How to lower your electric bill: 16 tips to save you money

As the cost of living continues to rise, many Americans are looking for ways to save a little extra cash. One way to do that is to look for opportunities to reduce your monthly bills.

From TV streaming services to house utilities, the list of monthly payments most people have each month often provides opportunities for savings. One important bill to consider is your electric bill. While you might not want to completely shut off your electricity to save cash, there are some ways you can lower that power bill. Here, we will show you some easy tips on how to lower your electric bill and enjoy some monthly savings.

How to lower your electricity bill

From refrigerators to TVs, some appliances and devices are plugged in and running all the time, but there are plenty of ways to reduce energy use and save big on your electric bill.

1. Conduct an energy audit

If you’re not sure what runs your electric bill up the most, you should consider completing a full energy audit on your home. In doing so, you can find out which devices and or rooms might be making your monthly bill unnecessarily high. To run an energy audit, start by collecting and analyzing energy consumption data, including utility bills and equipment specifications. Next, inspect your home for energy inefficiencies, such as air leaks, insulation gaps and outdated equipment.

After collecting and reviewing the necessary information, develop an action plan that includes energy saving recommendations, cost estimates and a timeline for implementation. Regularly monitoring and evaluating energy consumption can help you reduce your energy bill over time.

2. Check insulation

Make sure all the doors and windows throughout your home are properly sealed. Leaks can let hot and cool air out of your home, making your furnace and air conditioner work overtime. As you might expect, this can affect your energy costs. Replace your weatherstripping or caulk around entryways to make sure there are less drafts. Also consider making your windows more energy efficient with these tips.

3. Lower the water temperature

You might be surprised at the savings you will enjoy from lowering your water heater’s temperature, as it accounts for around 20% of your home’s total energy usage. Hot water is likely a staple in your daily life as you shower, run the dishwasher and perform other household tasks. By simply lowering the temperature setting on your water heater to improve your energy-saving efforts, you can save big on your electricity bill.

4. Buy LED lights

Start by reviewing the various types of lighting throughout your home. LED lights use less energy than incandescent bulbs, so switching can help reduce your utility bills. To be more specific, LED bulbs are 80% more efficient than incandescent bulbs. For the best results, look for the Energy Star label (more on this later) on all of your bulbs.

5. Unplug unnecessary devices

Unplugging unnecessary devices is a simple yet effective way to reduce your electricity bill. Many devices continue to draw power even when they are turned off or in standby mode, known as "standby power" or "vampire power." This continuous power consumption can add up over time and significantly contribute to your energy costs. Using a more advanced power strip or simply unplugging devices when they are not in use, can eliminate this vampire power consumption and save money on your electricity bill.

6. Turn on the ceiling fans

Consider turning your thermostat down and switching on your ceiling fan at night to save energy. This may sound like a small feat, but HVAC systems use about 3,500 watts of energy per day, whereas ceiling fans only use about 30 – 50 watts.

7. Upgrade to energy-efficient appliances

You should also consider looking into replacing home appliances with more energy-efficient models. Before making the purchase, look at the unit’s Energy Star rating. This label and rating ensure that products meet energy-efficiency requirements set by the U.S. Environmental Protection Agency (EPA). An Energy Star rating of 75 or better is what you should look for.

8. Change filters regularly

It’s important to change your HVAC and furnace filters frequently, as clean filters use less energy. When air filters become clogged with dust, dirt and other debris, they restrict the airflow, forcing the HVAC system to work harder. This increased workload consumes more energy, resulting in higher energy bills. By regularly replacing air filters, you ensure that the HVAC system operates at its optimal level, promoting airflow, reducing energy consumption and ultimately conserving energy.

9. Adjust the fridge and freezer

You might not have to keep your refrigerator and freezer as cold as you think you do. Refrigerators should maintain a temperature of around 38 degrees to operate at peak efficiency. The temperature in your freezer should be set to 0 degrees.

If you’re keeping the temperature lower than this, you’re using more energy than necessary and costing yourself more money. That’s because your appliances must work much harder to maintain these low temperatures. Make sure you regularly check the thermostat in your fridge and freezer to ensure they’re at the correct temperatures.

10. Go solar

Saving electricity is great, but naturally creating your own electricity is even better. One way to do this is to install solar panels. Outdoor solar panels absorb solar energy during the day and the power stored can be used as needed.

The only downside is that it can be pricey to install solar panels, but you will get to take advantage of the federal solar tax credit. This tax credit lets you deduct 26% of the cost of installation from your federal taxes. Explore getting a cash-out refinance to fund your solar project if solar panels seem like they might be cost-prohibitive.

11. Buy a programmable thermostat

One of the easiest ways to save money on your electric bill is by using a programmable thermostat that will automatically lower the temperature in your home at night and lower your usage during peak times.

A programmable thermostat can turn down the temperature while you’re at work or when you’re out of town, which you may forget to do on your own. Instead of doing the heavy lifting on your own, consider investing in one of these handy devices to keep your home at an optimal temperature and save energy. Some electric companies provide free programmable thermostats, so be sure to check with your provider and see if this is something they offer.

12. Search for discounts

Searching for energy bill discounts is a smart way to reduce your electric bill. To find these discounts, you can start by contacting your energy provider or checking their website for any available promotions or incentives. Additionally, you can explore government programs or local initiatives that offer energy bill assistance or Residential Energy Credit.

The bottom line

There are plenty of steps you can take to lower your electric bill. You can start with the small things, like being sure to unplug unnecessary devices, cleaning HVAC filters and air ducts and adjusting refrigerator temperature. When you’re ready, you can invest in a more energy-efficient home by purchasing solar panels, Energy Star-rated appliances and new insulation. While a few of these options can be pricey upfront, you’ll save big down the line.

If you’re ready to upgrade your home but you’re not sure how you can finance it, apply for a cash-out refinance today. Instead of getting a personal loan, a cash-out refinance allows you to tap into the equity you already have in your home to access funds needed for any repairs and upgrades.