A SIMPLE change to how your buy your home broadband could save you hundreds of pounds every year.
Most broadband contracts run out after 12 to 24 months – at this point you've got three choices: renew, find a new provider, or do nothing.
And according to research carried out by Ofcom, around 35% of the 7.4 million broadband customers in the UK, opt to do nothing when their contract expires.
Instead, they stay loyal and carry on paying their current broadband provider, each month as an out-of-contract customer – but this could be a costly mistake.
After your deal ends, the price typically goes up, and you could be forking out much more than you need to – Ofcom calls this the “loyalty penalty.”
But Alex Tofts, broadband expert at Broadband Genie, reveals how you can avoid it.
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Alex said: “Broadband customers who stay on after their contract end up paying an average loyalty penalty of £61 a year.
"For those who are happy to shop around and switch providers, the savings are usually much higher. Often households save hundreds by switching."
Despite this advice, around 7 million UK households are still losing out.
Instead of switching and taking advantage of the competitive introductory deals, they watch their broadband bills increase year after year.
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Alex has eight simple tips on how to secure fast broadband for a low price.
1. Remind yourself to shop around for the best deal
The first tip is an incredibly simple one.
Alex said: "Most people do not leave themselves enough time to shop around for the best broadband deal.
"If everyone put a note in their calendar for a few weeks before the date their broadband contract was due to expire, UK households would save hundreds."
2. Familiarise yourself with the broadband deals that are available to you
In the weeks before your contract is up, use comparison sites to familiarise yourself with what deals are available, said Alex.
Broadband Genie, MoneySuperMarket and Uswitch all help you customise your search based on price, speed and provider.
This should make it easier to decide whether to renew your contract or move to another provider.
3. New customers get the best deals
Alex said: "Broadband providers are always keen to give out the best rates to new customers to reel you in.
"Unfortunately, being loyal doesn’t give you the best rates on the market."
For the best rates, Alex recommends that you switch providers to become a new customer.
New sign-up offers currently include a £110 pre-paid Mastercard (BT), £50 bill credit (Shell) and no set-up costs (Sky).
4. You don´t have to switch to save
If you’re happy with your current provider, you can still make significant savings by renewing rather than rolling on to the tariff you're given after your deal.
Alex said: "Most of the time, if you cancel your subscription just before your notice period is up, your provider will contact you to offer you a better deal.
"You don’t even need to get on the phone; most providers are happy to renegotiate terms via live chat, email, or social media."
You could save up to £210 a year on your bills by haggling alone.
5. Save big with broadband bundles
Broadband deals that bundle the internet with other services like TV packages, home phone, and mobile phone plans are a terrific way to save money.
Another perk of these deals is that you just have one monthly payment to make each month, which can be easier than managing multiple bills.
But Alex said these packages are only worth considering if you're sure that you'll use all parts of the bundle.
6. Look out for free gifts – some are worth £100s
Competition for broadband customers is intense. So, providers frequently offer free gifts like Amazon vouchers, prepaid credit cards, and bill credits to encourage you to sign up.
Alex said: "Just make sure the reward offers you real value — a shopping voucher for a store you don’t use isn’t much help.
"Also, remember that freebies often require you to claim them and come with an expiry date."
The average incentive value is around £100.
7. You might not need a super-fast connection?
Faster broadband usually costs more, but depending on your usage, you might not need the fastest service available.
Alex said: "If you’re happy with the speed you are already getting, target this level for your next broadband deal.
"To find out what speed suits you, run a broadband speed test to see what you’re currently getting."
It's also important to recognise if your household dynamic has changed, for example, if your kids have left home. If so there's a possibility that you no longer need such a fast connection.
8. Sign up for cheaper social tariffs – save £240 per year
Investigate social tariffs. These broadband packages and discounts have been created for people who are receiving certain benefits.
They're often available to those on income support, universal credit, or disability allowance.
Alex said: "Around 4.2 million households are eligible for cheaper social tariffs, but only 55,000 are making use of these low-cost tariffs.
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"This means that almost 90% of households eligible for social tariffs haven’t signed up for them and are missing out on a potential saving of £240 per year."
Prices start from £12.50 a month.
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