Yahoo Finance Cost of living crisis: Top tips to cut broadband and mobile bills
With providers hiking broadband and telephone prices by more than 9% in a further blow to millions of households, there are ways to reduce those costs amid a cost of living crisis.
From switching providers or haggling, taking advantage of perks on offer or ditching costly insurance, here are a few top tips from Which? on how to save hundreds of pounds on your broadband and mobile bills.
Switch provider and save £240
At the end of broadband and mobile phone contracts, switching providers is as an easy way to save money. New customers often get affordably priced introductory offers which can cost as much as 90% less than standard tariffs.
In some cases, switching could save hundreds per year. Which? research found that broadband customers who switch away from the ‘big four’ providers (BT, Sky, TalkTalk and Virgin Media) typically save several pounds on their annual broadband bill – as much as £190. Customers with a TV and broadband package can save even more – over £200. Switching mobile providers netted customers an average annual saving of £40. Customers leaving O2 and Three made the largest savings on average.
Haggle at the end of your contract and save up to £162
Providers often expect and invite haggling. The biggest potential savings are available to customers with a TV and broadband deal – when the consumer body surveyed customers who had haggled with their provider, it found the average saving was £128. Broadband customers who haggle save an average of £85 annually. Meanwhile, the average mobile customer saved £34 a year by haggling. Customers with the major providers saved even more: the average Three customers saved around £45 a year by haggling, and the average EE customer saved £75.
Think twice before taking out a mobile contract and save £288
While contracts allow customers to spread the expense, they often cost more in the long run and are sometimes subject to mid-contract price rises. For those who can afford to buy their phone outright, a low-cost Sim-only deal for the right amount of data you need can save money and help make future payments more predictable. Which? compared prices and found Three selling the iPhone 12 on a 24-month contract with 4GB of data at £42 per month, plus £29 upfront – £1,037 over the term. Purchasing an iPhone 12 outright for £629 with a rolling 30-day contract with Smarty for 4GB of data at £5 per month, could save £288 over the same period.
Look out for incentives from broadband providers and get £100 in vouchers
Many broadband and mobile providers offer incentives to entice new customers, typically vouchers and reward cards. Comparison sites often offer vouchers for checking broadband deals through them. Vouchers for £100 are also not that uncommon – and they are not only associated with the priciest deals. Researchers regularly spot £50 and £75 vouchers, often for use with Amazon, John Lewis, M&S, Sainsbury’s, Tesco and Uber Eats.
Don't overpay for mobile data
Premium phones are commonly sold on contracts with high data deals, but for those who aren’t heavy data users, most of that will go to waste. A low data contract such as 5GB of data from ID Mobile costs £6 a month, whereas 100GB of data from EE costs £34 a month. There are plenty of options between these extremes, such as 60GB of data from SMARTY for £10 a month.
Check your roaming charges
Travellers should ensure they know exactly what their provider will charge for using phone data abroad. Since Brexit, EE, Three and Vodafone have all introduced new charges for using data in Europe, whereas O2 has not. If travelling beyond Europe, the cost can vary dramatically between providers. For example, using data when roaming in the US varies dramatically. Plusnet charges £6 per MB, compared to just 20p per MB with Giffgaff, so users could potentially save £5.80 per MB by switching, according to Which?.
Be aware of price rises to avoid paying an extra £55 a year
Popular providers such as BT, EE, John Lewis Broadband, Plusnet, Shell Energy Broadband, TalkTalk and Vodafone all include price increases in their contracts. Usually, customers are given the right to exit a contract penalty-free if the provider announces a price hike, but if they are included in the terms and conditions of the contract that no longer applies. Customers within their minimum contract period will have little choice but to accept the price increase (or to pay a pricey exit fee to terminate the contract).
Read more: BT raises prices by £42 amid cost of living crisis
However, not every provider specifies price rises in contracts, Virgin Media and Sky stick to ad hoc price rises. Other providers such as Hyperoptic, SSE, Utility Warehouse and Zen Internet all commit to keeping their tariffs the same for the duration of a contract. When Which? looked at the average amounts affected customers pay, it found that this year's price increase would add as much as £55 to the average customer's annual broadband bill. Customers can avoid the extra cost by switching away or picking a provider with a fixed price.
See if you’re eligible for a social tariff and save a potential £204
Social tariffs help financially vulnerable customers afford their broadband and mobile costs. Customers on a means-tested benefit, such as Universal Credit, could be eligible. However, Ofcom found that out of around 4.2 million households that are eligible for social tariffs, only 55,000 have signed up so far.
Several broadband providers, including BT, Hyperoptic, Virgin Media, and most recently Now and Sky, offer them for customers who receive certain benefits. Vodafone has also recently expanded a social tariff plan for its Voxi mobile network to those receiving benefits, offering unlimited 5G data, calls and texts for £10 for up to six months.
While it doesn't offer a social tariff, TalkTalk partners with the Department for Work and Pensions to offer six months of free fibre broadband to certain jobseekers. However, this isn't available to all customers; eligibility is determined by Jobcentre staff so those on Universal Credit should ask their Jobcentre Plus work coach if they're eligible.
The typical standard broadband package costs £27 a month, but social tariffs are available for as little as £15 a month, meaning it’s possible to save a potential £144. Social tariffs for fibre broadband are also available for as little as £15 a month.
Take advantage of the extras on offer
Some broadband providers also offer mobile and energy deals and offer their customers discounts on other services. For example, EE, Virgin Media and Vodafone can offer discounted mobile phone deals, while SSE and Utility Warehouse often offer discounted broadband and energy bundles.
Read more: Vodafone and Sky launch social broadband tariffs for benefits claimants
The consumer body found other extras on offer from some providers that can also save money. Shell Energy Broadband gives customers access to its Shell Go+ programme, which includes 3% off 60 litres of fuel per month. Now Broadband offers discounted Now TV services and Virgin Media customers can access discounts via O2 Priority. The savings on offer vary depending on which benefits customers take advantage of. It could be a modest £1.05 for Virgin Media customers who take advantage of a free Greggs sausage roll, or £32 annually for those taking advantage of the discounted fuel on offer from Shell Energy Broadband.
Look outside the ‘big four’ mobile providers
The majority of mobile customers are with one of the ‘big four’ networks – EE, O2, Three and Vodafone. These providers are often at the more expensive end of the market, particularly for low data packages. To attract customers, virtual providers sometimes run deals on their packages which can mean extra savings. Opting for a smaller provider could save £240 in the first year. A 10GB Sim-only deal with EE costs £27 a month. Smarty offers 12GB of 5G data for £4 a month for the first three months, and £8 a month thereafter.
Refer a friend
Many broadband providers, including BT, Virgin Media and Vodafone offer bonuses if satisfied customers refer a friend. These usually come in the form of a gift card, but some providers offer bill credit or money off tariffs instead. For example, BT offers a £50 voucher to both parties.
Weigh up mobile phone insurance
Customers should weigh up the extras that are bundled into their mobile phone contract, as it could work out cheaper to buy them separately or not at all. Customers might already have contents insurance which may cover mobile phones through personal possessions cover. This protects your belongings whenever you leave your home and could even offer protection when you travel abroad. If their phone is covered by contents insurance, customers could save £120 per year on mobile insurance costing £10 per month.
Watch: How to save money on a low income
