Ofgem has confirmed the energy price cap will rise 10% in October to the equivalent of £1,717 per year for an average household.
“Energy bill rises will fuel another widening of the gulf between those who are emerging from the depths of the cost-of-living crisis, and the millions of people who are still trapped in the jaws of vicious living expenses,” said Sarah Coles, head of personal finance, Hargreaves Lansdown.
Coles continued to explain that data compiled by HL shows how the change in the price cap will understandably have the biggest impact on those with the lowest incomes.
“The HL Savings & Resilience Barometer shows that on average, half of us (49%) have enough cash left at the end of the month to be resilient, but among those on the lowest incomes this drops to zero,” Coles said.
“Even for those on middle incomes, almost two thirds don’t have enough spare cash. It means only above-average earners can comfortably weather the storm of this autumn’s price rises.”
For many, the change in price means a little less spare money for choosing premium options at M&S instead of Aldi, holding off buying their next pair of trainers from JD Sports or tightening the amount they can allocate to mortgage payments for a new home from Persimmon.
The price cap won’t have a dramatic impact for many. However, it does represent a slight tightening, just as households were looking forward to enjoying the impact of lower interest rates.