Are you feeling the pinch with your day-to-day costs? It seems that unfortunately this is now the norm. Our new Billflation Index has shown that household bills have risen at over double the rate of inflation in the last year. We’ve taken into account the monthly cost of housing, energy, motor insurance, home insurance, petrol and utilities – costs that affect the majority of you. 

Sky-high spending

The key finding from this first index is that the average monthly cost of household bills rose by 5.7% to £845 in April 2017 compared to April 2016 – more than double the rate of inflation, which came out at an annualised rise of 2.6% (April 2017). This highlights the real pressure that many of you are under when it comes to paying your regular bills. The current climate is also doing nothing to help this, as can be seen by our Uncertainty Calculator.

Hikes in housing

The main cost contributing to the rise is increasing mortgage and rental payments. The average monthly housing payment, which includes mortgage repayments, private and social housing rent, rose by £23 over the past year. This is mainly down to continued house price growth meaning that many of you are having to take larger mortgages, leading to higher monthly repayments. However, as interest rates are at record lows, as the cost of servicing a mortgage is also extremely low. There’s an opportunity for mortgage holders on a standard variable rate to reduce their payments by remortgaging to one of the historically low fixed interest rates before the Bank of England raises rates. 

Dear driving

As can be seen in our quarterly Premium Drivers Report, car insurance has also reached record levels over the last year. The average monthly motor insurance premium has risen by almost 6% to £94. There are a number of reasons for this significant increase including the government hikes in Insurance Premium Tax, increasing whiplash claims and changes to the way in which personal injury compensation payments are calculated. But insurance isn’t the only cost for drivers who are also facing the rise in the price of petrol by 10% to £100 per month. The Insurance Premium Tax hikes have also forced the cost of home insurance up by 8.2%, to an average of £61 per month.

Billflation; petrol prices increased
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Simon McCulloch


“These figures highlight the real pressure that households are under. Increases in the cost of housing, energy and driving, all staple costs for most people, have certainly been felt as costs continue to outstrip wage growth. However, there is hope for those facing these seemingly endless cost rises. Over the past few years, there has been a big shift in consumers becoming savvier with their grocery shopping and hunting out the best deals and they should really apply the same approach to household bills. By taking the time to search for better deals on energy, insurance and other costs, they could save hundreds of pounds. All of these providers to a greater or lesser extent rely on customer inertia to keep prices and rates high. Only action can keep prices in check!”

So what are you waiting for – get comparing now and see if you can ease the pressure on your pocket.

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