British households have underestimated their main household bills – council tax, gas and electricity – by an average of £467 in the past year, according to new research from Santander Current Accounts.
The analysis suggests that the millions of households struggling to cover their household bills due to spiralling prices are compounding the issue because they are out of touch with current utility costs.
Santander asked bill payers to estimate their annual spend on their main household bills and found respondents under-estimated some by as much as £672. While they significantly underestimated the amount they pay for council tax, gas and electricity, they over-estimated their expenditure on water and TV/phone/broadband bills.
The survey also highlights financial problems experienced by some households when it comes to paying bills.
When questioned, 11% of bill payers said they were unable to afford monthly bills and a further 44% said they were “only just” able to cover them
Additionally, the research has found that relatively low numbers of people surveyed said they plan ahead or prepare for bills.
One in three bill payers (33%) said they set money aside every month for bills, and only one in seven (15%) people said they have a separate bank account specifically for bills.
Matt Hall, Director of Banking at Santander, said: “Household bills have risen significantly in recent years. With household income not growing as fast, many families are struggling. While almost all households are making efforts to manage their energy consumption, people could manage their household bills more efficiently by providing their supplier with regular meter readings and checking statements thoroughly.”
One reason why estimated and actual bill spend differs may be a lack of attention to bill statements.
More than a quarter (26%) of bill payers admit they do not read their statements properly, while 3% – equivalent to 800,000 UK households – do not even open their statements.
The research also highlights that many bill payers are not communicating with their energy suppliers, as almost a quarter (23%) said they had never supplied a meter reading or couldn’t remember the last time they gave one for either their gas and/or electricity.
Coincidentally, the research has found that 46% of households have had a dispute with their supplier in the past. The most common reason for disputes is customers feeling they had been charged incorrectly.
The findings also indicate that almost all (95%) UK households are now taking proactive steps to reduce their consumption and consequently, their monthly bills.
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