How to Lower Household Bills

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There are several reasons as to why lowering household costs is important. The obvious and most common reason is in order to save money. Whether it be to build on savings, fund a child’s college education, or to retire comfortably, saving money on monthly expenses like the phone bill allows for more financial flexibility down the road. Another big reason why people are trying to cut costs is to reduce spending at work. In economic times where jobs are not always guaranteed, it is important to make the most of one’s profession. This may require going the extra mile and consuming more energy at home in order to meet a deadline later in the evening. By lowering home energy costs, extra work costs are offset. An example would be if someone working at a salaried job were to still do some hourly consulting and spend extra time not billed to the company. In taking an effort to save money and reduce bills, it may be possible to quit the consulting job early and have more free time. This effort to be more efficient and reduce extra work is another reason why it’s important to cut household costs.

Importance of Lowering Household Bills

So why is it important? The main reason is money. As the bills are lowered, more money will become available to you. This can mean a higher standard of living, or can be money put towards other things, perhaps a holiday or a new car. There is also more money for emergencies, which are unforeseen events that tend to cost money – a job loss, large repair bill, or an illness, for example. Extra money can also be put towards retirement. With today’s generation having an increasing life expectancy, and the UK retirement age becoming higher, it is likely that retirement is going to cost a lot of money. Anything that saves money in the long term is an investment, and saving on bills is a good one.

A household bill can be an expensive outgoing. It is also something that can easily get out of control, with the rise in prices from creditors and an increase in new technology that is power hungry. Lowering the bills should be a priority for all households and is something that can open up a lot more doors for you. When the situation is assessed, some of the findings may be very surprising – it is likely that you are spending a lot more money on bills than you first thought. There are also a number of different ways to lower the bills, so it should not be as hard as it seems.

Benefits of Lowering Household Bills

One of the best reasons for lowering household bills is simply to avoid financial ruin. During the last century, it seemed as if Americans were actually encouraged to spend every dollar their income could buy. Very little regard was given to future financial security with an ever-increasing dependency on credit. Turning this cycle into one of prudent saving and reduced spending is going to have to start with increased efficiency, and that means lower household bills. Having extra funds at the end of the month can make a huge difference in the family’s ability to meet financial goals. Most families spend more when they have more because disposable income is a rare thing. This rule can be reversed too; spending less when there is less, allowing the saving of extra disposable income. Lowering bills is the only way to provide disposable income yet without a raise in income and quite often lower bills can be more easily accomplished. By saving money on bills and reducing the overall flow of energy and water into the home, future cost avoidance can be a significant source of additional income. An extra dollar saved is an extra dollar that never needed to be earned. Future cost avoidance is the result of a good choice now that will eliminate the need for a bad choice later. An obvious example is the use of energy-efficient appliances to replace failing units. The choice to spend more now will result in less expenditure overall. A final benefit is economic freedom, which can be quite simply defined as the ability to have more flexibility in the job market with less concern for financial repercussions and the ability to retire comfortably. All these benefits can stem from the simple fact of lowering household bills.

Energy Efficiency

Insulation and weatherstripping work to provide a thermal boundary between the interior of your home and the outdoors. By minimizing these fluctuations, insulation reduces the energy needed for heating and cooling. Most people are aware of the common locations in a house where heat escapes. However, it is surprising to see how often the insulation in areas such as the attic is overlooked. Aerogel insulation is an extremely efficient form of insulation if you are willing to pay the extra cost. Although this may not be cost-effective for some people, there are often government grants available for energy-efficient home improvements. When it comes to choosing insulation, there are many different types. It is important to research and consider factors such as R-value, cost, and environmental impact. One of the easiest ways to reduce your heating/cooling bill is to minimize your thermostat use. The advent of smart thermostats has made this an even more efficient process. Smart thermostats learn your habits and schedule, automatically adjusting the temperature of your home when you are away or at rest. This feature alone can save people a substantial amount of money. Other features of smart thermostats include smartphone control, filter change reminders, and energy usage statistics. These statistics are a great way to see if changes that you are making to your house are affecting your energy usage.

Insulation and Weatherstripping

Insulation is used to protect the house from the outer weather conditions. Insulation is the resistance to the flow of heat. In the winter, it keeps the heat inside and the cold outside. In the summer, insulation keeps the cool air inside and the heat outside. An insulated home is a much more efficient and comfortable environment. After insulation, weather stripping is an added barrier between the outside and in. Weather-stripping is a material often made out of “felt, rubber, vinyl or metal that “resists” the entry of air carried heat, through the cracks around operable windows and doors”. Combined with insulation, weather-stripping can significantly reduce your heating cost. Both insulation and weather-stripping combined can cost around $4000 for an average home and can reduce heating cost by 20% and reduce carbon and sulfur dioxide emissions. There are many other simple changes that you can make to reduce heating costs. Closing the fireplace damper when a fire is not burning will prevent the suction of air from inside the house to outside. This can reduce your heating cost by 2% of existing bills. Setting back the thermostat from normal setting by 1C can reduce heating costs by 10%. Utilizing curtains can help to save heat. By leaving curtains open during the sunny part of the day and closing them as night falls, you can trap warm air inside the house. Closing curtains on windows that receive no sun will insulate the window and reduce heat loss. A cheaper alternative to new insulation is using clear plastic to cover windows during the winter months. This can reduce your heating bill by a further 2-3%.

Energy-Efficient Appliances

Of all household appliances, the clothes washer and dryer use the most energy. Washing machines and clothes dryers are second only to refrigerators in energy consumption. High-efficiency washers (HEWs) use approximately 25 percent less energy than standard models. Energy savings are most prominently displayed during the water heating process. Since HEWs use a special washing system, there is less water to heat which results in additional cost savings. Front-loading washing machines also save a great deal of energy. Since they use gravity to do the wash agitating, front-loading washers use less energy to move the clothes, saving it for the specific task of washing. It is also possible for a washer to earn the ENERGY STAR label by meeting the energy-saving guidelines set by the US Environmental Protection Agency and the US Department of Energy. Any washer that meets these guidelines as of February 1, 1998, is 35-50 percent more energy efficient than standard washers. An ENERGY STAR labeled washer purchased in 2009 can save up to $135 a year in energy costs. Like HEWs, energy-efficient dryers use 20 percent less energy than standard models. However, the only difference between energy-efficient dryers and standard models is the price. High-efficiency dryers are not promoted or labeled as prominently as HEWs and often cost the same as standard models. For this reason, it is difficult to determine whether an energy-efficient model is available in your area. It is possible to buy a dryer that is being discontinued and is not an energy-efficient model. As with any appliance, buying a more energy-efficient clothes washer or dryer can save money on energy costs over the long term.

Energy-efficient appliances use less energy to perform the same tasks as standard appliances. Energy savings is the most readily quantifiable result of using energy-efficient appliances. Replacing a fifteen-year-old refrigerator with a new, more efficient model could save as much as $60 a year in electricity costs. A more efficient refrigerator uses 40 percent less energy than a fifteen-year-old model. Depending on the age and efficiency of the appliance being replaced, upgrading to a more efficient model could save a significant amount on your bills. A handful of electric utility companies offer rebates to customers who purchase new, energy-efficient appliances. Often times, these offers are limited and based on a first-come, first-serve policy.

Smart Thermostats

Smart thermostats can save about $200 a year. They have the potential to be much more efficient because you can tell your heating or cooling system not to run when no one is home. However, the actual savings depends on you. The more you take advantage of the setback settings, the more you’ll save. Set the thermostat back 10 to 15 degrees when you’re asleep or away from home. The less efficient your house is, the more you’ll save, because a house loses less energy when the indoor temperature is close to the outdoor temperature. And those who live in milder climates will save more. Be aware that the ENERGY STAR program certified programmable thermostats that have the ability to save energy, but it hasn’t certified smart thermostats, which have shown much greater potential. Look for rebates or other incentives in your area. Due to the potentially large energy savings, some utility companies offer rebates.

Smart thermostats take a little effort to understand, but they can pay off big. They are designed to let you program in energy-saving set points and do so automatically without sacrificing comfort. For example, you can set the thermostat to reduce heating or cooling at night when you’re asleep or during the day when the house is unoccupied. Newer models offer much more flexibility – settings for each day of the week plus a vacation setting – and make it easy to override programming if your schedule changes.

Water Conservation

The most common leak is the WC cistern. There are two types of cistern: one has a ball float that rises with the water level, and the other has a cylinder float valve. With the float valve cistern, if the water level is higher than 25mm below the overflow level, the valve may need replacing. For the ball float cistern, if the arm has to be bent in order for the float to shut off the valve, then carefully bend the arm until the float is above the valve. If the float valve is old, it is best to replace it. If the leak continues after making these adjustments, it is likely that the valve seating washer needs replacing. This is achieved by turning off the water supply, flushing the cistern, unscrewing the valve, and removing the old washer.

Start by locating the water meter and recording the reading. Don’t use any water for a few hours, then take another reading. If no water has been used and the reading has changed, a leak is the cause. Leaking water is very costly and quite often the leaks are easy to fix. Usually, it is a simple washer replacement on a tap or the adjusting of the arm on the ball float. If this does not stop the leak, get in contact with a plumber. It may seem more expensive in the short term but could save a lot of money on a continuous leak.

Fixing Leaks

According to the water supplier, fixing leaks can save you 10% on your water bills. A leaking toilet can waste 400 litres a day and can be fixed with a new valve or by connecting the ball valve to the handle with string. Alternatively, the toilet might need a complete overhaul. Leaking taps are normally the result of a worn-out washer. Make sure you turn off the water supply at the valve underneath the sink. Then, the tap head needs to be removed by unscrewing or sometimes the screws are hidden under a decorative cap or sticker. Noting the order in which it was dismantled, the washer can then be removed and replaced with a compatible size. Finally, reassemble the tap. A fault on the mains system can go unnoticed for a long time. Reading your water meter and then 1 hour later taking another reading can indicate a leak. Following this, ensure no water is used over a 2-3 hour period (e.g. during the night) and take a third reading. If readings are inconsistent, the leak might be underground and specialist advice should be sought.

Water-Saving Devices

If large numbers of people use water-saving devices in their households, adequate savings at the national level could be achieved. Water-saving devices will be used to suggest products which can save water and do not reduce the convenience of using water. These products can be installed by householders themselves and do not require major changes in lifestyle. When promoting such devices, it is important to emphasize the cost-saving benefits to the consumer and not dwell on conservation for its own sake. Devices can be promoted at the point-of-sale in retail outlets, through plumbers and water utilities. White goods and appliances can be promoted through labeling schemes. Demonstration through displays and active programs have been found to be beneficial in raising consumer awareness and encouraging consumers to seek more information. It is also important to encourage consumers to maintain and ensure that devices are in good working order. Often the expected water savings are not achieved due to device deterioration and wear. This aspect can be promoted through after-sales service and consumer education programs.

Efficient Water Usage

An assessment of water efficiency in all sectors in the state of New York states that conservation in the public water supply sector represents a 26.6% reduction in water use between 1995 and 2010, with an increasing trend of efficiency over this time period. The study found that there is a price elasticity for water between -0.5 and -0.7 at the retail level, meaning that a 10% price increase or higher reduced consumption that much or even more. This means that in order to encourage efficiency, water cannot be priced cheaply. The price elasticity suggests that the demand for water is not inelastic (resistant to change), therefore high water prices can result in reduced water usage. This is an instance of a beneficial side effect because as water usage decreases, so does the quantity of wastewater, lessening the impact on water quality. This concept can be illustrated with a factor that underpins every water conservation policy: the less water that is used, the less water that needs to be treated and provided. This is cost effective and reduces the stress on both water supply and water quality.

Efficient water usage involves changing people’s habits in order to reduce their water usage, such as only using the dishwasher or washing machine when it is full, using a broom instead of a hose to clean driveways and sidewalks, keeping drinking water in the refrigerator instead of letting the tap run until it cools, and discouraging car washing unless it is necessary. Efficient water usage is important because it reduces the amount of water that needs to be treated and the size of the water treatment facility required.

Budgeting and Financial Tips

Negotiating service providers With the knowledge of how much the cost of living is for your family, and how much you will need to spend, you can plan to start saving money. One great way to do this is by price shopping your service providers. It may seem hard to find a better deal on utilities or telecommunications. But it is easier than you think. These companies are all vying for your business and it truly is a competitive market. Go online and find out the current deals available. See what other companies are offering and then call your provider and tell them you are thinking of changing to another company because you have found a cheaper rate. Often they will want to keep your business and will offer you a discounted rate or some added incentives. This, of course, will help you save money. Now all you have to do is find a better deal…and if you do switch companies, you will be completely amazed at how much money you can save by paying the same bills. Energy-saving grants and incentives.

Tracking expenses Provide yourself with information on where your money is going. This is a very important part of the tool and the more information you have on your spending habits, the more accurate the budgeting process will be. To do this, you will need to keep a record of all your expenses for a set period of time. Be sure to include everything such as household bills, groceries, and even those little trips to the coffee shop. Once you have done this, you can organize the recorded expenses into a list of categories. This will tell you exactly what you are spending your money on. With the information, you should then be able to make a budget that will reflect your current spending habits as well as your future goals. Remember to be honest with yourself when working out the figures. A budget is not a restrictive tool. It is a guideline tool used to be fully aware of the direction your money is moving in. A good budget will categorize your spending so you know where your money is going. This will enable you to make alterations that will increase your savings.

Tracking Expenses

An effective way to compare expenses is through the use of a regression chart on Microsoft Excel, or a similar function in budgeting software. This is a graph that will chart spending in a certain area over a period of time. If the trend is increasing, it becomes easier to see and may lead to addressing the problem of excessive spending in that area. A sample regression chart has been produced to show spending on unhealthy snacks. Note the increasing trend in spending, suggesting that consumption of unhealthy snacks has increased. This would be an example of money spent that is not a necessary requirement, and where spending can be cut to save money.

The next step is to analyze spending habits and determine areas where money can be saved. If categorizing, take a look at which areas the most money is being spent, and whether these are areas where less spending would be possible. For example, a person may spend $300 a month on food. In order to determine if this is excessive, there needs to be a comparison to similar spending by other people, or to past months when less money was spent. This comparison will dictate whether spending in that area is above or below necessary requirements.

Tracking expenses is a crucial part of managing an efficient budget. Done properly, it will give you an understanding of where your money is going, and where changes can be made to improve financial savings. There are a variety of methods available to track expenses. These range from simple pen and paper, to budgeting software that can produce visual graphs of your spending. For those with online banking, many banks offer a service to personal accounts that will keep track of your income and spending, and even categorize spending into areas such as food, entertainment, bills etc. Whichever method you choose, it’s important to input all spending into your method of choice, including cash spending which sometimes goes unaccounted for, by writing down all purchases in a small notebook for example.

Negotiating Service Providers

When families feel a budget pinch, they look for ways to cut costs. They should consider negotiations with service providers, something that many people don’t think about doing. It is not as hard as it seems and can result in substantial savings. For example, take the case of a family that is moving into a new home and wants to transfer their internet/phone/television service. By letting the service provider know that the new home is in an area with lots of choices for available service, it is possible to convince the provider to offer a better deal at the new location. Whether it is discounts on the same services or activation of a promotion that is under the current budget, a better deal is a real possibility if it convinces the family to stay with the same provider at the new location. Conversely, if the negotiation is unsuccessful and the provider refuses to make better offers, it may be worth considering the competition, as many new service promotions are for new customers only. Service promotions for new customers are also something to keep in mind. Service providers often have promotions for new customers that are substantially cheaper than the current cost of service. What most people don’t realize is that the promotion is usually just a few months of normal service pricing. When inquiring about promotions for new customers, it is possible to convince the provider to give the lower pricing permanently or for a probationary period. This tactic is easier if the customer has a history of timely bill payment and consistent service, something that establishments may be willing to give better deals in order to retain. With a probationary period, it is important to mark on a calendar when normal pricing will resume and to contact the provider to cancel/alter services if the price becomes unfavorable.

Energy-Saving Grants and Incentives

Independent organizations, as well as government agencies, often have several opportunities listed to promote energy conservation. Grants and incentives are available and can be attained by researching what is available for your region. A grants search can be done at environmentally focused organizations, government websites or at the library which may have literature for local programs. Tax credits may also apply to various energy efficiency investments so it is important to save documentation and receipts for home improvements. These tax credits and incentives often apply to purchasing of energy-saving appliances or renovations to a home. These can equate to large savings in the long run and can help offset the often higher price of greener products. In some cases, high efficiency appliances can pay for themselves with the savings accrued over a predetermined amount of time. High efficiency appliance rebates are also often available when purchasing Energy Star products. These rebates can be found through contacting utility companies or doing some research at local retailers. Often savings can apply to further installation and upgrades on home energy systems. It is important to know that credits, rebates and grant availability are subject to change so it may require some extra effort in staying informed and periodically checking the availability of these programs. All in all, there may be significant benefits from minor investments on research and a little bit of paperwork.