For many homeowners, the energy bill is one of the largest daily expenditures. The problem is that it costs a lot of money to heat a house in the winter and cool it in the summer.

The funny thing is that people spend so much time considering the cost of heating and cooling that they overlook one of the other big elements of their energy expenditure, the hot water system.

It’s estimated that as much as 25% of your energy bill is directly attributed to hot water. That fact alone makes a good case for why you need to know how to save money and energy heating your water.

Most water heaters arrive at your home with the thermostat preset to 140°F. In most cases, this is where the thermostat sits as people don’t think about changing it. However, if you turn it down to 120°F it's highly likely that you won’t notice any difference when washing up or showering.

But, you will be surprised by the energy and cost-saving it makes.

A new hot water tank comes with insulation to reduce heat loss from the water. However, just because it has insulation doesn’t mean you can’t add more. 

Make sure you check the manufacturer's recommendations to ensure you don’t cover areas that should be left exposed. Once you’ve checked that wrap your hot water heater in as much insulation as you like. It will help it to retain heat and lower your energy bill.

This is an obvious step but one that many people overlook. Before you turn on your faucet consider what you are using the water for and whether it really needs to be hot water. 

In many situations, cold water will do the job just as well. For example, your washing machine can do most of its work with cold water, you can wash hands in cold water, and certainly brush your teeth in cold water!

The more cold water you use the less you’ll use the hot water and the greater the energy saving.

It should go without saying that leaks are bad for your finances. Leaking pipes cost you money in water usage and can even drain water from your hot water system. This means a constant flow of cold water into a hot water system. That results in more heating being needed and a greater use of energy.

Repair all leaks as soon as you find them to avoid this issue.

Traditional water heaters remain popular but they are often left on all the time. The belief is that keeping the water hot is cheaper than switching it on and off to reheat periodically. However, if you’ve insulated the tank properly then your water will stay hot for an extended period of time, without the need to use energy heating it.

In other words, put your water heater on a timer and save energy by only having it on when you’re going to use it.