I just bought (on clearance for 60% off!) a heatpump water heater. At the price I paid, it should give me a
two year payback in electric savings.
So I paid $600 to replace a water heater that's working just fine. Frugal? Not for the next two years it isn't, but beyond that it's all gravy!
Sometimes the frugal choice is to spend a little more up front.