Bills rising faster than inflation: here’s how you beat them

10 January 2019

Annual household bills have risen by over £550 in the past three years – increasing nearly three and a half times faster than the rate of inflation, new research shows.

Price comparison site ComparetheMarket analysed the average cost of energy, home and motor insurance since 2015.

It found that on average people are paying £2,590 for these three products over the year – up from £2,032 in 2015 – highlighting the growing financial pressure households are under as the cost of living continues to rise.

The biggest contributor to the rise was  energy bills, which have gone up by £417 since 2015 to £1,706.

In the past two years the Big Six energy providers have hit customers with a series of price hikes resulting in many switching to smaller challenger providers.

Motor insurance bills have also jumped following increases to insurance premium tax and rising compensation payouts. The average motor insurance policy in 2018 cost £724, compared to £611 in 2015 – an 18.5% increase.

Rise in household bills since 2015
 201820172016    2015
Motor insurance£724£738£693£611
Home insurance£160£142£135£132

Source: ComparetheMarket

Simon McCulloch, director at ComparetheMarket, says: “Hikes to bills have come from all directions in recent years with multiple increases in insurance premium tax driving up insurance premiums and the Big Six’s relentless energy price hikes forcing loyal customers to pay ever more for a basic living requirement.

“The research highlights just how important it is for people to be aware that, when it comes to your bills, loyalty does not pay. Customers who don’t shop around are paying the price associated with inertia.”

Top tips on keeping your bills down

Shop around to beat the loyalty penalty

Research from Citizens Advice has found that consumers are being ripped off by over £4 billion a year by businesses that take advantage of their loyalty.

The so-called loyalty penalty occurs when customers of a business pay higher costs for staying with the same product, while new customers pay significantly less.

Whether it is energy, insurance, broadband or your mortgage, shopping around can help you find the best deal out there.

If you are coming up to the end of your contract, check out the prices of rivals online. Alternatively, you can contact your provider to negotiate a better deal than the one you currently have.

Switch your energy supplier

Energy regulator Ofgem says 54% of households remain on poor-value default deals, meaning over 15 million people are paying hundreds of pounds more than they need for gas and electricity.

Meanwhile, there is as much as a £352 difference in the cost between a dual-fuel standard variable tariff (SVT) and the cheapest available tariff if you get your energy from one of the Big Six.

Plenty of challenger energy providers are now offering deals that beat the Big Six.

Get on a comparison website where you can compare energy providers and tariffs to find a better deal.

According to energy switching rules, anyone on a fixed-term tariff has a right to switch to a new deal without paying exit fees when there are 49 or less days before the fixed-term ends.

Use less energy

There are plenty of things you can do to save money on your gas and electricity bills.

Turning down your thermostat by just 1°C could help you shave 10% off your heating bill.

Boilers account for over 50% of what you spend on energy every year, so getting a new one could knock hundreds off your bill.

Getting loft and cavity wall insulation is another energy saving solution that can help you save money.

Energy efficient light bulbs can also reduce your bills as they are four times more efficient and last up to 10 times longer than normal incandescent ones.

By using a timer on your central heating system you can set heating and hot water to come on only when you need it.

Get a water meter

With a water meter you will get charged for what you use, rather than a flat rate.

If you live in England and Wales you can get one fitted for free.

Estimates of how much you could save each year by having one vary but it could be as much as £100.

The amount of money you save will depend on factors including your usage, how much you currently pay and the number of people living in your property.

Getting a water meter installed does not necessarily mean you will save money though.

A water meter is most likely to benefit those living alone or using small amounts of water.

If your house has a high rateable value it may also be worth changing. This is because water bills are calculated on the rateable value of the property.

As a rule of thumb, you will be paying less if there are more bedrooms than people in your household.

Shopping and direct debits

Research from Citizens Advice suggests that people are spending an average of £160 every three months on services they don’t use, so go through your bank statements and check all your direct debits.

It can be easy to lose track of them and you could be paying for things that you don’t use such as gym membership or credit rating subscriptions.

You could also try changing your shopping habits.

Buying in bulk can help you reduce the cost you pay for items while shifting to own-brand products will also help you reduce your bill.

Shopping around for the cheapest prices is also a good idea. There is plenty of choice out there now, and budget supermarkets such as Aldi and Lidl are putting pressure on the bigger rivals to reduce their prices.

If you are looking to make some savings, you can also go to a website such as, which can help you compare the prices between supermarkets.

You can also save money on fuel by shopping around for the best price. Find the cheapest prices locally by entering your postcode at


In reply to by anonymous_stub (not verified)

Done all that. Water meters save money if they are working correctly. Be warned some companies fail to read them and are fully prepared to argue the toss if you doubt the accuracy. I spent ten years arguing and they finally got round to looking into it. My bill dropped by over half! No refunds though and the next half year they were all set to charge me an estimated figure which was around three times the metered sum!Oh and no mention of council tax which raises by about twice my income. And then they want me to spend more!

In reply to by anonymous_stub (not verified)

Bills are inflation...

In reply to by anonymous_stub (not verified)

I disagree about home insurance as I find it has dropped a lot in price if you shop around or challenge your insurer before renewing, same applies to car insurance, I am going to do same with my breakdown cover in future as well. It is also simple to switch energy suppliers each year to ensure you are on cheapest deal. Only thing can't save on is water bills , on meter but that has shot up in price for low users as they encourage water wastage, if they wanted to cut water wastage they should stop standing charges and increase price per cu/mtr so you just pay for what you use.

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