Water heater timers set specific times for water heaters to be turned on and off. Homeowners typically use them as a way to save energy and money by lowering the on/off cycling rate of their units. Water heater timers are energy efficient, and they ensure the heater's water temperature remains stable and that heat doesn't bleed off from the unit.
Using a water heater timer is usually better with water heaters that are at least around 10 years old. The reason for this is that newer models are often better insulated against heat loss and are already designed to be more energy efficient. There's still a chance that owners of newer water heaters can benefit from using a water heater timer, but they don't save as much as owners of older water heaters. In addition to a water heater timer, homeowners can also insulate their water heaters to save money and make their heaters more energy efficient.
Usually, water heater timers cost anywhere from $35 and $55 at home improvement centers. This doesn't account for the cost on installation, which should be done by an experienced electrician. As of 2015, the cost of having a water heater timer installed is roughly $70.