Keeping your water heater and water pipes insulated is a great way to reduce water and energy use.

By keeping those parts insulated, you'll lessen the need to run the water to get it to the ideal temperature.  And of course, this reduces energy use, too.

Water heater wraps or blankets are inexpensive and easy to install.  The supplies can cost as little as $10.00 and can take as little as 30 minutes to install.  Some sources estimate that insulating a water heater can save between 4%-9% in water heating costs each month.

30 minutes, $10 and as little as 1 month until payback?!?  That's a no-brainer.

While you're at it, why not add some insulation to your water pipes as well?  Once again, the materials are inexpensive and assuming the pipes are within reach, the installation is straightforward as well.

Insulating the hot water pipes will save on energy and water, and covering the cold water pipes will cut down on condensation and the risk of freezing and bursting in winter months.