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Heating Oil Budget Program

January 31st, 2013 at 05:04 pm

The heating fuel tank was filled yesterday. We've been paying in full after it gets filled, but that can cause a cash flow crunch in the cold months.

Our fuel company does have a budget program. We've explored it before, but never took advantage. We are leaning very heavily toward enrolling in the program.

The way it works with our company is, starting in July, they will take our average monthly fuel use, and multiply it by a "cap" price. We'll make 11 equal monthly payments, and settle up in June. The June payment could be more or less depending on actual usage, and actual price. Also, our budgeted amount could go up or down if our actual use, or the price is drastically different than what was figured at the beginning.

So, basically, we'll be pre paying July - October.

I know, I know, interest free loan from us to them, etc. etc.

But, once we get into the program, it will be nice to have a constant monthly payment, and not have to scramble to pay only when we're heating the house.

Are any of you on a budget plan for seasonal expenses? Do you cringe at the very idea?

Posted in Budgeting, Personal Finance | 6 Comments »

6 Responses to “Heating Oil Budget Program”

  1. creditcardfree Says:
    January 31st, 2013 at 05:20 pm 1359652802
    1359652802

    We are not currently on a budget plan, however, I have been in the past and it was very helpful from a budgeting standpoint. I would do it again. Since we are in a new home the utilities didn't want to set up a budget plan until after 12 months. I'll be looking into it this summer.

  2. MonkeyMama Says:
    January 31st, 2013 at 05:24 pm 1359653091
    1359653091

    I actually hated the idea when I first heard about it, but eventually caved. I am a convert. I Really enjoy having a set monthly bill for gas/electric. We are pretty consistent in our usage, so it seems to work very well. We've never had to "settle up" as our utilities just adjust the monthly payment every few months, and probably because we are so consistent. We only pay $100/month so I Can't imagine it making any difference in the grand scheme of things. I am definitely not losing any interest or cash flow. I just don't have to pay $150 utility bills in January or July, is all. Smooths it out - easier to budget.

    Bottom line - I like simple.

  3. PNW Mom Says:
    January 31st, 2013 at 08:05 pm 1359662720
    1359662720

    My DH refuses to do any kind of budget billing...he says he has always heard you should pay for what you use and no more. He doesn't like the idea of paying a higher amount in the summer for our natural gas usage, when we are hardly using any, even though in the colder months it would be lower than normal. I however, would love to do this, but I just can't convince him.

  4. mjrube94 Says:
    February 1st, 2013 at 02:07 am 1359684442
    1359684442

    I do budget billing for both gas and electric. I love having the set payments each month. There is a settle up each November, but never so much that I mind the "interest free loan". Peace of mind and consistency count for something.

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    February 1st, 2013 at 02:15 am 1359684956
    1359684956


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  6. LuckyRobin Says:
    February 1st, 2013 at 05:43 am 1359697396
    1359697396

    I sort of do my own budget billing when it comes to propane use. I took the amount we spent our first year, added 2%, divided it by 12 and that was how much money I set aside each month for it. Right now I set aside $100 a month. Bills are higher in winter, but the money I set aside for it in summer compensates.

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