This Simple Move Could Save You a Fortune on Utilities This Winter

I made this move a few years back, and I haven't regretted it.

I'll be honest: Winter is not my favorite season. As someone who gets cold easily, living in a place that has snow on the ground about five months out of the year isn't always easy. Though I've grown to enjoy winter outdoor activities a little more as I've gotten older, I still spend most of my winters inside with good books and lots of blankets.

But that raises another problem. Keeping myself warm brings sky-high utility costs -- or at least it used to. But then I learned a trick to stop my bills from sucker-punching my bank account right in the middle of the holiday season.

It only takes a few minutes to do

The biggest problem with utility bills is that they fluctuate based on your usage. So one month's costs might be higher or lower than the next, but you won't really know for sure until you get the bill. That's a huge problem for those on a tight budget.

You can try to keep costs down by lowering your thermostat, turning out lights, and doing other things to reduce your costs. But even then, you'll probably face higher bills in the winter since you're paying every day to heat your house.

If you want a predictable payment, switching to budget billing could be a smart move. This is where the utility company estimates your usage for the entire year based on your usage history. If you haven't lived in the house for a full year, it relies on data from the previous owner's usage history to start. Then, it evenly divides the cost between each of the 12 months so you get a regular monthly payment.

To be clear, this doesn't reduce how much you owe. You'll pay more in the summer as a result of paying less in the winter. But it's much easier to plan for in your budget.

A few caveats

Most utility companies that offer budget billing recalculate your monthly bill amount at least once per year to ensure they reflect your actual usage. If you've used more electricity and gas than expected, you could have a lump sum to pay at the end of the year, and you may see your monthly bills jump considerably. But if your usage is lower than expected, your bills could also drop over time.

In addition, some companies charge administration fees to set up budget billing for customers. If you're considering this, it's a good idea to inquire whether there are any charges associated with its budget billing program before you sign up.

Finally, when your monthly bill doesn't reflect your usage from the previous month, you might be more likely to lose track of how much you're actually using. This could lull you into turning the heat up higher or using more electricity, and you may not realize the consequences of your actions until the company reevaluates your budget billing amount for the next year.

How to get started

If your utility company offers budget billing, all you have to do is call and ask, or look on its website if you pay your bill online. It may take a month or so until the change takes effect, which is why it's best to do this soon if you're trying to avoid high bills in the winter.

But remember, this strategy isn't going to reduce how much you owe overall. It just changes when you pay for it. If you want to reduce how much you owe, you also have to take steps to reduce your usage throughout the year.