ISA savings hindered by energy bills

Friday, 20 April 2012 9:32 AM

Many households are facing higher energy bills than this time last year, despite one of the mildest winters in almost a decade.

Research from Consumer Focus suggests that higher energy prices has left households with an unexpected price hike, which could mean those looking to save money into ISA accounts now, in order take advantage of the best rates, are having to wait until their bills are paid.

The research suggests that a fall in energy consumption has not been mirrored by a fall in the cost of energy as the energy price cuts did not take effect until late winter; this has seen households see bills as high as £180 more than the same time last year.

The turn of the tax year has brought with it a plethora of bonus and introductory rates that could help savers make the most of their money. In some cases, ISA rates as high as 5 per cent have been offered. However, savers looking to make the most of their full ISA allowance may be hindered as the priority of paying for an energy bill comes first. The research suggests that households are already cutting back on nights out with family and friends, paying for music and in some cases the weekly food budget.

Mike O’Connor, chief executive of Consumer Focus that in some cases rises in bills will be at prices some customers ‘simply can’t afford’.

“With energy price cuts and less heating used because of the mild weather, most people will have expected their winter energy bill to be lower this year”, he added.

This year’s ISA allowance is £5,640 and savers have until 5 April 2013 to take advantage of it.

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