Saving on your bills

If you’re spending too much on bills every month, don’t panic! You can find yourself a better deal by changing suppliers, and it doesn’t take a lot of time or effort to find the right one for you.

Jasmine says:

“The average household could save around £1000 in a year just by switching all their bills. If you think that you’re ‘earning’ rather than saving an extra £1000, you might get more excited about it. Imagine how you would feel if someone told you that you could make £1000 in a day just by spending time on your computer? You’d race to do it. Well, that’s what you would do if you spent a day or a couple of evenings going through all your bills and switching providers”

Gas, electricity, TV, broadband and phones

If you’re still with the original gas, electricity and phone companies that you started with when you moved into your house then you’re probably paying too much! Sometimes, getting out of a bad contract can cost you less than if you stayed with it to the end. Here are some things you can do:

• Get all your paperwork together. Just grab some of your latest bills and highlight the prices you’ve been paying and how much you’ve been using on average so you know exactly how much you’re currently paying.
  
• Go online and use a comparison website to find the cheapest options available to you. You’ll usually have to type in a few details about your current supplier and how much your yearly bill comes to first. Use as many comparison websites as you like to make sure you’re definitely getting the right deals, for example www.moneyexpert.com, www.uswitch.com or www.consumerchoices.co.uk.
  
• When you’ve chosen a deal you’d like to switch to, you’ll have to fill in an online application. This is so they can pass your information on to the new supplier. They’ll usually get in touch with your old suppliers to organise a final bill and transfer you across. Easy!
  
• If you’re not already, you should look at getting your phone and broadband services in the same bundle. If you have a TV package you can usually include that in the same bundle too. By paying for them all together from the same provider you’ll be paying less than if you paid for them separately.

Insurance policies

Getting a cheap deal on insurance is more difficult. You need to make sure that your policy covers you for everything you need it to, which doesn’t always mean taking the cheapest option. It’s still worth shopping around on price comparison websites and by calling up companies to make sure that the policy you go for is good value though.

Car Insurance

What level of car insurance do you need? Fully comprehensive, fire and theft or just third party insurance? Chances are, third party insurance will be the cheapest, but does that mean if you were to have an accident you’d need to cover the cost of all the repairs and legal fees? Bear all this in mind when picking the policy for you. For example:

• Third party fire and theft
  This covers you if claims are made against you for damage or injury to other cars or people but not for your own car. It also covers you if your car is damaged (or you are injured) by fire, or if your car is stolen.
  
• Fully comprehensive
  This is the same as Third party fire and theft but it gives you even more cover. It will pay for any medical expenses, personal belongings that are stolen or damaged and it’ll give you personal accident cover.
  
• Third party only
  This covers any claims made against you by other people. You would have to pay for your own car’s bumps and scratches and you’re not covered for fire or theft.

What about insurance excess?

Insurance excess means that if you have an accident you agree to pay a certain amount of money, for example the first £250, so that your insurance premiums (the amount you spend each month) go down. However, this does mean that if you have an accident you’ll need to be able to pay the amount you agreed on.

Jasmine’s tip:

Trying using websites like www.comparethemarket.com or www.kwikfitinsurance.co.uk to compare the prices you can get on your car insurance and pick the deal that seems right for you.

Home contents and building insurance

It’s worth remembering that your building insurance needs to cover the cost of actually rebuilding your home, not the current value of your property. Usually the insurers you get in touch with will be able to help you work this out. For contents insurance, don’t underestimate the value of your possessions as you could be left out of pocket if you ever needed to make a claim.

If you’re renting or you’re in a council property then you won’t need to get any building’s insurance but you might still need contents insurance to cover the cost of your clothes, books, electronics and any furniture you own.

Jasmine’s tip:

Try paying for this insurance once a year rather than in monthly instalments if you can manage it. This means you don’t get charged interest on the instalments.

Credit cards

If you find yourself paying a lot on your credit card each month, it might be worth thinking of switching cards. There are a few choices that could help you depending on how much debt you owe.

• 0% balance transfer – If you have several debts elsewhere then you can combine them onto this kind of card so you can pay it off, without any interest, over a certain number of months. There may be a balance transfer fee of around 2-3%. For example if you wanted to transfer over a £1,000 debt you might have to pay £20-30 to do so. However, sometimes you’ll find an offer where the fee has been waived.
  
• Low-lifetime balance transfer – If you don’t think you can pay your debts off within the time limit of a 0% balance transfer card, you can get one of these cards which will let you pay it off for as long as it takes with a low interest rate. If you have a very large debt you want to transfer over, this choice may be better for you in case the balance transfer fee on a 0% balance transfer card is particularly high. For example, if you had a debt of around £10,000 to transfer over then you’d need to pay around £200-300 for the fee. By using a low-lifetime balance transfer instead then your payments in interest may be less than the fee.
  
• 0% on purchases – If you're going to use your card for purchases more than transferring debts across then a card with 0% interest on purchases could help as you won’t have to pay interest on anything you buy with the card for a few months.

To see how you could save more money by picking the right bank and bank account for you, continue to the next page on Choosing the right bank >>