Insulation, Radiant and Vapor Barriers - R value of non insulated walls

I have a house that was built in 1955, and has no Insulation in the walls. There is a thick type of tar paper between the studs and siding.
We are considering new windows, and have been told that the lack of Insulation in the walls is not a problem, and that the "dead space" has a
R value of 11! Still R 11 is not great, but will I still see a 40% reduction in heat costs with new windows? What is the R value of my walls?

You will not save 40% with new windows, if you have no insulation in the walls. Your walls probably have a R value of 2. I would expect you to save less than 10% on your heating costs. If your trying to save on heating costs insulate the attic first, walls second and windows third. Your climate will determine the amount of insulation you'll want.

I agree with chris8796!!

Yeah, I also agree with Chris. The window guy(or girl) is trying to make a sale. Does s/he know that the walls aren't insulated? If he doesn't then he might change his/her prediction when s/he finds out.

http://www.ornl.gov/sci/roofs+walls/insulation/ins_01.html

I told the guy the walls where not insulated. He then tryed to tell me that the dead space (where there is no insulation) has a dead space R value of 11. Yea right. I'm having and energy audit down next week by my gas company. They will advise on what to do. The best part, I can get 7o% of
my money back from various rebates and promotions, after I Insulate.
Thanks to all that answered!

You are on the right track. Their main goal was to sell you windows !! Not saying you may not need new windows since 1955 windows probably aren't to energy efficent but there some other ways to save on energy costs. I would add more insulation to my attic first, since you can DIY and doesn't cost an arm and a leg.( be carefull of ele. wiring up there) A lot of your house's heating and cooing capabilities is lost there. BE SURE to blow in 'cellulose", it is the best stuff. You can get it at your local Big Box store and they will loan you their blower if you purchase enough bags. I put 7" of cellulose over the top of my fiberglass insulation and my July bill was $68. less than last years bill !! Insulation companies can also add insulation to your non insulated walls, check with them on the process. I'm not an energy expert but I did stay at a Holiday Inn last night! Good Luck!!

Thanks to all the responded! my Energy audit is tomorrow. 9/11. I will let you know what is recomended.