week). So, I had it set in my mind that I would open a SmartyPig account and start contributing my “allowance” money in there to save up for a mixer.

    I was making up all of these reasons why I NEEDED one. I make homemade pizza dough once a week, I make 2-3 batches of waffles a week, I make 2 batches of either muffins or biscuits, and one batch of yellow cake or brownies. All of these are home made – no pre-packaged stuff here!

    I went home and told hubby all about my master plan. He then said, “it only takes you 2 minutes to mix everything together by hand, right?” I agreed. He then asked, “Why do you need the mixer? Is it hard on your hands when you mix the batter by hand?” I repled, “No.”

    He brought up a good point! It really doesnt take me long to mix everything together by hand! I wouldnt save any time, and really, it wouldnt be that much of a convenience to get the $225 mixer! AND it would take up space on the counter-top. Not to mention, cleanup.

    SO…hubby saved me $225 last night.

  • FrugalBabe

    Mags – Sounds awesome! It must feel great to have made such a difference in your heating bills. Our heating bill in the winter was never more than about $100/month, but even so, we’re super excited about getting a more efficient system.
    Meg – I have made the same decision about a mixer. I make our food from scratch too, but it never takes more than a couple minutes to mix things by hand. I have a VitaMix blender that I use about three times a day, and it gets to sit on my countertop. Even the food processor (which gets used several times a week) has a place in a cupboard, because I really like having clean counters. That has been my biggest incentive to not buy anything else for the kitchen. We are going to get a dehydrator so that we can start drying our garden harvest, but it’s going to live in the basement, in the pantry area we’re making.
    Nice job saving $225 :)

  • Gregorius

    Now my English isn’t going to be good enough.

    A furnace with 95% efficiency is no longer the best! There are ones with an efficiency of up to 104%. That sounds odd, but it uses the warmth in the condensation that would be blown through the chimney and turns it into new warmth to heat your house. (I live in Belgium, and they were already available 13 years ago, but then they were still very expensive.)

  • FrugalBabe

    Gregorius – I’d say your English is great! We knew that 95% efficient wasn’t as good as it gets, but we did have to balance cost with benefit. There were more efficient models to choose from (although only some of them work with our air conditioner), but above 95% the price started to climb pretty quickly. The federal tax credit has a maximum of $1500, so a more expensive unit would not have qualified for any more of a tax credit than what we’ll already get. We are stretching the budget to the max to put in what we’re getting, and just can’t afford to go with anything better. We’re happy with the improvement that this one will provide, although we’re already starting to budget for putting in a solar hot water system someday…

  • BigNan

    Meg’s comment about the KitchenAid mixer caught my eye. My husband and I raised four children, and all my life I have been a baker. When the children were young, we felt a KitchenAid was too big an expense, but I had decided that when the family was launched, I would treat myself. But I never quite got around to it. $225 seemed like a lot of money. Then one day my husband found an old but working Kitchenaid at Goodwill for $5. It didn’t have a bowl, but he altered a stainless steel bowl that we had to fit the mixer base. I used that machine quite a bit.

    Then things changed again. Most of my family members have stopped eating baked goods for various reasons. Now the mixer sits in a cupboard, and gets taken out very rarely.

    The point of all this is that if you can find a good thing second hand, and then end up not using it as much as you had planned, you don’t have as much money sunk in the item. Another reason for buying used when the opportunity arises.

  • FrugalBabe

    Big Nan,
    I agree. Most of the stuff I’ve been getting rid of lately was purchased used, so there wasn’t much money invested in it anyway. If we had spent $600 to buy a brand new dresser last summer, I’d probably be a lot more hesitant to get rid of it, even though we don’t need it anymore.
    Good score on the $5 KitchenAid, by the way :)

  • Meg

    Frugal Babe : I forgot I have a VitaMix! Oh my goodness. It sits in the cupboard. I paid good money for it to. I wanted to “get healthy” several years back.

    I have a ton of fruits and veggies in the garden. I should take the VitaMix out and start using it. How could I be so dense?!?

    Isnt it awful when you forget about something like that? A couple hundred dollars… completely forgotten about and hidden in a cabinet. Ugh.

  • FrugalBabe

    Meg – glad I reminded you! It isn’t worth my time to put the VitaMix in the cupboard, as it literally gets used at least three times a day around here. Especially now that our garden is starting to produce lots of stuff, the VitaMix is getting a workout!

  • Meg

    I was wrong.
    I dont have the vitamix. I have the Jack Lelanne (spelling?) juicer!

    I am looking into starting to eat raw exclusively, and I remembered the VitaMix.

    What model do you have? May I ask how much you paid for it and when? Was it new? I am looking into purchasing one, but $450 for the new one is a bit steep! I’m thinking about trying the raw food thing for several weeks to see if I stick with it, and then decide.

  • FrugalBabe

    Meg,
    Several years ago, we got one of those juicers at a thrift store, and we would use it to deal with leftover produce from our CSA box that would stack up in the fridge. But when we got the VitaMix two years ago, we stopped having any leftover produce. We go through TONS more veggies and fruit now, and I make several batches of green smoothie every day. I also use it to make raw dips and sauces, chia and avocado based puddings, “caramel” sauce for apples (just dates, cashews, cinnamon and a bit of vanilla bean – it’s amazing what the VitaMix can do). We donated the juicer not long after we got the blender. I know a lot of raw foodists use both, but we’re happy with smoothies, and I didn’t have room in my kitchen for both.
    We got our VitaMix at Costco, and I think it was just under $400. Expensive, for sure. But it’s an outstanding product, and I use it several times a day. Earlier this year, it started to leak around the bottom, and I called the company. They said it sounded like a bad seal, and immediately sent me a whole new blade assembly and a big wrench for changing the assembly (very quick fix, and it’s been working great every since). There’s a seven year warranty on the VitaMix, and I can vouch for their customer service if anything needs to be fixed during that time.
    The VitaMix is the only product we’ve bought to assist us in our raw food lifestyle (we’re about 50 – 60% raw most days). We’re going to be getting a dehydrator soon to help preserve our garden crop, and I know I will be using it for all sorts of raw recipes too :) But we don’t have any other gadgets or gizmos except the food processor that we already had long before we got into raw foods. Good luck with raw, and have fun with it!!

  • FrugalBabe

    Meg,
    I forgot to mention that we have the 5200 model.

  • Meg

    Wow! You got a GREAT deal!
    The NEW 5200′s are $449 at the MINIMUM.
    Reconditioned is $379 with the 7 year warranty.

    I looked on Craigslist for two cities nearby, and nothing is available.
    Ebay has several of the old ones (from the 80′s) for nearly as much as the refurbished 5200.

    I also remembered the Montel Williams had an infomercial on one that also can make hot soups. I took a look at that, and it is 1/2 the price of a VitaMix. I started to consider that one, as it sounded so much like the VitaMix; however, looking at reviews, people say they have problems with it (leaking, burnt out motors, electrical smells, etc.) within 6 months. The Montel Williams one has only a 60 day warranty.

    SO…it looks like I will be getting a VitaMix. Maybe not today, or even this month, but when I am able to save up enough money out of my “allowance money” to purchase it.

    Thank you for your help!

    ~M

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