I just installed a new water heater about 5 weeks ago and left it at the factory setting.
About a week ago I started to do a couple of tests, learned from a few plumber friends I know, and sure enough they were right on. (One was even mentioned in the installation instruction manual that Whirlpool provided with the heater.)
Turn on the hot water and as it starts to heat up and before it gets too hot to hold your hands under, cup both hands together and fill them with hot water. Then smell the water in your hands. If it has an oder, then it isn't hot enough. This is what is called "stinky water" and is caused by the temperature not being set high enough. There is bacteria and other little bad critters that can still live in the water, if the temp. is to low. Most factory setting are not set high enough.
Tried it the other day and sure enough I could smell a bad oder. Changed the heat setting and waited a couple of days and the oder was gone.
I did this test on the water heater I replaceed, when I moved into this house and there was no oder. Checked out the temp. setting and it had been set higher by the last owner.
The next test is to go to the area that is furtherest from the water heater and turn on just the hot water. Now check the amount of time it takes for the hot water to reach that area before it gets to the full set temperature. Now take that time and multiply it by the number of times you use that outlet each day and you'll get a rough figure as to the amount of gallons of water that is wasted each time you use that outlet. Now if you really want to get an idea of how much water is being wasted, do this at each hot water outlet you have in your house and you'll start to see about how many gallons of water go down the drain, waiting for hot water, each month. You're going to be surprised.
To solve this problem you can put in a circulating hot water system. To do this can be quite simple or it can be rather hard, depending on how the plumbing was first installed. First trace out the hot water line. If it's well exposed then it will be quite simple to install this system. Follow the line from the water tank to the outlet that is the greatest distance from the tank. Turn off the power to the tank and drain the hot water side of the system, completely, including the tank. Where that 90 degree elbow turns to go to the outlet, remove that elbow and replace it with a tee. Next go to the water tank and remove tha drain valve at the bottom of the tank and replace it with a short pipe ******, then a tee and then reinstall the drain valve in the other end of the tee run. Now install a line from the first tee at the outlet and run it back to the tank and install the other end to the tee branch side. Insulate the line with some foam insulation that can be purchased at any big box or plumbing store. At the top of the water tank remove the cold water line, coming into the tank, and install a flow check valve. MAKE SURE THE FLOW DIRECTION IS GOING INTO THE TANK. WARNING, DO NOT INSTALL THE CHECK VALVE BACKWARDS. Then reinstall the cold water to the tank. On the hot water outlet side of the tank remove the line and install a small electric inline water pump. This is the most expensive part of this installation. These pumps are very small, but the cost is rather high considering their size. You'll only need about a 1/8th to 1/4 HP size pump and the cost will be a little over $100. Install the pump in the line and reinstall the line to the tank. Fill the tank with water and check for leaks. Run the electrical line to the pump, then turn the power back on to the tank and pump and the installation is done. DO NOT RUN THE PUMP WITHOUT WATER IN THE SYSTEM.
Now what you'll have is a system that will provide hot water as soon as you turn on any hot water outlet, since the pump is constantly circulating hot water from the tank, through the system and back to the tank, keeping the line always heated. Insulating the entire hot water line, from the tank, back to the tank, will also help to lower your power bill. In a few months the cost of the pump will be made up by the amount of water saved that was wasted before, trying to preheat the line running to the outlet, that was being used. You will notice a drop in the amount of water used and your electric or gas bill will drop a little.
I installed this type of system in 2 homes I use to own and in my sons home and each time the system did pay for itself, in a short amonut of time and worked fine.
Hope this helps.
And NO, I am not a plumber, ...... never wanted to be one, but have worked around a few, in the construction trade, I worked in.