How To Manage Your Utility Costs
Electricity, water, phone, gas and internet bills. Everybody groans when these bills arrive.
Nobody likes paying them because it is impossible to predict exactly how much it will cost you every time the bill arrives. The numbers always fluctuate, making it difficult to budget for. Yet incidentally, nobody seems to be able to survive without these utilities.
Ensure prompt payments
The most important thing you need to know about managing your utilities, is to ensure that you are paying them on time. You do not want your bills to snowball, and have to find yourself catching up and paying half a year’s worth all in one go.
To keep on top of all your bills, mark on your calendar when your bill is due. Alternatively, pick a day on your calendar – say the eleventh of every month, and make it the day that you pay all your utilities. That way, you’re bound to never miss payment.
Choose the most convenient payment method
To encourage yourself to manage your bills and pay them on time, you should choose a payment option that suits your needs. Nowadays there are quite a number of ways that people use to pay:
- Paying over the phone
- Paying online
- Paying in person at the post office
- Mailing the payment
- Direct debiting into the provider’s account
- Using Centrepay – those who receive welfare payments from Centrelink can arrange to have a regular amount directly wired to the provider
If you are someone with not enough time on your hands to run to the post office, perhaps direct debit would be most suitable. Alternatively, if you always triple check your utilities bill for mistakes before paying, paying by phone or online would give you the opportunity to clarify costs prior to making payments.
Budget for utility costs based on past spending patterns
Bills are an integral part to your financial planning and goals. Be sure to always set aside cash for that.
For those whose utility costs are not included into the rent, you would definitely have experienced the frustration of budgeting for an ever-fluctuating cost.
Based on past utility bill costs, you can get a rough idea of how much money you should set aside to pay for these bills. Don’t forget to put some legroom in your budget (just in case!). A good idea is to take out the money you need for utilities as soon as you receive your pay check. That way you won’t be tempted to spend it on something else. Plus if you do manage to have cash leftover after paying your bills, you can either pocket the extra change or put it towards next month’s bill!
Leaving a bit of extra room in your utility budget can also act as a great incentive for you to use less gas/electricity/internet because it kind of feels like you’re getting paid for using less of your utilities.
You always get that feeling of dread piled onto your shoulders. You feel faint as your hands tremble towards the envelope. As your body quivers in trepidation, you nervously rip open the envelope to find, yet again…. you’ve gone over budget.
1. Figure out what changed
If your bills have suddenly grown bigger, think back to what new habits you have adopted and take actions to rectify it.
If it’s something beyond your control, like the implementation of carbon tax, then you’d have no choice but to increase the size of your budget. You could also cut back on your use of other utilities (see below for tips) to balance the costs.
2. Choose prepaid plans
If you’re somebody who uses quite a lot of electricity/gas/internet etc., I would suggest you to forego the pay-as-you-go method (which incidentally, often benefits those who tend to use less).
For example, most internet providers offer deals where you can use a certain amount of data each month for a certain cost. Choose a deal that matches your usage. If you choose the right deal, this often becomes the better option because you can use the internet more freely (knowing that it’s not charged per minute). Additionally you can also choose to be alerted when you are nearing your pre-paid agreement.
3. Talk to your provider
If for some reason you’re unable to pay the bill, get in touch with your utility provider and explain the situation.
Most of them should have a hardships officer who will talk to you and help you out. Whether it is suggesting you to apply for utility vouchers or to make arrangements to allow for paying by instalment, a solution can always be found.
4. Apply for rebates or vouchers
If you are eligible, you may be able to apply for rebates and vouchers to alleviate the cost of utility bill repayment. Although every state has a different policy, this scheme is usually open to pensioners, veterans or seniors.
The type of utility that you can apply for also changes depending on where you live. For example in Queensland, electricity and gas rebates can be applied for through the Department of Communities.
5. Smooth our your utility bills
Certain companies like ASL allow “bill smoothing”. This is basically where you are allowed to make regular payments towards a future utility bill to help reduce the final bill cost!
6. Reduce how much you use
The most basic of all ideas is to reduce how much you use to reduce how much you will need to pay. Of course, there is no way you can every get your utility bills down to zero (unless you really decide to go bush). However there are many simple things that you can do to reduce costs:
- Turn off lights when you’re not using them
- Take shorter showers – aim for 4 minutes
- Buy energy efficient applicances (e.g: light bulbs)
- Check toilet/taps/pipes for leaks
- Use a wastebasket instead of flushing the toilet unnecessarily
- Dress for the season to reduce the need to use too much of the heater or air conditioning
- Use the washing machine or dish washer only when it’s full
- Water your plants with water that’s been used (e.g: from the dishwasher)
These simple steps will not only make your pocket love and thank you, but Mother Nature as well!