Three Switches That Should Save You £400

Citizens Advice has dealt with 3.25m debt and benefit problems in the last year alone, a record for the organisation. Many of these relate to fuel debts, overdrafts and phone debts. But by getting a better deal on each, you can save £400 on average, which will go a long way to wiping out any debts. So here is how you can help yourself reduce those bills before they become a problem.

Fuel debts are up by a third

Wholesale gas prices reached £1 per therm in 2008, but have fallen back to around 38p, according to energy specialists McKinnon & Clark. Wholesale electricity prices have gone from £90 per MWh to just £37 – both falls of around 60 per cent. So annoyingly Energy bills are up while the energy companies enjoy bumper profits. Could there be a better reason to check that you’re not paying more than you have to? You can save an average of nearly £250 by getting the best deal available to you by comparing the whole of the UK energy market.

Phone debts up by nearly a third

Another household bill is causing real debt problems for many – Citizens Advice has helped nearly 19,000 people who are struggling to pay phone debts. It is going to get worse too, as from April 1 BT is changing its calling charges, and the time of its free evening and weekend call plans. From then, calls made between 7pm and 7am will be free, rather than 6pm to 6am. How many people make calls in the early morning. So do some research to get a better deal on your home phone. On the Primus Home Phone Saver you can get free evening and weekend calls to local, and national landline numbers with a line rental of £9.15 a month. Just to compare, making a 20 minute phone call each day between 6pm and 7pm is currently free on the BT off-peak charging plan. But from next month, it could add £80 to your quarterly bill. BT’s standard call rate is going up from 9.3p a call to 9.9p from April, and daytime calls will rise from 5.4p a minute to 5.9p a minute.

With the Primus Home Phone Saver, if you made calls in the day, they would be charged at 3p a minute to landline numbers. The cost of calling mobiles is a lot more, with most at 14.8p a minute in the day, 11.9p in the evening, and 8p a minute at weekends. So make sure you are not going to be calling in the day too much, otherwise this will wipe out your saving.

Overdraft problems up by a quarter

More people are living in their overdraft to make ends meet, and that has brought a quarter more people in to Citizens Advice for help. But we can help you to help yourself. Alliance & Leicester is offering a 0 per cent overdraft up to £2,000 on its Premier Current Account plus if you apply before March 7, you will get £100 to switch too.

Its Premier Direct Account is also offering a 0 per cent overdraft up to £2,000, for 12 months, so you would not be charged for going overdrawn. You have to pay at least £500 into these accounts each month though.

Even better, Bank of Scotland’s Reward will pay you £5 a month whether you are overdrawn or in credit providing you pay in £1,000 a month. Its overdraft has 0 per cent interest too, so you are effectively being paid to borrow up to £2,500.

If you are in your overdraft, you may not be able to close your account until it is cleared, so you may need to open the other account first, use the overdraft on that account to get the cash to clear your existing overdraft, then close that account and have all of your direct debits transferred over. You could always keep the two accounts open if you want. Just don’t use the overdraft in both.