Watch this video from This Old House to learn how to change your water heater anode rod.
1 Turn off water and fuel supply (gas or electricity) to water heater.
2 Partially drain the water heater.
3 Locate the anode rod on the water heater; if necessary, unscrew and lift off the cover from the top of the heater.
4 Use a ratchet wrench and 1 1/16-inch deep socket to unscrew the anode rod from the heater.
5 If the anode rod won't budge, slip a steel pipe onto ratchet wrench handle for extra leverage.
6 Lift out and discard the old anode rod.
7 Wrap Teflon tape around threads of new anode rod; insert anode rod into water heater and tighten with 1 1/16-inch socket.
8 If limited space above the heater prevents the installation of a standard anode rod, install a collapsible type.
9 Turn on the water and fuel supply to the water heater.