I went the cheap way and started my 10 gallon on distilled water, then used tap (left in gallon jugs in the sun for at least 2 days to help clean it up). After a while, it became obvious that just shelling out the $5 for the 5 gallons of R/O was well worth the price to pay in mixing my own saltwater.
The breakdown I found was like this:
Tap water - high in phospates and additives (chlorine, flouride, iron, copper)
Distilled - pure water, very poor in holding buffers (ergo calcium loss is far higher)
Regular fresh - (from LFS
) pure water, good for all tanks, perfect for non-coral tanks
R/O - (from LFS
) pure water de-ionized - holds a buffer excellently will suspend calcium, iodine, trace minerals and such well in the tank allowing for greater coral absorbing and a more vibrant tank
In the long run, the amount of money you will spend on dosing supplies will outweigh the savings if you are going with distilled. Where I live a gallon of distilled is the same price as a gallon of R/O, so it's a no-brainer. And unless you are very lucky with your tap water... it's just not worth the long hours of rock scrubbing and ich.