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There is no temperature gauge on my water heater.
I ran some hot water into a glass and then stuck a meat thermometer in it.
I don't remember what the exact temperatures were, but it used to be that in the shower - all the way to hot was enough to be painful and now it is just hot enough. Hot, not warm, hot, but not scorching hot.
I think having a smaller house that is well insulated is a very smart long term investment. Stick that extra $100 a month you aren't spending on utilities and invest it.
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