We know too well that the pressure of increasing household expenses can be overwhelming for young families. Add to this a renovation or new build and the task of keeping up with the bills can feel like a real juggling act. Sitting down and planning the finances as a family is always useful, but sometimes the bills are just more than you'd budgeted for. For this reason, we were interested in hearing more about EnergyAustralia's new Secure Saver product, which offers consumers the opportunity to lock-in their current energy price until 2019.
So to tell us more, we sat down with finance expert, Melissa Browne to get the low-down on how you and your family can benefit. To say that Melissa is skilled at educating people on their finances is an understatement. Melissa is the founder and CEO of an award-winning accounting firm, co-founder of financial planning business 'The Money Barre' and has authored three business and finance books; 'More Money For Shoes', 'Fabulous But Broke' and 'Unf*ck Your Finances'. In addition to all this, she writes a fortnightly money column for Fairfax and in 2016 was listed as one of the Financial Review's 100 Women of Influence. When it comes to your finances, Melissa is one you certainly want to listen to!
We've seen a substantial increase in energy costs over the last decade, are you able to explain why?
There's no simple answer as to why energy costs have increased so dramatically, but there are a whole host of factors that have come into play. These include rising gas prices which is driving up prices for electricity; the closure of coal fired power stations - which has placed more demand on other sources of stable supply such as gas. What we know is that energy prices have risen and it's important that consumers understand they can do something about it, even if they feel like they can't. This includes everything from locking in rates, using comparison sites to check they're receiving a great deal and being savvy every day about reducing their household energy consumption.
EnergyAustralia is set to launch a new Secure Saver product, can you tell us the key features?
This product by EnergyAustralia helps in some way to combat the uncertainty and concern that many households feel when it comes to rising electricity prices. It's a two year, fixed rate contract available until 31 January 2018 for consumers to sign up. New and existing customers who sign up for Secure Saver will be able to fix the current price of their gas and electricity with EnergyAustralia (ahead of the January 1 Victorian increase). The part of the scheme I really like is that unlike a fixed rate mortgage contract where if interest rates drop you don't benefit, with the Secure Saver product if energy costs drop, locking into this plan doesn't prevent you from receiving the drop in prices too. So, it's a lock-in to the existing rate AND the ability to benefit from a decrease in price, which is a great win-win for households.
As a young family, how will it benefit us to lock-in our current energy price?
When I work with young families it's often with a limited budget, increased costs and often decreased income. That's because often one partner stops working for a while and there's all the extra costs that young children bring. What I usually see is that young families are too time-poor to shop around and do something about their finances. This product by EnergyAustralia allows you to easily do something to provide certainty around increased costs when it comes to energy in the home.
Who is the new product available to?
The good news is that it's available to both new and existing EnergyAustralia customers.
If we choose to use the Secure Saver, when do we need to lock in our rate by?
If you want to take advantage of the scheme you need to lock in your rate by 31 January 2018. For Victorians specifically, ideally before the rate rise on 1 January 2018.
We often get a surprise when we receive our power bills - are there ways we could regulate our power usage as we go?
There are so many things you can do to regulate your power usage. If I did a quick whip around most family homes I'd see so many appliances turned on, lights turned on and lazy leakages of electricity. Instead, make sure you turn your appliances off when you're not using them, power off TVs and computers instead of leaving them on standby, get rid of your bar fridge that you only use at Christmas time anyway and stop daydreaming in the shower which turns three minutes to fifteen.
Can you share your top 3 tips for reducing our household's energy consumption?
My advice is to not do this once and then stop but rather create a great habit of looking for energy wastage as a household. Three big places to start are:
- Your appliances. There are loads of things you can do here to save costs. Firstly, it's understanding the energy rating when you buy the
product, so you're choosing the most energy efficient products available and understanding there is an enormous difference between some appliances.
Secondly, it's getting rid of appliances that you use occasionally such as the bar fridge that you only use twice a year. Grab a couple
of eskies and fill them up with ice instead. Finally, it's unplugging your appliances when they're not in use. That's because most
TV's, computers, microwaves and even some washing machines have a 'standby' mode which means they're still using energy even when they're not in
use, which is a sneaky use of electricity consumption you're probably not aware of.
- In Victoria, you have actual seasons, which means heating and cooling bills are going to affect your energy bills. I'm certainly not suggesting
you don't use air conditioners and heaters, but use them wisely. For example, during hot summer days make sure you pull your window blinds
down to help keep the heat out and on cold nights close the curtains to keep the heat in. Turn your air conditioner on early on hot days
with a higher temperature (25 degrees is usually adequate) rather than waiting until your home is already hot and blasting it at an icy temperature
for hours. Each 1 degree celsius will save about 10% on your energy usage. During workdays you might have your air conditioner programmed
to help with the extremes. Instead, consider alternatives such as ceiling fans which are far cheaper than air conditioning and have less
- Although it feels good to stand under the shower after a tough day, heating your water can be an expensive part of your energy consumption. Consider limiting your shower times, buy a water-efficient shower head and consider collecting rainwater for watering your garden by installing a rainwater tank or by using the recycled water from your shower, laundry tubs and washing machines.
Of course, you might also consider alternative green forms of energy such as solar panels which will help reduce your overall costs.
What are 2 things you would do with the money you save on your energy bills?
It depends on your financial situation. If you own a home, pop the savings onto your mortgage. If you save $50 per month and you transferred that onto your home loan each month (where you're being charged 5% interest) you would save $13,856.10 in interest over the life of your loan.
Alternatively, you can look into investments.
How can I find out more?