Without an iota of doubt, it is clear that 2016 was a year of stretching incomes due to increasing household bills. The pinch from the price rise was clear as there was a 10% increment in the household bills which formed due to the collective effect of the energy price hike, increase in Insurance Premium Tax on car insurance and home insurance cost.
Going by statistics, an average £100 price rise was observed on annual energy bills and £96 was added in car insurance costs due to the increase in IPT. Figures suggest that an average household needed at least £2,223 in 2016 to pay their energy bills as well as motor and home insurance costs. The current government has hinted that this will further increase in June 2017. In addition, there are fair chances of increases in energy prices as the wholesale prices seem to keep going up.
Experts suggest that the cost of living has increased in general as apart from the household bills; there is a considerable increase in train fares as well as rents. A 2.3% hike in train fares was observed in the last year while rent increased at a slower pace. However rental charges for homes are expected to climb aggressively due to the new stamp duty levy. Predictions suggest that there would be a 3% hike in rents by the end of 2017. This reveals the inevitable fact that general living costs and household bills are proving quite stressful for UK citizens.
According to a survey, nearly 22% of people i.e. a whopping 11 million people consider household bills as the biggest reason for stress. Backing this report, it was concluded that nearly 41% of people felt that 2017 would be a tighter financial year for them. They attribute it to the fall in pound after Brexit, political uncertainty, rise in inflation as well as rising household costs.
How to deal with the rising household costs in 2017?
Keep those bills to a bare minimum: Energy bills take away a big chunk of our earnings and occupy a fat space in our monthly budget. These bills can be reduced by taking measures like installing smart meters, saying NO to standard tariffs and choosing the cheapest energy tariffs. These small measures can reduce your energy bills by hundreds of pounds making it the best way to combat the price rise scenario. It also ensures no wastage of energy and is a positive way to deal with the situation.
Re-mortgaging: Home owners can minimise the mortgage premium payments by re-mortgaging to a cheaper rate. They should also have a mortgage insurance which saves them from any unexpected events like price rises by the lender. For this, you need to shop around so as to find the cheapest mortgage insurance provider.
Essentially, you need to stop wasting energy, food and other valuable resources that cost you money for your household. Moreover, shopping around is a simple and intelligent way to choose a better provider for energy and insurance. If you are stuck on the same tariff then you need to move on to a better cheaper deal.