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Getting a better deal on a low income - what’s stopping you?

Despite falling costs, energy, fuel, housing and food still take up the majority of our monthly spend. Haggling for a better deal or looking to switch can really help cut costs, but it seems families living on a lower income face barriers which can force them to pay a higher price.

The Social Market Foundation (SMF) looked at how the poorest sections of society fare when looking for a better deal, and found complicated bills, hidden charges and issues out of their control meant they often paid more than richer households on things like energy and broadband.

Switching deals is a turn off

Though looking for a better deal and then taking your business elsewhere if it’s cheaper are straightforward ways to save money, the SMF report found only 30% of lower income households had switched their phone, broadband or energy in the last two years - alot less than the 57% earning between £41,000 and £50,000 who have switched.

There was also a massive difference in how many people have used internet comparison sites. Just 39% earning under £14,000 had, half the number of the households with an income of more than £25,000.

It’s far more difficult to find the right deal without using a comparison sites, and with the report finding an average of 25% of a low income household’s monthly budget taken up with energy bills, it’s well worth seeing what can be saved.


Getting value harder to do

The fact that certain costs take up so much of a smaller salary means low income earners feel they aren’t getting as much value for money as higher earners.

Less than half surveyed thought internet services were good value and just 35% thought running a car was worth the costs. For higher earners those figures were both 49%.

But there are ways to get better value. Our own research showed haggling for a car could bring savings, with 64% of those who negotiated getting some money off.

It’s also worth seeing what discounts you can get from telephone, broadband and TV providers. Often threatening to leave can get you put through to a different team with extra savings to offer.

There are some areas where those on a lower income are able to get more bang for their buck. The survey revealed they get a lot better value from public transport and their food shopping.

What do you think?

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  • John Harwood / 22 March 2015

    I switched my energy supplier from Scottish Power to First Utility to great advantage saving well over £100 p.a.

  • Teresa / 19 March 2015

    I have saved money on my BT phone bill by recently switching to BT Basic.This is an option you can apply for if you are on an income based benefit,in my case JSA.They will initially try and dissuade you'you may not be unemployed for very long',the sales advisor told me but I have a degree and experience and this is not quite the I'm sure are others.!

    My quarterly bill works out about £25 less,also if you have broadband as part of the package it's £15 quarterly extra.Ypu can't play lots of games on this but if you are a light user; ie,use it for jobhunting and browsing it works out fine.
    BT will ask you for your NI number when applying,just to check your benefit status.

  • kevinscoot / 19 March 2015

    Very poor no money no jobs no food i need help to day


    ADMIN: Hi Kevin, unfortunately we do not provide individual advice on our blogs. You can contact an adviser on 0300 500 5000 or by using our webchat service.