Utility Finances: Establishing a Balanced Payable Budget
With falling commodity and energy prices, budgeting for utility finances is becoming increasingly difficult. Utility companies are tightening their belts and passing on ever-faster increases in rates to households. Utility managers often take advantage of vulnerable customers by drastically increasing their prices, or by taking advantage of their lack of knowledge about budgeting and other important household services. This practice often referred to as rate taking, is illegal in most states. But, the result is that families are left with very few alternative options for budgeting for utilities.
Unfortunately, many families simply cannot deal
with the increased cost of utilities. In these instances, there are some very simple steps that utility managers can take to alleviate the stress of their budget. When faced with rising costs, it is usually easy to fall back on a utility manager or an experienced contractor to help devise utility budgets that will help keep a household’s financial situation afloat. However, if a family wants to take back control of their finances and take back the power they have traditionally had over their utility bills, it is important to be aware of their options.
Utility budgets can come in many forms.
For families with single-stream, unpredictable electricity, there are often utility manager programs that can help them establish reasonable fixed monthly budgets. These programs can also help families in other situations where they are unable to predict their future electrical use. For example, a family might decide to move into an older home and pay more for the electricity than they were used to in the new home. In this case, developing a utility budget designed for the aging population may be the best option.
Many utility managers offer their services
to households on a contingency basis, meaning that they only pay if and when a customer can pay. This means that a utility manager may come into a household on a weekly or bi-weekly basis to review and update the household’s accounts. In many cases, utility managers will work with a household to develop an affordable monthly payment plan that incorporates the projected number of users. Once a utility manager can develop a reasonable plan, the utility manager will make sure that the household can pay its projected charges on time.
If a household does not develop an alternate budget
that helps to keep their utility expenses from going over the amount they can reasonably afford each month, then the utility manager will make recommendations for reducing the household’s usage. The utility manager may suggest moving to a lower consumption rate, reducing electrical accessories, or even changing appliances that use a higher amount of electricity. In most cases, a utility manager will only recommend these solutions if the household has tried to reduce its usage without success. In this way, a utility manager helps to keep utility finances in check.
If a utility finance charge
is high and the utility bills are continuously high, then it is sometimes necessary to contact a financial consultant. Many consumer financial consultants can help individuals and families in establishing sensible utility budgets. These consultants can help an individual or family to develop a realistic utility budget that meets the household’s needs and reduces their utility expenses. This professional advice can be extremely helpful in helping an individual or family to establish a realistic utility budget and in preventing future increases in the household’s utility bills. For more information regarding affordable utility financing, contact your local consumer credit counseling service.