It could be time for you to switch over

Christmas is out of the way, UK PLC is back at work and most of us have already broken our New Year Resolutions.

But there is one small piece of good news. A little bit of competition is stirring amongst some of our financial and energy suppliers.

Banks, for example, are starting to look to their laurels as new brands such as Virgin Money enter the market and existing brands such as the Co-op buy more branches.

In the last few months, we have seen banks offering cash inducements of up to £200 to new customers as well as a plethora of other offers such as good rates of interest on current accounts, free overdrafts and so on.

Given how loathe banks are to lose customers, you can be reasonably confident that big names like Barclays and RBS will be offering their own inducements.

Over in the energy markets, meanwhile, British Gas has cut electricity prices by 5 per cent and Scottish and Southern Energy has announced a 3.8 per cent reduction in its gas costs.

Granted these aren’t huge numbers, but they’re a start and, as with the banks, where these lead there’s a very good chance that others will follow.

All this information is very welcome news, of course, but it’s only of minimal interest unless you actually use it.

Historically, we’re a conservative lot and whether it’s gas, banking or car insurance we don’t like switching. It’s an attitude that makes energy companies and banks very happy, and personal finance experts tear their hair out.

Not switching costs us millions and whatever utility you’re involved with, it really isn’t difficult.

As far as energy companies go, there are some basic rules to follow.

Firstly, it’s worth checking that you’re comparing like with like. Make sure that all the companies you’re interested in have made their price changes so that you don’t miss out on a better deal in a few weeks’ time.

In the same vein, make sure you’re looking at the same tariffs. There are a myriad of deals available depending on whether you’re after dual fuel, paying by direct debit, after a fixed rate etc. and it’s important to choose the right one.

Fortunately, this all sounds a lot more complicated than it actually is. Sites such as uswitch.com and energyhelpline.com will guide through every step. A few clicks of the mouse are all it takes and you can do it over the phone, too.

Your new supplier will do all the work and you won’t notice any difference.

The principles behind changing banks are very similar. Not surprisingly, moving all your money from one financial institution to another makes people nervous. Take the fear away, however, and again it is not a complicated process.

As with energy companies, it’s important to read the small print carefully and, given the potential financial penalties for getting it wrong, it’s vital you find the account that’s exactly right for you. As an example, there’s no point in having an account which pays good rates of interest on current accounts but has massive overdraft fees, if you spend most of the month in the red.

The actual mechanics, however, are simple.

Tell the bank you’re leaving and the bank you’re going to what you’re up to and they’ll do the rest. Inform your employers and other people who put money into your account on a regular basis that you’ve switched and always keep the old account open for a few months just in case anyone’s been missed.

And don’t stop there. Home insurance, car insurance, pet insurance etc, all need to be looked at with a view to making a switch and saving yourself money.

Make 2012 your switching year. With the deals on offer and the ease of the process, there really is no excuse.