(MONEY Magazine) – With more than a month to go before the official start of summer, last year's record-high temperatures may be nothing but a hazy memory. But once the mercury climbs and your only redress is an overtaxed room air conditioner or pitiful ceiling fan, you'll wish you had planned ahead. Indeed, if you intend to install or replace a home air-conditioning system, now is the perfect time to do so. In the spring, many manufacturers offer off-season rebates or other incentives, and contractors aren't backlogged with heavy summer demand. But before you shell out $2,000 to $5,000 for a new home-cooling system, read on. By carefully tailoring an air-conditioning (AC) system to your house and considering costs beyond the initial price tag, you can save some cold cash.

The blow by blow

For most homeowners, a split-system central air conditioner is the cooler of choice. As the diagram on page 194 illustrates, this system typically has two components: an outdoor box containing a compressor and condensing coil, which work together to cool the refrigerant, and an indoor unit housing the blower, which circulates the air past the cooling coils. If you have a forced-air heating system, your furnace's blower can do double duty.

For a system big enough to cool a 2,200-square-foot house, you'll pay an average of $2,500, including installation, according to the National Association of Home Builders. If your home does not have ductwork already--from a forced-air heating system, for example--your costs will rise by at least another $1,500, depending on the size of the house and the difficulty of the job. Major AC manufacturers, such as Trane, Carrier or Rheem, charge similar prices for comparable equipment, so your up-front costs will depend primarily on two factors: how much cooling capacity you need and how much energy efficiency you insist on.

To answer the capacity question, you'll need to rely on expert advice. Your contractor will calculate what size unit you need, based on, among other factors, your home's square footage, insulation and the number of windows and doors. For an average-size home in a moderate climate, you'll likely need a 2 1/2- to three-ton machine. If you have a southern exposure or little shade, expect to be told you need a bigger unit. Cooling capacity is expressed in either British thermal units (BTUs) per hour or tons (one ton equals 12,000 BTUs).

Pay to save

When it comes to efficiency, you call the shots. The key is the AC unit's seasonal energy efficiency ratio, or SEER, which tells you the amount of energy needed to provide a specific amount of cold air. The higher the SEER, the more efficient the unit. Right now, the federal government requires all new central air conditioners to have a SEER of 10.0 or more.

If you plan to stay put for several years, consider a more efficient system with a SEER of at least 12.0. While it will cost $700 to $1,000 more than a 10.0-SEER unit, it will also cut your electricity bills. For example, if you run your air conditioning for a typical 1,500 hours a year, opting for a three-ton 12.0-SEER model could save you $72 a year on your electricity bills, according to the Air Conditioning and Refrigeration Institute, a trade group for manufacturers. That means you'd recoup the additional cost in 10 years or so. If you run your AC more often or have high electricity rates, you could recoup the cost faster.

If you live in a hot climate, you may instead want to pony up 20% to 30% more for a combination heating and cooling system called a heat pump. Like central air conditioners, heat pumps keep your house cool by extracting warmth from the indoor air and expelling it outside. The savings come in winter, when the system can draw heat from outdoor air that's as cold as 32[degrees]F to warm the house. A heat pump uses 30% to 60% less energy than an electric furnace does.

If you already have air conditioning and want to upgrade to a more energy-efficient system, see if your local utility will help. Florida Power & Light, for example, offers customers with old AC systems a $76 rebate toward a new three-ton 11.0-SEER unit, or a $442 rebate for installing a 14.5-SEER unit. In Phoenix, when you replace your natural gas heat and AC system with a heat pump rated 10.0-SEER or higher, the SRP utility company will refund $30 per ton. (For seven ways to lower your monthly energy bills once your AC is up and running, see the box on page 196.)

Finally, keep careful records of what you spend to install a cooling system. When you sell your home, you can add that home improvement outlay to the cost of your house for the purposes of figuring your tax basis, which can cut any capital-gains taxes.

Sweat the small stuff

Today's central air conditioners are peddled with a host of extras--but only a few are worth the added cost. One increasingly popular frill is a built-in air cleaner that removes allergens or smoke from indoor air. For homeowners with serious allergies, these specialized filters can be a blessing. But they'll add up to $800 to your purchase cost and clean the air only when the AC is running.

For working families, it pays to shell out $150 or more for a programmable thermostat. By setting it so the temperature in your home goes up by just five degrees while you're away during the day, you can cut your cooling bills by 15% a month.

What about paying more for an air conditioner that uses the new, more ozone-friendly refrigerant known as R-410A, instead of R-22, which is used in nearly all residential air conditioners today? Currently, only a few manufacturers produce systems with this new chlorine-free refrigerant. Under federal law, all firms must phase in units that use the new refrigerant, but the deadline is more than a decade away. Should you be an early adapter? "Consumers should not feel any rush to do it now," advises Bob Keingstein, president of Air Conditioning Contractors of America (ACCA). If you find the idea of helping the environment compelling, you may pay a price: R-410A units from Carrier, for instance, are twice as expensive as the company's regular systems.

Picking a contractor

With so many variables, it's crucial to choose a contractor who will steer you toward the right equipment and charge a competitive rate. One way to find a reputable one is to call your local chapter of the ACCA for a list of contractors near you. For the local number, call the national office at 202-483-9370.

Look for a contractor who carries liability insurance (in case of injury to a worker or damage to your house) and who is certified by--and employs technicians who are certified by--either ACCA or North American Technical Excellence. If your state requires contractors to be licensed (as 32 states did at last count), call the state licensing board to verify that the license has not been revoked.

Then get free written estimates from two or three contractors. Besides showing products and prices, the estimates should list start and finish dates (which can vary from two days to several weeks, depending on the season), the efficiency ratings of the suggested equipment and any available warranties and manufacturer-sponsored rebates.

Room air conditioners

If you need to cool just a single space, such as a bedroom or a studio apartment, a room air conditioner will do the trick for $200 to $1,000, depending on the machine's efficiency and cooling capacity.

The biggest error consumers make is misjudging the number of BTUs per hour needed. Too large a cooling capacity for the space will make the unit cut on and off too frequently, hindering its efficiency. Too small a unit won't properly cool or dehumidify the room. As a rule of thumb, buy a unit with 20 BTUs per hour for every square foot of living space. That said, you may need more cooling capacity if you live in a particularly warm climate or, say, on the top floor of a high-rise apartment building.

As with a central air system, efficiency effects the price. New room units have at least an 8.0 EER (energy-efficiency ratio); the average is 9.08. In general, when comparing similarly priced models, pick the one with the higher EER, which you'll find on the easy-to-spot yellow Energy Guide label. Finally, souped-up models may boast remote controls or even a heating function for the winter. Save your pennies and opt for an easy-to-install, efficient model that works for the space you need to cool.