Most Important Rule of Thumb: Never let your drill bit run dry.
This may sound trivial but heat is the most important factor for the life and performance of these tools.
Use of cool water is a simple and effective way to keep the tool from burning up.
Over the years we have seen:
a- People building a mini dam around the hole with plumbers putty or similar materials.
b- Some prefer spraying water on the drill.
c- Some use running water to cool the drill bit.
d- There are people using crushed ice with cold water.