Shocking ways your laziness wastes over £1,000 every year

Laziness doesn't pay - failing to switch deals regularly means you are throwing money away!

Your laziness is probably costing you a small fortune each and every year.

Millions of us refuse to move around when it comes to energy deals and broadband, meaning that we move from a decent initial deal onto a punishing ‘standard’ rate.

There’s nothing stopping you from finding a better deal when a contract ends. If your provider thinks it’s time for the price to go up, you can up and leave.

Energy supplier

The table below shows five tariffs that are coming to an end on September 30^th, and the price of the standard tariff customers will be reverted to.

*Based on dual fuel payment by monthly direct debit averaged across all UK regions and for households with an annual energy usage of 12,500kWh gas and 3,100kWh electricity.

Sometimes, being switched to the standard tariff may actually save you money, as with the British Gas tariff shown above. But this isn’t true for everyone, and you can still probably find a cheaper deal.

A British Gas customer who is moved to the standard rate might change to First Utility’s iSave Fixed Dec 2016 v3, which costs £840 a year on average and is fixed until December 2016. That’s £235 cheaper per year than British Gas’ standard tariff.

Be careful on one point. Leaving a tariff early can incur early-exit fees, which can cost up to £100 for a dual-fuel tariff. These fees might be waived, for instance in a situation where you are trying to switch to a cheaper tariff with the same provider, but this is at their absolute discretion.

Savings: £235

Compare gas and electricity deals with loveMONEY

Broadband

Millions of us use separate providers for our home phone and broadband. But doing so is an expensive mistake.

broadbandchoices.co.uk says that people could save hundreds by switching from separate broadband and phone services to a comparable bundle.

For example, someone with separate BT phone and unlimited broadband services would pay £359.88 per year, and could switch to a TalkTalk SimplyBroadband bundle which includes unlimited broadband and PAYG calls for £207.15, saving £152.73 in the first year.

Savings: £152.73

Mobile phone

If you’re paying for a mobile phone contract, chances are that any exit fees will be very high. While leaving early isn’t often a sensible option, there’s no reason to stick with your plan once your contract has come to an end, unless it’s an unbelievable deal.

Let's say you are on a Vodaphone contract for £32 per month, which comes with 500 UK minutes unlimited texts and 500MB of 4G data.

When your contract ends, you could switch to giffgaff, whose £10 monthly goodybag comes with 500 UK minutes, unlimited texts and 1GB 4G data.

That’s a saving of £22 per month, or £264 per year, plus you get double the data allowance.

Savings: £264

Car insurance

This is the cardinal sin that many motorists make - sticking with their insurer, year after year. Research from GoCompare last month found that around six million motorists simply renew with their existing insurer, without bothering to shop around.

But the fact is that quotes for car insurance vary massively. And with the best deals saved for new customers, you are throwing money away if you don't at least compare deals.

I’ve used the loveMONEY car insurance comparison engine to find quotes for a married 45-year-old man with 15+ years of no-claims bonuses and no convictions driving a Nissan Note Acenta 1.4l (petrol).

For a comprehensive policy, with a £250 voluntary excess, the cheapest quote came out as £297.21. The most expensive quote was £640.24.

There are a lot of variables here and you’ll need to get your own quotes to see how much you personally could save, but it’s a good illustration of the difference in policy prices out there.

Remember, it’s every bit as important to examine the policy and see what is actually covered as it is to compare quotes. Always make sure you’re getting the cover that your individual circumstances require.

Savings: £343.03

Switch and save up to hundreds of pounds on your car insurance

Home insurance

Our 45-year-old man is now shopping for buildings and content insurance for his three-bedroom terraced home in Bristol. He lives there with his wife, two children and a dog. He opts-in for accidental damage cover for both parts of his policy.

With a voluntary excess of £250 for both buildings and contents damage, the cheapest quote I found was £108.14 and the most expensive was £405.98. The difference speaks for itself.

Savings: £297.84

Mortgage

If your fixed term mortgage has come to an end, you will probably have been moved onto your lender's standard variable rate (SVR). Let’s use our hero’s three-bedroom house in Bristol, with a market value of £250,000, and see if we can save him money.

There’s £75,000 left to pay on the mortgage, and he wants to pay this off over the next 10 years. On an SVR of around 4%, that’ll cost around £760 a month, or £91,200 over the 10-year period.

But remortgaging could save a fortune. If he wanted to go for a 10-year fix, he could get a rate of 3.24% with Nationwide, with monthly repayments of £733, costing him a total of £89,494. That's almost £2,000 saved immediately. And if he went for shorter fixed rates he could potentially save far more. 

Savings: £324

The grand total

Adding up the savings made up from switching all of the above makes up a grand total of £1,616.60.

While this is not a guaranteed saving for all of us (sadly), it highlights the way in which some of us are paying much more while others pay a significant amount less.

Don’t forget to haggle!

If you’re not happy with your current deal and find a better one elsewhere, don’t take the plunge straight away.

It’s worth giving your current provider a call first. Tell them that you’re thinking of leaving as you’ve found a better deal elsewhere, give them details of the offer you’ve found, and chances are that they’ll suddenly take a great interest in you and offer to match or beat it.

At the end of the day, companies want your business, and while they may not make an offer to every customer who calls up to quit, it’s always worth trying.

Cashback

Finally, if you spot a good deal, see if you can get some cashback on top of your savings. Cashback sites like Quidco and TopCashback can help you secure cash sums or percentage-based returns when you change service providers as an added bonus to switching.

Make sure you’ve followed the specific tracking links from these websites before making any order so that your cashback is tracked correctly, or you might miss out.

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