So. For those who are interested, here's a breakdown of the furnace situation.
Our furnace was 14 years old (installed in 1999). I expected to get 2-5 more years out of it (many furnaces last about twenty years) but we don't know the maintenance history of it, and we discovered that the electronic filter on it was basically not doing anything at all so it probably got worn out quicker because of that. Also, the particular make and model of this furnace was part of a class-action lawsuit a few years ago for a faulty part that failed too early, and is exactly what failed on ours, so I guess it was just time for it to go. Luckily, that lawsuit resulted in a nice credit for us.
We went with one of the fancier furnaces - one that can modulate the amount of power it uses to heat the house, so it's more efficient. This was about $200 more than the mid-grade model, but I expect that over the life of the furnace we will save at least that much on our gas bill. We also upgraded to a fancy filter (which increased the labor warranty by five years) and took care of a code violation by installing a condensate pump to transfer condensation from the furnace and air conditioner into the utility sink. The water had been draining into a drain below the washing machine, using a hose just lying across the basement floor - a tripping hazard, especially since it was across the walkway leading towards the fuse box. And lastly we had electricians move the thermostat from its stupid location in the guest room to a central location in the living room.
Since this is our first home and we haven't used any of our energy or tax credits, we got quite a bit of money off, although those come in the form of rebates and didn't save us from the out of pocket expenses. We were offered 0% interest financing for two years, but I asked for a discount for paying in full up front and got 3% off the bill.
Here's how it breaks down:
Furnace, wiring, sheet metal, programmable thermostat: $6,060
Moving thermostat: $100
Condensate hose & pump: $220
Fancy air filter: $310
Total cost installed: $6,690
3% cash discount: $200
December promotion from installation company: $400
Gas company rebate: $425
Installation company rebate: $500
Electric company rebate: $100
Furnace brand class-action lawsuit credit: $492
Federal tax credit: $200
Total discounts: $2,317
Final out of pocket cost: $4,373
Things I learned from this experience:
* Do research on appliances BEFORE they break down. I'm not going to spend time worrying over whether we got a good deal or whether we chose the right furnace because it's water under the bridge now. But I AM going to do some research on our other large appliances. Water heater, oven/stove, dishwasher, washing machine and dryer. I want to have an idea of what I want and how much it will cost well before I need to.
* Maintenance is really important. Changing the air filter is something that will be done every 9-12 months. The inspector who checked the installation advised us to wait out the warranty period and then purchase an annual service package from an HVAC company. Doing so should make our furnace last a full twenty years.
* Keep track of manuals, receipts, and warranty information along with maintenance records. We have a lot of this information from the families who owned the house before us, which was very helpful in getting us the credit for the faulty part.