Finance Travels

I’ve been toying with upgrading our hot water heater over the past year.  The one we had was 15 years old (well beyond its expected life) and I certainly didn’t want to wait for it to break before replacing it.

My first thought was to go with a tankless model.  Unfortunately, after doing a good bit of research and talking to numerous plumbers, I found that it just didn’t make economic sense yet.  ConsumerReports.org indicates that it takes at least 15 years of energy savings just to get your ROI, and the plumbers I talked to wouldn’t recommend them because of the temperature rise from well to faucet is too great in our area (it makes more sense for those in warmer climates).

So anyway, my dad came down this weekend and the fun began…

We wanted to replace our current gas hot water heater with newer, more efficient gas model – simple enough, right?  We visited both Lowes & Home Depot to do some comparison shopping.  Both places had similar models at about the same price.  The salesman, “Hoss”, at Home Depot was considerably more helpful, so we went with them.  We purchased a 12-year model, which was the most efficient that they had in stock.

We get home and unpack the water heater.  It wasn’t until this moment that we noticed that the old water heater had a little fan on top of the exhaust vent that was integrated into the water heater.  My dad had never seen this before and we were more than a bit confused by it.  We headed back to Home Depot to ask Hoss about it, who then informed us that we had a “Power Vented Hot Water Heater” and that the one we bought wouldn’t work.  We’d have to either special order one or go with electric.  Oh, and the Power vented models run about $400 more.

Without doing much more research, I decided to go with an electric hot water heater.  So dad and I headed home, packed up the gas water heater, returned it to Home Depot (who gave us absolutely no hassle about returning it), and picked up a 12-year electric water heater and the necessary equipment to wire it up.

Fortunately, my dad is very good with electric wiring and the breaker board is very close to the hot water heater’s location, so wiring it up was not difficult.  Hooking the pipes up to the new hot water heater went surprisingly well.  All that we had to do was drain the old one, add some length to the existing pipes using CPVC couplers, and put the pipes into the water heater.  All together, everything went very well once we had it all in place.

However, I’m now experiencing a bit of buyer’s remorse.  I’m thinking I should have been patient and waited to order the natural gas powered water heater with the power venting due to the fact that it is cheaper to operate than electric will be.  I’m hoping that since I replaced a 15-year old natural gas model with a new more efficient electric one, I’ve at least not increased my monthly hot water heating bill.  It will be interesting (and difficult) to compare the costs.

I’ll post the results as I learn them!

We’ve taken a number of steps this past month to reduce our energy costs:

• Purchased a new refrigerator.  Using my Kill-A-Watt, II ran a comparison test between our old refrigerator and our new one to determine just how much less electricity it is using.  Initial results show that the new one uses about 1/2 of the electricity than the old one.
• LED Bulbs. I purchased a 3-pack of chandelier bulbs from Sam’s Club the first week of January.  While expensive, at $15 for the 3-pack, I wanted to give them a try.  We found that they aren’t bright enough to replace all of the bulbs in our 6-light chandelier, so we replaced 3 of them and left the other 3 as normal incandescents.  Unfortunately, one of the LED bulbs died within 2 weeks and I had to send it back for a replacement.  The other two bulbs are still working, and saving (they say) 90% of the electricity used in incandescents.
• Hot Tub Modification – Probably the biggest factor in energy savings is that I set the hot tub to run at 80 degrees rather than the 96 degrees it had been set at.  We have found that we rarely use the hot tub in the winter, so setting it to 80 degrees wasn’t a big deal.  I is able to heat up to 100 degrees within 2 hours, so if we know we are going to use it, we just increase the temperature early in the morning and then turn it back down once we are done.  However, next year we will probably pay to have it winterized from November to April.

Results

While it is still too early to determine the real savings, the electricity bill that I received this month was 10% less than December 2008′s.  It’s also significant that the new refrigerator & hot tub modification was done within the past 2 weeks, and therefore the electric bill had at least 3 weeks without the hot tub modification or the new refrigerator.

Other Projects

This weekend I’ll be replacing our 14 year old hot water heater with a new one.  The energy rating on the new one is about 50% that of the old one, which should really make a difference in our natural gas bill.  We looked into a tankless system, but a number of reports show that the ROI takes well over 10 years, so we decided to go the traditional route and use the money saved to put towards our new car fund, which will go towards a much more effecient vehicle when we eventually make that decision.

Any other suggestions?

January proved to be another tyring time for our investments.  I really need to find an index to compare my stock performances with to determine just how bad/good I’m doing compared with the rest of the market.  However, given that over 50% of the net loss this month can be accounted to buying a new refrigerator, I’m not as disappointed with the month as I could have been.

One note on the new refrigerator:  some Kill-A-Watt research shows that the new refrigerator is more than 50% more efficient than the old one, meaning a few bucks shaved off of the monthly electric bill.  So I guess I’ve got that going for me

February should be a pretty decent month given that we should have our tax rebate coming in.  The next major household purchase will probably be a tankless hot water heater, as our hot water heater is already well beyond its expected life.  I’ll be posting more on that as it happens (which may or may not be in February, depending upon just how busy local plumbers are).

Also noteworthy for the upcoming month is that my 0% interest deal is close to expiring on the credit card that I used to pay for a majority of the hot tub in March 2008. I’ll be paying off that account in full as well as canceling that card.  Only 2 more months away from having both vehicles paid off as well!

Note:  I was able to wait until March, 2009 to make the credit card payment, so I left the balance in an interest-bearing account until the second week of March.

January 2009 Net Worth