Tuesday, January 25, 2022

FIX THIS Martin Lewis explains whether you should fix your energy bills now, before £600 soar

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MARTIN Lewis has explained whether or not you should correct your gas and electricity bills as millions of people face higher energy prices.

 

Experts warn energy bills could rise by 51% in April, adding up to £600 to annual costs.

 

Budget-busting hikes have already hit many households as the cost of wholesale gas has skyrocketed this winter.

 

A price cap set by energy regulator Ofgem caps average charges for gas and electricity.

 

The current price cap of £1,277 is reviewed twice a year and the next increase is in April.

 

Fixed offers used to be cheaper than the price cap but are now more expensive, with an average now of £2,391.

 

With an expected 51% increase, the typical under-cap bill could rise to £1,925 a year from April 1.

 

Many bill payers are asking Martin if they should lift the price cap now and fix their bill with deals available now, he said in his weekly newsletter.

 

The money-saving expert said: “After the number crunching, it’s still a ‘no’ for most, but for the first time in many months, it could be worth fixing for some.”

 

“If you’re being offered a solution that’s no more than 40% more expensive than your current capped plan, that’s worth considering – especially if you value budget security.”

 

Most currently available fixed offers are about 56% above the cap, so it’s probably not worth committing unless you have very high or low usage, he explains.

 

However, some deals for existing energy company customers might be better than the deals for everyone.

 

“If you’re offered one, look at the numbers to see what percentage the raise is,” Martin said.

 

But there’s a risk that if you fix now and prices drop, you could be locked into a deal that costs more.

 

On the other hand, if prices go up, you’ve locked in the cheaper price.

 

It’s a complex situation, Martin acknowledged, and energy customers can get confused.

 

In short, he said: “It looks like most people shouldn’t do anything (no certainty, I don’t have a crystal ball), it looks like only a few edge cases should be looking for a solution at the moment.

 

“So when in doubt, just stick to today’s cheapest price – that’s the upper limit. And to be clear, the 40% figure is my best guess, not fixed.”

 

Martin also explained how to check in on his ITV program The Martin Lewis Money Show which you can watch below.

 

The 40% number is based on certain assumptions, such as the calculations used to calculate the cap, which remain the same.

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