The last electric bill convinced me that i'm gonna have to make some changes around the house and computer is on the list since its on about 8 hours a day.
Its a 3 year old core2quad 2.6ghz on an asus board and a nividia gs7800 with 2 hard drives a dvd writer a fan and not much more. It has a 600w thermaltake PS and i'm thinking i can go to lower wattage PS to save some bucks but how low do you think i can go?
Lower wattage won't necessarily save money. Power supplies don't pull their full rated wattage at all times - they just pull however much is needed. Therefore, the relevant parameter is efficiency, not raw power. The best you could do for your electric bill would be to get the most efficient power supply possible.
On a related note, if your board supports it, changing from your current 65nm quad (at least I'm assuming it's 65nm) to a 45nm (such as a q9400 or 9550) would probably make a larger difference in power usage than a new power supply ever would. Even so, it's not the best way to save power - you would be best off following Shadow's advice, and replacing light bulbs and the like. Unless you do a fairly thorough system overhaul, you aren't going to drop your power usage very much on that system, and it probably won't be worth the money.
What is your current power supply btw (exact model)?