Savings accounts a good idea in light of imminent power price hikes?

Mozo

Monday 23 May 2011

Opening a savings account now could be a wise move in light of one expert's assertion that the cost of power is set to increase significantly over the coming years.

Electricity prices 'set to soar'

Richard McIndoe, chief executive of gas and electricity giant TRUEnergy, observed that a carbon price and general increases in the cost of power could see average bills double within six years, reports the Australian Associated Press.

He noted that over the last three years there has been a 40 per cent rise in prices, but the hikes are unlikely to stop at their current level.

Indeed, Mr McIndoe asserted that they could increase by another 30 per cent in the next three years and that a carbon tax may add another $300 to the bill of each household.

"So for a six-year period you're seeing an effective doubling of electricity prices per household with no tangible benefit," he calculated.

This comes after financial planners David and Libby Koch said in a piece for News Limited newspapers that forward-thinking Aussies should set aside six-months salary in a savings account to protect them against unforeseen financial difficulties.

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