To Fix Or Not To Fix?

I don’t know about you but that bit of sun the other day fooled me. Now it’s bloody freezing again (Ok, not actually freezing but colder than I’d like and I have to wear some gloves while typing so I can get some feeling in my hands).

Hopefully it’ll be warmer soon, and it’s getting brighter every day, so it might be a weird time to be talking about fixing energy bills, but for many people it’s really important RIGHT NOW. If you were a top little money saver (well done you) and fixed a year or more ago, there’s a good chance that deal is coming to an end this weekend or at the end of April.

If that’s you, your bills are about to rise, possibly by over £200 a year. So what to do? And keep reading any of you on a “standard variable tariff”, as this is relevant to you too.

Why Fixing Is Good

For most people, fixing is going to be the best option. This means you commit to a contract where the energy is charged at a fixed price for a certain amount of time. It won’t go up (or down) if companies change their prices. If you don’t fix, you’ll be transferred to a variable tariff where rates can change at any time. For most providers this is also a more expensive tariff. So by fixing you’ll probably pay less and you’ll be protected from any rise during your contract.

Switching Isn’t Always Best

To get the best deal, you may also need to switch. This just means to change your provider. You don’t need to do anything yourself, there’s no new equipment. It can take a few months though to go through, and just by switching you don’t necessarily get the best deal. Your current provider might be best. It’s really about what tariff is best for you – and usually that’s through fixing.

You’re Going To Pay More Anyway

Now, for those of you with a fix about to end, even if you fix/switch again, your bills will still be more than you pay now. This is because even if fixed prices are cheaper than variable rates, they have still gone up since you last fixed. It just probably won’t be as much as if you were put on the variable tariff.

What About Really Long Fixes?

A big question on fixing is how long for. There are some really long fixes our there, but you pay more per unit of energy, and therefore have higher bills. However, if prices continue to rise each year, you might actually be paying less after a few years. It’s impossible to say what to do here as I don’t know how prices will change. You just need to decide whether you’d prefer the risk of possibly paying too much, or the risk of continuing high price rises.

So how do you sort this? Don’t be scared. It’s really easy and can be done in 15 minutes. Just read our handy 7 Steps To Cheaper Energy guide. I switched (and fixed) from an EDF tariff at Christmas, and I’m now with NPower. The comparison site estimated I’d save roughly £65 a year over a variable tariff with EDF, plus I got £30 cashback, so I should be up nearly £95.