07/08/2024
Energy Rebates 2024
Like our household, many people would have recently received an energy bill for the month. Or maybe yours is still coming if you are billed quarterly.
The nice surprise is that the government rebates have been applied to your account so your account is most likely IN CREDIT. The electricity company will hold the rebate and apply it to your future bills until it is fully utilised. Then you will need to start paying out of your pocket again.
The first page of the bill might display the credit amount or it might just say 'NIL to pay' depending on your provider.
Yippee you say - I don't have to pay an electricity bill this month - breathe a sigh of relief and move on to the next activity you had planned, or perhaps head out for lunch or a coffee knowing you have one less bill to pay.
Let's have a closer look and try some Money Management Magic now.
Take a moment to stop and look at the detail of the bill. It will show you the amount that you would have had to pay if it weren't for the government rebates. When the government rebates have been fully utilised you will go back to having to pay these bills.
Think for a moment. If there were no government rebate, you would need to find this amount as you normally would. Could you pay the bill if you needed to? If so, **what else could you do with the money** you would have otherwise paid to the electricity provider?
Without any thought at all you could just let it flow through your normal finances:
- you could redirect the funds to some other spending
- you could recognise the amount as a gift and splurge on something you want
With a bit more thought you could put the rebate to work by paying the equivalent amount into something useful, and gain more through the benefit of compound interest:
- you could pay it into a mortgage offset account to reduce some mortgage interest
- you could make a payment against a credit card or other loan to reduce or clear the balance and reduce future interest payments (maybe start with the loans with the higher interest rate)
- you could make an extra contribution to your superannuation account and let the funds build for your retirement (you might even qualify for a government co-contribution)
- you could start or add to an emergency fund so that you have some additional cash available for future unexpected expenses (and earn some interest until you need it)
- you could open a separate bank account to accumulate the benefit of the rebate and earn interest on the funds you haven't had to spend on electricity, starting a savings habit
Which will you do?
This article provides general information only. It does not take into account your personal situation. You may wish to seek expert advice to assist you with financial decisions.
If you are in financial distress you may need to seek the support of a financial counsellor.
