A simple way to save money is to improve your home's energy efficiency rating. For example, Washington, DC homeowners can save up to 9 percent per year on water heating costs simply by installing a water heater jacket. Water heater jackets are easy to install. Here's how you do it : First, before you go shopping, check whether your water heater is a gas model, or an electric one. Then, write down your water heater model number. Most water heater jackets list compatible water heater models on their respective packaging. Look for jackets with a value of "R-8". Then, as you start your project, be sure to turn the water heater off. Water heater jackets are pre-cut to make installation simple. Remove the outer packaging and separate the jacket's pre-cut pieces. There will likely be a top, a body and belts. You'll want to have plenty of duct tape on hand, too. Next, shape the top of the water heater jacket to fit your appliance. Trim around the pipes which enter the water heater, then tape the areas closed. This will form a strong seal. Tape the top edges down to the side(s) of the water heater. Then, take the body of the water heater jacket and wrap it around your water heater's mid-section. Have the belts ready and secure them, taking care that the belts don't push the insulation down more than one-quarter of its thickness. Lastly, outline the access plate with a pencil on the insulation exterior, and use scissors or a knife to cut the insulation out. Tape the edges to avoid fraying and set the water heater to a temperate no higher than 130 degrees. Note that outfitting a gas water heaters with jackets can be more complicated than with electric water heaters because of construction. If your water heater is a gas model, consider hiring a professional to handle your installation.