Right now, many residents in England, Scotland and Wales are worrying about the huge increase in energy prices in just one day’s time.
April is set to see energy prices increasing by more than 50%, or close to £2,000 for the average household, which may lead to a further financial struggle for many families around the country.
The energy price cap, which is the maximum amount that a utility company can charge customers, will be rising from £1277 to £1971 on 1st April, which will be an increase of over £690.
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In light of the energy price hike, LADbible has compiled a list of three things you need to do before energy prices change, according to a video by Martin Lewis.
Three energy-saving tips:
Martin Lewis recently shared a list of three ‘urgent must-knows before 1 April’, which includes doing a meter reading, learning why switching from Direct Debit costs more and understanding whether you should fix your energy rates right now.
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Here’s Martin Lewis’ energy-saving tips:
1) Do a meter reading:
At some point before 1st April, do a meter reading and send it to the company there and then.
The money-saving expert explained how this will allow customers to ‘draw a line in the sand’ between the energy used by 31st March and the energy used thereafter, meaning the companies should not be allowed to charge a more expensive rate for energy that has not been used.
2) Stick to Direct Debits if you can afford it:
Stick to your Direct Debit payments if you can afford it.
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For those thinking of ditching their Direct Debits, Lewis stressed that while 'you may gain control, it will cost you more' to pay for your energy without direct debit.
He used average figures to demonstrate why direct debits would be the cheaper option, saying: "If you're on typical usage the price cap from the 1 April for somebody paying by Direct Debit is £1,971 a year. If you pay by on prepayment it's £2,017, but of course you'll need a pre-payment meter for that.
"If you want to pay by quarterly bills [...] then the price cap is £2,100, so that means you're paying over six percent more for the same usage than you do by direct debit because there is a discount allowed for direct debit."
3) Decide whether it’s worth fixing your energy rates:
Lastly, you should decide whether it’s worth fixing your energy rates.
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Lewis used estimates to recommend a fix that is 'no more than around 18 to 20 percent above the April price cap before it is worth contemplating fixing'.
The cheapest open market deal is 'around 40 percent more' than the April price cap, Lewis explained, so 'with the lie of the land as it is today', the expert said it is 'not worth fixing' and said you're better off to 'stay on the April price cap and then if nothing changes before that go on to the new October price cap'.
LADbible is not an energy or financial advisor and have simply based these tips on Martin Lewis’ estimates for what to do before April 1.
Featured Image Credit: Chris Rout / Alamy Stock PhotoTopics: Martin Lewis, Money, Hacks
