If you're considering replacing your home's windows, make sure it's money well-spent by following these steps. By Patricia Mertz Esswein, Contributing Writer Updated October 2013 If your windows on the world no longer enhance the facade of your house, shield it from the elements or filter out noise, it may be time to replace them with new ones that will complement your home's architecture, reduce your energy bills, increase your comfort, and promote peace and quiet. Replacing windows is an expensive proposition that includes not just the price of the windows but the cost of expert installation to ensure that the windows perform as promised. It pays to shop for both, especially now that retailers and remodelers in many parts of the country experience increased demand for replacement windows as local economies and housing markets recover from the Recession.See Also: SLIDE SHOW: Small Remodeling Budgets, Big Upgrades Through the end of 2013 you can defray a bit of the cost with the federal tax credit for installing energy-efficient windows in your home. The credit is worth 10% of the cost, up to $200 (excluding installation) and applies to replacement windows or new ones installed in an addition. (In October 2013, it was unclear whether Congress would extend the credit for 2014.) Sponsored Content Repair or Replace? Replacements come in two flavors. If the original framing is sound and reasonably square, you can install a replacement window into the original opening, replacing the sashes, side jambs and trim. If the original frame is rotted or significantly out of square, a new-construction window must be installed, which can cost 50% to 100% more than a replacement window, according to CostHelper.com. Replacing multiple windows will cost you less per window than installing just one or two. Tom Patterson, owner of The Window Man stores in Virginia, says that the number-one question he asks customers is "How old is your home?" Until the early 1970s, windows were generally well made with old-growth woods (the tight grains resist moisture and decay). Newer homes, says Patterson, may have poorly constructed, builder-grade windows that are already failing because their wood frames are susceptible to moisture. "I've put my finger right through the sills of ten-year-old windows," says Patterson -- a sure sign of rot. You can test your sills yourself by trying to poke a screwdriver into them. Or ask a window installer, home inspector or contractor to take a look. Advertisement If you have old windows you love and the frames are sound, you may be able to repair them, strip off the old paint and repaint or stain them, and add new storm windows with low-emittance (low-E) coatings, which reduce the heating and fading effects of the sun. Patterson says low-E storm windows run $200 to $500, depending on size and options, such as higher-performance laminated glass, which may go to $700. He generally charges $40 to $200 per window to install them. Windows painted shut long ago will open and you'll preserve the architectural or historical character of your home -- which some neighborhoods may require anyway. Calculate Your Payback You'll recoup much of your investment when you sell your home. In the latest "Cost vs. Value Report" by Remodeling magazine, the payback (when a home is resold) on four window-replacement projects (midrange or upscale, wood or vinyl) was at least two-thirds of the job cost. Midrange wood windows did best, returning 73.3% with a national average job cost of $10,708 (for 10, 3-by-5-foot, double-hung insulated wood replacement windows, exterior clad in vinyl or aluminum with exterior trim to match existing trim). Be sure to match the style and quality of the new windows to your house -- high-end in a luxury home, midrange in an average home, says John Bredemeyer, an appraiser in Omaha. The value of high-end windows in a tract house won't necessarily be reflected in the home's appraised market value. Prospective buyers may love those gorgeous, high-performance windows, but they may not be willing to pay more for the house to get them, especially among today's value-conscious home buyers. Your monthly energy bill should show immediate savings. Before you install new windows, however, you may want to seal up a leaky house and insulate it. It could cost several thousand dollars, but it may be more cost-effective. To evaluate your options, a home-energy audit, which costs $500 to $700 (or more for a larger home or in a pricier area), according to HomeAdvisor.com, is a smart idea. Advertisement Choose the Right Window Before you begin to shop, you need to learn the lingo: Double-hung windows may be opened from the top and bottom. Casements open with a crank, which makes them easy to operate. They are especially handy in hard-to-reach places, such as over the kitchen sink. Double-pane windows are two pieces of glass that may have an inert gas (such as argon or krypton) between them that insulates better than air. Mullions, or vertical and horizontal dividers, give windows a traditional look; snap-out mullions (also known as simulated divided lite, or SDL) make cleaning easier. Advertisement Tilt-out windows let you clean the exterior from the inside. Windows ordered off-the-shelf in standard sizes cost less than custom sizes with upgrades -- such as non-standard frame colors, hardware finishes and glass types; "between the glass" blinds or shades; and premium screens. High-performance and specialized glass (triple-paned for extremely hot or cold climates, or impact-resistant for wind- or hurricane-prone regions) add to the cost of a window. But the added cost may be worth it. For example, triple-paned glass could save on cooling a room that is often overheated by direct sunlight. The Web sites of well-known manufacturers, such as Andersen, Marvin and Pella, include guides that will lead you through the decision-making process. Check out Andersen's Home Style Library to identify the architectural style of your home and window styles and options that are appropriate to it.) Another great resource is the Web site of the Efficient Windows Collaborative, which is committed to promoting energy efficiency and sustainable building design. A brand name isn't everything. Window dealers may sell a single manufacturer's products or several companies' products, including those you may never have heard of or seen advertised in home magazines. As long as the seller can provide specs showing that the product offers the quality and performance you want at a price you can afford, you needn't fear the unknown. Advertisement Many manufacturers produce lines of windows that sell in various price ranges. If you can't afford the A line, you might get much of what you want with a B+ window, says Kerry McDaniel, with Galaxy Exteriors in Los Angeles. He says that big-box stores, such as Home Depot and Lowe's, tend to sell the B and C lines in order to stay at the prices they want to offer. Because Lowe's sells some Pella windows, and Home Depot sells some Andersen and Jeld-Wen windows, you could try asking local dealers to match the big-box store prices. If possible, visit the showroom to see and test models that interest you. Do the windows look as attractive up close as they do online or in the catalog? If the window tilts out, open it to see whether, given its weight, cleaning it is a job for one person or two. Select a Dealer There will always be home-improvement "tin men" who knock on your door and take you hostage in your own living room until you sign a contract -- not to mention the telemarketers, the lead-generating Web sites and the guy operating out of his pickup truck. Don't go there. You want a well-established company with a storefront and a Web site with helpful information. A dealer who will come free of charge to your home to assess your needs is even more desirable. Check the dealer's rating and record of resolved complaints with the Better Business Bureau or your county or state office of consumer protection. And post a query about the company's reputation on a local listserv or on Angie's List. Then obtain several bids. If one company can't provide exactly the same window as another, ask for the most closely comparable product it sells. Installation, including anchoring, insulating and sealing the window to the house to make it airtight and watertight, is as important as the quality of the window itself. A poorly installed window may be hard to open and close, and its durability, energy efficiency and appearance will be compromised. "You can buy the best window in the world, but if it isn't put in correctly, you're throwing away your money," says Susan Selman, with Schmidt Windows, in suburban Chicago.