New data analysed by Opinium has discovered that the recent energy price cap rise is affecting the finances of the younger generation more than any other.
Its research found that 18-34 year olds are the most likely to be cutting back on putting money into their savings (23%), investments (14%) and pensions (13%) in order to mitigate soaring energy prices.
When asked what an increase in energy bills of £700 per year would mean for them, a third (32%) said they wouldn’t be able to heat their home any more, 18 per cent said they wouldn’t be able to afford their rent, 14 per cent said they wouldn’t be able to make their mortgage payments and 16 per cent said they wouldn’t be able to afford their childcare - all higher than any other age group.
Almost half (47%) of 18-34 year olds have said they are concerned about how they will cope financially if Ofgem raises the energy price cap again in October.
Commenting on the findings, Alexa Nightingale, Head of Financial Services research at Opinium, said: “The record increase to the energy price cap that came in earlier this month comes at a time when consumers’ finances are being squeezed from all angles. With the general cost of living rising, and interest rates and inflation soaring too, many people in the UK will be feeling out of pocket.
“Our survey of 2,000 adults across the UK shows that it’s the younger generations who are going to be hit the hardest, but worryingly are the least likely to know about the rise in energy prices.”
She added: “It is likely that for many the UK Government’s Energy Bills Rebate, due in the autumn, will not go far enough, and it’s no surprise that people are already taking steps to mitigate upcoming rising costs. Some of these findings highlight the concerning reality people may be facing as a result of this price hike - such as not being able to cover their rent or mortgage costs, and in some cases not being able to heat their homes at all.”
Three ways to reduce energy bills in warmer weather
Make most of the sunshine
Rather than using a tumble dryer, dry your clothes on the washing line the old-fashioned way. If you stopped using a tumble dryer altogether, you would save around £70 a year.
Manage your fridge
According to the Energy Savings Trust, a fridge costs as much as seven per cent of your energy bill, around £60 per year - before the price cap hike.
Fridges run much more efficiently when they aren’t empty, so if it’s more than 50 per cent empty, fill some of the space with jugs of water. But don’t overfill, as the fridge does need some space and air for it to run at an optimum level.
And check the fridge temperature - refrigerators and freezers set just a few degrees lower can cut down on energy use by as much as 25 per cent. The ideal temperature for a fridge is between 3 and 5 degrees. Freezers should be set at -18 degrees.
Use a timer on your lights
Many holidaymakers decide to leave the lights on while they are away to scare off intruders. A better way that will reduce your energy use, is to buy a timer switch. These plugs straight into the wall cost as little as £5 and many allow you to programme in several time slots. At the same time, use energy-saving lightbulbs that save up to 20 per cent on lighting costs.
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