Heating Bills Are Expected to Jump This Winter. Here's How to Save Money

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  • This winter is forecasted to be colder than usual across much of the country.
  • The cost of fuel for heating homes may rise as supply is expected to go down.
  • Taking steps like adjusting your thermostat and budgeting for higher costs can help keep your heating bills manageable.

Don't let your heating bill burn a hole in your bank account.

As a native Californian now living in the Midwest, it's fair to say that I am very aware of the cold weather months approaching. As beautiful as fall can be, no amount of leaf-peeping photos in my camera roll can soften the blow when the temperatures plummet and suddenly my face hurts when I go outside. And unfortunately, that's not the only thing that can hurt about winter.

Many people, especially those living in colder climates, see their utility bills go up in the winter as they crank the heat in response to the temperatures outside. And this year's bills could be even higher than usual, thanks to a combination of factors.

Why heating costs may increase

Experts are predicting a relatively colder winter across much of the United States this year. That will lead to many households using more fuel -- whether natural gas, electricity, or another source -- to keep their homes comfortable throughout the season.

At the same time, the cost of those fuels, particularly natural gas, is expected to rise. That's due in part to Russia's invasion of Ukraine, which has disrupted a major source of the world's natural gas production. Another reason is because OPEC (The Organization of the Petroleum Exporting Countries) recently released its predictions for oil demand in the year's fourth quarter. It is forecasting a softening demand thanks to slowing economic growth, and announced an expectation to reduce production. And per basic economic theory, a lower supply of something generally leads to increased prices.

This combination of higher fuel prices and a colder winter are pointing to an expected spike of up to 28% on many Americans' heating bills. And at a time when inflation is wreaking havoc on many people's finances already, that can be a real blow. While there may not be a way to avoid that increase entirely, there are some factors you can control to take some of the sting off.

Tips to cope with higher heating bills

I used to have a roommate who would wear shorts and a tank top around the apartment and crank the heat to 80 degrees because she "was cold." Don't be like her. While we all probably have a preference for the most comfortable temperature when we're at home, see if you can lower your thermostat by a few degrees. You can even start by lowering it gradually each week, so you can get used to the change. If you normally like your home to be 73 degrees, see if you can work your way down to 68 degrees. Experts say you can shave off about 1% of your heating bill for every degree you lower your thermostat, so that's a 5% drop in your heating bill right there.

Layered clothing is your friend in the winter, so cozy up in a sweater and fuzzy socks if you feel cold, rather than raising the heat. And throw in a couple of jumping jacks or up-downs while you're at it. Getting your blood pumping can quickly take you from chilly to comfy with little effort -- and no cost.

Back to your thermostat. If you have a programmable one, look into setting a schedule where the temperature is lower while you're out of the house and while you're sleeping. Cutting back the hours you keep your home at a top temperature should make a noticeable dent in your heating bill. Or if you work from home, do what I do: Keep the thermostat set lower during the day, and use a space heater for the room you spend the most time in. I find there's no need to heat the whole house for the eight hours I'm working if I'm spending 90% of it in my office. I might turn the space heater on for a few minutes every hour, and things stay toasty enough with the door closed.

Each of these tips will help, but you're unlikely to avoid higher heating bills entirely this winter. That makes it even more important than usual to budget ahead of time for the increased costs. Make sure you have enough in your emergency savings to cover bills that are higher than usual, and see if there are places you can cut back over the next few months. Maybe you can host friends for a potluck meal rather than going out to restaurants as often. Or you could pause your online shopping habit for a little while if there aren't any essential items you need to buy. You could even go big and try a no-spend week to see how much you could save.

Don't let winter bills lead to winter blues

Winter can be a beautiful season with a lot of outdoor fun and indoor coziness, but it can also be expensive. Take steps now to prepare for what might be a pricier winter than normal so your bank account can be in as great of shape as your snowmen when the temperatures drop.

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