Video answer · Seal Tech Insulation
For most Michigan basements: seal and insulate the rim joists, then insulate the foundation walls.
The short answer
For most Michigan basements: seal and insulate the rim joists, then insulate the foundation walls. Closed-cell spray foam is well suited to both because it air seals, adds high R-value, and resists moisture.
The rim joist is usually the leakiest part of a basement. Sealing it with closed-cell foam stops cold air at the perimeter, which also warms the floor above. See why your first floor is cold for more.
Concrete and block walls feel cold and can carry moisture. Closed-cell spray foam applied directly to the walls adds insulation and acts as a vapor retarder at the proper thickness. It does not trap moisture against the wall the way fiberglass batts with a plastic vapor barrier can.
If you plan to frame and drywall, insulate before the walls go up. Spray foam behind the framing gives you a warm, dry finished space. Most basements must meet code for fire protection over foam, which your contractor and drywall plan should account for.
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