You can significantly increase your terminal productivity by setting up aliases, which are shortcuts that allow you to execute a command more efficiently. Commonly used commands like `git add -A` and `git commit -m`, as well as searching for strings within directories, can be easily customized with aliases. To make these aliases work, you need to create a bash profile in your home directory, which is then sourced when you run the alias command. You can also customize the terminal output by enabling color output and adding custom aliases, such as `ls | lolcat` or `ls -la | lolcat`, to display files with colored information. By using aliases, you can streamline your workflow and make your terminal more visually appealing.