A guitar's sound can actually improve with age. One of the greatest threats to your older guitar's tone is ageing or damaged machine heads, the gears and cranks that adjust the tuning of your guitar's strings. Upgrading your guitar's machine heads can dramatically improve not only its ability to stay in tune, but the quality of its tone.
Loosen and remove all the strings from the guitar. Examine the headstock. Your guitar will have one of two basic types of guitar tuner/machine heads. Linked machine heads, usually three on a side (six on a side for a 12-string guitar) are found on many acoustic and classical guitars. These come out in one piece. Individual machine heads are removed individually for each string.
Remove any small screws or nuts which hold the machine heads to the headstock of the guitar. The headstock is the part of the neck above the frets and the nut. Once the fasteners are removed, gently lift the machine heads out of their positions. Notice which way the cranks and pegs were positioned so that you can return the new ones to their proper places.
Clean around the openings in the headstock with a soft cloth and furniture or guitar polish and cleaner. If there is any damage, chipping or wearing around the machine head openings, repair it. If you are uncomfortable with wood repair, take it to a guitar shop.
Seat the new machine heads in position. You may need to gently sand around the mounting holes if the new heads rub or bind. Once the heads sit snugly in their holes, screw them in place. If you have a single-peg design, tighten the nut on top that holds the assembly in place and screw the machine head's gear cover into the headstock.
Adjust the bridge on the body and the nut to make sure they are seated securely. Re-string the guitar. This is a good time to put on new strings.
Tune the guitar. Check to see that the machine gears are properly tightened and that the mechanism works smoothly but isn't too loose.
Wipe down the body with guitar cleaner and polish to remove fingerprints and oils left by your hands and skin when you handled the guitar.