As many British households feel the squeeze ahead of the January pay day and look to review their finances for the year ahead, new research from Santander Current Accounts1 reveals bill payers underestimated their main expenses - council tax, utilities and TV, phone and broadband - by an average of £1,4592 last year. That’s equivalent to almost £39 billion3 across the UK as a whole.

The findings show that whilst bill payers estimated their annual household bill costs to be £2,528, in reality, they spent an average of £3,987. Of all the bills, TV, phone and broadband outgoings were the most significantly underestimated with households estimating annual spend to be 53% lower than actual costs.

The research also highlights that many households are struggling to cover the cost of their household bills. 34% say they can only just make ends meet, one in four (25%) admit to borrowing money or raiding their savings in order to pay their bills and 6% claim they often do not have enough or never have enough to pay their bills.

Matt Hall, Director of Banking at Santander, said: "It can be difficult to keep track of bills and price changes. In winter months, when bills may rise, it’s even more important to make your money go further.

"At a time when many households are reviewing their annual expenditure and trying to cut costs, it’s worth remembering that it’s often cheaper to pay your household bills by direct debit. Santander’s 1|2|3 Current Account gives up to 3% cashback on household bills paid by direct debit, such as telecoms, gas, electricity, water, council tax, and Santander mortgages. This cashback combined with up to 3% interest on the account balance is a simple way to ease the pressure on household costs."

Santander's research does suggest that households are taking proactive steps to monitor energy consumption and reduce costs, as one in eight (12%) have a smart meter or plan to install one.

One reason why estimated and actual bill spend differs may be a lack of attention to bill statements. Almost a third (30%) of bill payers admit they do not read their statements thoroughly, while 5% do not even open their statements.

The 1|2|3 Current Account offers great value with up to 3% cashback on household bills and interest of up to 3% on account balances for a monthly fee of £5. The account can be opened online at, by telephone on 0800 068 6069 or in any Santander branch.

The 1|2|3 Current Account pays cashback on household bills paid by direct debit

  • 1% cashback on water, council tax and Santander mortgages
  • 2% cashback on electricity and gas
  • 3% on mobile, home phone, broadband, paid-for TV packages

The 1|2|3 Current Account also pays in-credit interest

  • 1% AER on the entire balance, once the customer’s balance is £1,000 or over
  • 2% AER on the entire balance, once the customer’s balance is £2,000 or over
  • 3% AER on the entire balance, once the customer’s balance is £3,000 or over (up to £20,000)


The information contained in our press releases is intended solely for journalists and should not be used by consumers to make financial decisions.

Notes to Editors

  1. Survey conducted by Opinium Research (19th – 21st October) interviewed 2,001 UK adults aged 18 and over.

  2. Bill payer estimates of household expenditure are taken from the Opinium survey, while actual spend data is taken from the most recently available ONS Living Costs and Food survey.

  3. Based upon ONS 2015 estimate of total number of UK households (26,703,000). £1459*26,703,000 = 38,959,677,000

Table: Breakdown of actual vs estimated spend per household bill

Source: Santander, 2015

Bill typeActual spend per household 2015Estimated spend per household 2015Under/over estimation
 TV/phone/broadband £1,100 £514  -£586 
 Council tax £1,121  £754  -£367 
 Gas £658  £450  -£208 
 Electricity £680  £497  -£183 
 Water £428  £313  -£115 
 Totals  £3,987  £2,528  -£1,459

 Table: Breakdown of those who have borrowed money or raided savings to pay their bills

Source of funds%
 Credit card 44% 
 Friends or family 42% 
 Savings account 31% 
 Personal loan 18% 
 Payday loan 10% 
 Your child's savings account  3%

 Source: Santander, 2015

About the 1|2|3 Current Account
Cashback can only be earned through household bills paid by direct debit from the 1|2|3 Current Account.
To benefit from cashback and interest customers need to pay a monthly account fee of £5, pay in at least £500 a month (a minimum balance of £1,000 is required to receive interest) and set up a minimum of two active direct debits.

Santander UK is a financial services provider in the UK that offers a wide range of personal and commercial financial products and services. It has brought real competition to the UK, through its 1|2|3 products for retail customers and relationship banking model for UK SMEs. As at 30 June 2015, Santander UK was the most switched to bank, attracting 1 in 4 new retail customers. The bank serves more than 14 million active customers with c. 20,000 employees and operates through 900 branches and 68 regional Corporate Business Centres. Santander UK is subject to the full supervision of the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) in the UK. Santander UK plc customers are protected by the Financial Services Compensation Scheme (FSCS) in the UK.

About Us
Banco Santander (SAN.MC, STD.N, BNC.LN)
is a leading retail and commercial bank, based in Spain, with a meaningful market share in 10 core countries in Europe and the Americas. Santander is the largest bank in the euro zone by market capitalization and among the top 12 banks on a global basis. Founded in 1857, Santander had EUR 1.51 trillion in managed funds, 12,910 branches and 190,000 employees at the close of June 2015. In the first half of 2015, Santander made ordinary attributable profit of EUR 3,426 million, a 24% increase.

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