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Sadly when it comes to staying loyal to an ISP, customers are too often rewarded with overpayment. We cast a frugal eye over why and how you can make savings instead.
Nobody likes to pay more than they need to, for anything in life. The bill for modern utilities is only rising and for most people keen to budget, every penny or pound needs to count.
Broadband products, much like our mobile phones, are an increasingly essential expense here with most subject to fixed-term contracts. As a result, such services are slightly unique in the way they can find us overpaying by considerable amounts.
In this guide, we will examine how and why this can occur, before identifying several popular strategies for cutting unnecessary costs.
So what is the leading cause for this overpayment?
Typically and most directly, it can be attributed to a failure to recognise and observe the expiry of a minimum contract period.
According to Ofcom figures from May 2019, more than 20 million UK customers were past their minimum contract term for a variety of contractual services. These would span phone and subscription TV, but more crucially a staggering 8.8 million broadband consumers possibly paying over the odds.
After a contract ends, rolling terms then kick in for the foreseeable ongoing basis, but often at a higher cost.
At this time the customer is fundamentally free to “shop around” for a cheaper option, switch vendors or indeed negotiate a better deal with the current provider.
However, many of us fail to take advantage of this opportunity.
The irony here is that such potential overpayment for broadband can be seen as a penalty for showing loyalty to a provider. “Why do I keep seeing incentive deals for new customers and nothing for loyal ‘ol me?”
If you find yourself asking those sorts of questions after passing current contract terms, then you could be in the driving seat. With Ofcom figures also asserting that average savings could be as much as £100 per year, don’t underestimate the value in politely challenging your existing provider first.
You might have a special relationship with a broadband company you trust. In all other ways they deliver good service, so while you want to stay they want to keep you.
To start with, never underestimate the effectiveness of haggling.
Speaking to your current provider, over the phone preferably, is a must-try tactic when trying to secure a cheaper deal.
However, you don’t want to go into a conversation uniformed. Not only should you know and be able to recite what you currently pay, but also versus what you could be paying if you switched to a cheaper provider. Do some price comparisons with rival providers, find those that undercut your current deal and use that information to haggle.
Remember that cheaper broadband is like anything in life, you don’t get if you don’t ask!
Often the assertion you plan to leave a provider is enough to secure an improved, cheaper deal to keep you.
While it’s true you will be asked to sign a new contract subject to new minimum terms, if you’re happy then great!
However, sometimes staying loyal can’t match a better offer elsewhere and switching providers is the way forward. If you had experienced difficulties or dissatisfaction with a current provider previously, then being out of contract is the ideal chance to swap.
Broadband price comparison websites such as Broadband Genie are ideal for shopping around and starting the switching process. Just be sure to not only compare price but all the equivalent package specs and indeed any setup or installation costs to factor in.
One of the more popular ways that broadband providers like BT, Sky and Virgin market services more “cheaply” is with bundles.
These packages tie fast fibre-based internet to on-demand TV and telephony products to consolidate your bills. You can read more about fibre broadband here.
While on the surface this bundling may seem more cost-effective, generally this is true, it depends on your needs. A good tip is to think about your usage habits now and not be coerced into adding unwanted extras under the perception a more expensive bundle is better value.
Bundles can also tend to offer free rewards for new customer signups, which is another bonus worth considering.
Everybody loves the carrot of vouchers and freebies. The leading broadband providers know this and regularly entice with various promotional partnerships, Amazon gift cards and the like.
Often these can be persuasive and if they make a material practical difference in your existing spending habits, worth considering towards potential savings.
For instance, a £100 spending voucher with a retailer you already shop with could be enough to effectively constitute three months of free broadband at £33 per month.
Additionally, some service packages pass on limited-term discounts or the waving of setup fees. Look at these carefully and remember to think about where prices leap to after the discount expires, while also factoring in all deals and “freebies” when comparing deals.
As people borrow money based on the information found on this website, we understand the importance of making the most of your money and getting the very best value. We hope you found the post useful?