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How do I decide whether to go for a fixed deal or not?
If you’re on a price-capped standard tariff, the most important thing to understand is the rates on your tariff are variable and change every three months in line with the Price Cap.
So when considering switching to a fixed deal, you need to look at what’s expected to happen over the next year with the Price Cap. We know prices will fall by 7% in October. Prices are then predicted to rise again in January (by 6%), before falling again in Apr (by 3%) and July (2%).
Factor all that in, and with some averaging, our best guess is that a deal for 5% LESS than the current Price Cap from July to September (or 2% MORE than October’s Price Cap) could be worth considering.
This question and answer came about during the MSE Forum 'Ask An Expert' event in Sep 2023. It won't be updated so may no longer be correct at time of reading. This info does not constitute financial advice: always do your own research on top to make sure it's right for your circumstances.
If you need to know what to pay every month (like I do!) then go for a fixed rate. Act on what you can afford now, not what might happen in a few months.
If you’re on a price-capped standard tariff, the most important thing to
understand is the rates on your tariff are variable and change every three
months in line with the Price Cap.
So when considering switching to a fixed deal, you need to look at what’s
expected to happen over the next year with the Price Cap. We know prices will
fall by 7% in October. Prices are then predicted to rise again in January (by
6%), before falling again in Apr (by 3%) and July (2%).
Factor all that in, and with some averaging, our best guess is that a deal
for 5% LESS than the current Price Cap from July to September (or 2% MORE than
October’s Price Cap) could be worth considering.