Many of us will be approaching the summer with a sense of financial relief.
Why? No more heating bills. But just because you are about to get a break from them, doesn’t mean you should forget about your heating bills. Instead, now might be just the time to have a go at making next winter a whole lot cheaper.
Here’s how.
Don’t trust the energy firms
If your mobile phone company told you that they weren’t really sure how many phone calls you’d made last month, but they had taken a stab at guessing and billed you on that basis, you’d be furious. So why aren’t you cross when your energy company does exactly that?
Most of us get estimated bills – and an estimate is no better than a guess. Which explains why so many of us end up with the wrong bills. In each quarter, we may underpay or overpay as a result of bad guesses on the part of your provider.
That matters simply because it usually means a shock of some kind in the end. Once your meter is read, you’ll have to pay the difference if you’ve been underpaying. And the average bill after an accurate meter reading? £153. That’s enough to play havoc with most budgets.
So don’t trust an estimated bill. Instead, regularly send your supplier meter readings. Most firms let you send in readings by text, email or using an automated telephone system, so it really isn’t hard. And that way you’ll only ever pay for the energy you’ve used, when you’ve used it.
Get the best deal
If you haven’t ever switched energy supplier, you could be paying around £400 a year more than you need to. Even if you have switched before, perhaps a few years back, you should think about switching again.
That’s particularly the case if you are one of the many who moved on to a fixed rate deal five years ago when energy prices first started to rise. You’ll now be hitting the end of your deal, and will see a steep rise in bills unless you move on now.
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And even if you aren’t on a fixed deal of any kind, it is still really worth checking the comparison sites once a year (more often and its just too boring, less often and you might cost yourself proper money) to make sure your deal is still a reasonable one.
Compare the comparison sites
When comparison websites first appeared, they were sold as one-stop shops where you could go and find the best deal. That hasn’t turned out to be quite the case.
No comparison website covers all the energy providers (or insurance/savings/credit card firms), so to be thorough, you need to check a few. Another reason to not go with the first ‘best buy’ you are shown is that it might be available cheaper on another site. Comparison sites sometimes have special deals and offers from providers, so shop around in case you could get the same deal cheaper elsewhere.
When you have a spare half hour – switching energy provider can easily be done in a lunch break – check all of these websites: Uswitch, MoneySupermarket, Comparethemarket.com, Confused.com and Gocompare.com.
Change the way you pay
When you are shopping around for a new energy deal, also consider the way that you pay your bills. The cheapest deals are available to people who are prepared to manage their bills online – cutting costs for their provider.
You might also want to consider paying your bills by monthly direct debit. That way you can spread the cost of your heating bills year round. Paying a little each month so that you don’t face one huge bill in winter. The downside to this though is you are losing out on getting interest on that money. If you want to make the most of your money, you’d be better off saving a little each month into a savings account and just paying your bills when you get them.
Do all this, and you should avoid any big, shocking bills.
• This article is taken from our weekly MoneyWeek Saver email.
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