BY JOHN ELLIS, FINANCIAL ADVISOR
As inflation eases and mortgage interest rates drop, 2025 brings a mixed bag for consumers. While new tax rules offer some relief, a slew of price hikes across energy, broadband, insurance, and groceries threatens to stretch household budgets. Here is a detailed look at what is rising and how you could reduce the impact.
Energy Costs are due to increase as the government’s plan to revert VAT on gas and electricity to 13.5% could add approximately €70 to the average annual electricity bill and €60 to gas costs. A further increase in the carbon tax in May will likely add another €20 to gas bills. Moreover, potential hikes in grid fees by the Commission for Regulation of Utilities (CRU) might prevent energy suppliers from reducing prices, even if wholesale costs decrease.
With potential annual savings of up to €791 by switching to a cheaper plan, now is the perfect time to shop around for better deals.
Since 2023, many telecom providers have applied inflation-based price increases into consumer’s broadband and mobile contracts. These automatic hikes, typically applied in April, could see bundled plans jump significantly again this year. Some plans rose by as much as €96 in 2024. If you are out of contract, switch to a cheaper broadband or mobile plan. Ensure the provider offers robust network coverage and unlimited 5G data if required.
Health insurance premiums have seen an 11% jump, pushing the average annual cost to €1,647due to healthcare inflation and rising claims costs, with some family plans increasing by €328 a year. So, when renewing your health insurance, look for more affordable options that still cover your family’s needs. Reviewing and switching policies can result in significant savings. Contact your insurer or the Health Insurance Authority (HIA) for guidance.
Car insurance premiums have risen by 11%, due to increased repair costs, claims, and uninsured drivers. The average annual premium now stands at €568. Shop around for multiple quotes when renewing your policy. If you find a cheaper option, ask your current provider to match it. Further savings can be achieved by paying annually, buying online, or adding an experienced named driver to your policy.
Our grocery bill is facing increased costs for essentials like milk, beef, butter, and eggs, with some items rising by up to 8%. Food inflation, driven by volatile weather and rising commodity prices, has hit 3% and is expected to peak at 3.2% mid-year. Reduce your grocery bill by switching to discounted supermarket chains, opting for own-brand labels, and take advantage of discount codes. These strategies could lower your weekly grocery bill from €195 to €117.
Eoin Clarke, of Switcher.ie, highlights the ongoing challenges: “Despite some relief from spiralling inflation in 2024, the cost of living remains high. Many households are struggling with the rising costs of energy, broadband, insurance, and groceries. However, by taking proactive steps—such as switching to cheaper energy and broadband plans, reviewing insurance policies, and making smarter grocery choices — families can alleviate some financial pressure and save hundreds of euros.”
As 2025 unfolds, stay informed as you review the challenges of your rising household expenses.
086 8362633
