Personal debt advice

I had a really massive shock this week – and all thanks to the arrival of the yearly energy bill summary. A year ago, I did what I thought was the sensible thing and swapped my energy provider, thanks to figures given me to a guy who came to the door, demonstrating that he could save me money. My bills fell by about £20 a month on direct debit, so I was pretty chuffed.  Imagine my shock, therefore, when my yearly statement arrived showing a debit of £287.

It was clear that the energy company hadn’t calculated the premium correctly when they set the direct debit amount – maybe that was their way of pretending to save me money, who knows!  The biggest shock, however, was that they said they were now going to hike my direct debit premium from £61 a month to £180 a month!

Now I know that energy prices have risen, but a trebling in my bill left me incredulous.  When I worked out my consumption figures for the last year, I found that I’d actually been using £45 of gas and £25 of electricity a month.  In other words, what I was paying previously was pretty much spot on.  What this energy provider was doing, however, was moving me to a “new plan” – one that was charging a vastly increased amount per unit, for both gas and electricity, hence the hike in monthly payment.

I’m sharing this with you, because it demonstrates how you can save yourself a fortune, if you read the small print.  The “new plan” was going to charge me around 24p per unit for electricity and around 8p per unit for gas.  This then fell slightly after a certain number of units were used, but not enough!  I picked up the phone, rang my last supplier – again the cheapest in the market – and have moved to a rate that will charge me 13.2p per unit for electricity and 4.3p per unit for gas.  I will be paying £70.54 a month, rather than £152 a month, had I cleared the debit of £287 and then paid another fixed amount per month.  In other words, I’ve slashed my future bills by half.

Everyone should be shopping around in these situations, but for those in personal debt, it’s even more important.  When every penny counts, you need to save them and energy is one area in which you really can make some savings, if you are with an uncompetitive supplier.  Debt advisers at Debt Free Direct can help you do this, if you need to speak to a debt counsellor and get debt advice about all sorts of things within your personal finances, but you can also do what I did and take action, to prevent personal debts building up.

Debt advisers tell us that energy is a massive concern for many people in our society these days, from the elderly, to families struggling to keep their heads above water.  If your income has been cut, due to reductions in overtime or redundancy, slashing bills is vital, so don’t delay or you will be paying out unnecessarily.  If you are in some sort of contract that prevents you moving for a while, check out penalty clauses, because it may still be financially worth your while to switch provider and pay the penalty. If you absolutely can’t switch yet, note the date on which you can in your calendar and make sure you move as fast as you can.

I’m pretty chuffed with my £80-a-month saving and I’m sure that anyone struggling to pay bills, make debt payments and in serious need of debt advice would feel exactly the same.

Dig your energy bills out, look at the small print and make the move by calling our money savings team on 0844 826 2537. From a mobile it may be cheaper to call 01257 486961. On average we save our customers £150 on their household bills. Call us to see how much you can save!