Why
you’ll be £1,000 a year poorer
The price of six key things in your life is going
up - rapidly. It's going to cost you a packet
unless you take action now.
The past few weeks have been a disaster for consumers.
The price of some of life's essentials is shooting
up and the total cost to you over 12 months could
be as much as £1,000.
Here's what's been happening and what you can
do about it.
1. Petrol prices
World oil prices have been nudging 13-year highs
because of fears that escalating instability in
Iraq will disrupt supplies from the Middle East.
This has had the usual knock-on effect on the
forecourt of your local garage:
The average price of unleaded petrol is now 83.5
pence a litre. And it is likely to rise a few
more pennies in the coming months.
Diesel prices are averaging 79.9 pence a litre
and the government is planning a tax rise on diesel
of 1.92 pence per litre from September 1.
What it will cost you
Motorists are likely to be about £10 a month
worse off as result of rising petrol prices. The
government is bracing itself for a new wave of
fuel protests.
How much will your next big journey by car cost?
Use our handy petrol estimator
What you can do about it
Make fewer car journeys – many short trips
are unnecessary and can be completed on foot,
bike or public transport. If you drive to work
find out if you can car share with someone else.
A more drastic idea would be to change your car
for a smaller, more economical one.
Try MSN Cars for great prices on new and used
cars
2. Mortgage rates
The Bank of England has raised interest rates
three times since November.
What it will cost you
Homeowners on a variable rate mortgage are now
about £60 a month worse off compared with
October 2003.
What you can do about it
You can't stop the Bank of England putting up
interest rates but you can ensure you are getting
the best deal on your mortgage
Compare mortgage rates here
The Bank also indicated on May 12 that interest
rates are going to continue rising. Some people
may decide now is a good time to switch to a fixed
rate mortgage
Lowest rates on fixed rate mortgages here
3. Energy bills
A raft of increases to gas and electricity tariffs
have been announced in the past few months. Here
they are:
British Gas - 5.9 per cent gas and electricity
increase – effective January 2004
Powergen – 5.6per cent gas and electricity
increase – effective January 2004
Scottish & Southern – 4.9 per cent gas
increase – effective February 2004.
npower - 5.8 per cent gas and electricity increase – gas rise effective February 2004, electricity
rise effective April 2004.
Scottish Power - 5.2 per cent gas and electricity
increase – effective March 2004.
EDF – 7.4 per cent gas and electricity increase
– effective March 2004.
Energy supplier Atlantic Electric & Gas increased
gas prices for all new customers by an average
15.2 per cent effective March 2004
What it will cost you
Taking Scottish Power as an example, the worst
hit customers will be paying up to £30 a
year more for gas and £23 a year more for
electricity, according to comparison service uSwitch.com
What you can do about it
Switching supplier these days is easy - you can
do it online. We've teamed up with uSwitch.com,
an Energywatch-accredited price comparison service,
to bring you a quick and easy way to see which
suppliers could save you the most money. You could
save up to £170 a year
Click here to see if you could save
4. Airline tickets
British Airways has become the latest in a growing
list of airlines to impose a fuel surcharge to
ticket prices because of surging oil prices.
On May 13 it said it would add a fuel surcharge
of £2.50 for every single flight effective
immediately, and would review the charge on a
regular basis. British Airways' decision came
on the same day that Australia's biggest airline,
Qantas, announced fuel surcharges between A$6
and A$15 to tickets.
What it will cost you
If you take two return flights a year with BA – like many people who take two holidays
a year - then that’s £10 a year more
you’ll be paying.
What you can do
Make sure you are getting the best deal on airfares.
For worldwide travel you can compare prices at
expedia.co.uk
For budget airline travel in Europe compare deals
by using skycanner.net
5. Council tax rises
This year council tax has risen by an average
of about 6%.
What it will cost you
The rise is equivalent to about £50 more
in the region where the average bill is lowest
(Yorkshire and the Humber) up to £72 a year
where it is highest (South East). In England,
the average council tax per dwelling will be £967
in 2004/05, compared with £908 in 2003/04.
What you can do about it
Unfortunately, there’s not a lot you can
do to reduce your council tax bill, short of moving
somewhere else. You might decide that some form
of political protest is appropriate but that one’s
down to you!
6. Water rates
Water UK, which represents water suppliers, recently
announced that the industry was pressing ahead
with plans to raise bills by an average of almost
30% between 2005 and 2010.
What it will cost you
The headline figure being bandied about here is £47 but it could be a lot more. The move
would mean households with a typical current bill
of £240 a year will pay £310 by 2010
- but the final business plans are expected to
reveal increases ranging from £47 up to
£122.
What you can do about it
The government wants to encourage more competition
in the water industry but to say that switching
supplier is hardly as commonplace as it for gas
and electricity would be an understatement.
You can find out more about competition in the
water industry on the Ofwat website ofwat.gov.uk
The Ofwat site also has a handy list of water
companies and their contact details
So what’s the overall damage?
£10 extra on airline tickets a year
£120 a year more on petrol
£720 a year more on mortgage repayments
(comparing today’s rate with last October’s)
£47 a year more on water rates
£53 a year more on energy bills
£59 a year more on council tax
That’s a total of £1,009 more a year.
Follow our tips and links above and you can save
yourself quite a bit of this amount. Here are
some other useful money-saving ideas: |
