Four bills a year. Never the same size twice.
Summer aircon and winter heating both push usage up, so dividing your annual power bill by four gets the maths wrong in both directions. This Bucket weights each quarter to how you actually use energy, and keeps the money offsetting your mortgage until each bill is due.
Your usage is seasonal. Your budgeting probably isn't.
Like school fees, this is a Bucket with money flowing in and out at the same time — you save monthly and pay quarterly. But unlike school fees, the amounts aren't even. A summer quarter with the aircon running and a winter quarter with the heating on both cost more than the shoulder seasons in between.
Divide your annual bill by four and you'll over-save in autumn and spring, then come up short exactly when the big bill lands. It reads as a budgeting failure when it's really a modelling failure: the average was never the right number for any individual quarter.
Bill smoothing programs offered by retailers solve this by taking a fixed amount from you every month. The trade is that they hold your money, not you. Doing the same thing inside your own offset account gets the smoothing without handing over the balance — and every dollar keeps working against your mortgage until the bill is actually due.
Utility bills Bucket calculator
| Month | Balance start | In | Out | Balance end | Interest saved |
|---|---|---|---|---|---|
| Month 1 | $1,600 | $133 | — | $1,733 | $9 |
| Month 2 | $1,733 | $133 | — | $1,867 | $9 |
| Month 3 | $1,867 | $133 | $448 | $1,552 | $9 |
| Month 4 | $1,552 | $133 | — | $1,685 | $8 |
| Month 5 | $1,685 | $133 | — | $1,819 | $9 |
| Month 6 | $1,819 | $133 | $288 | $1,664 | $9 |
| Month 7 | $1,664 | $133 | — | $1,797 | $9 |
| Month 8 | $1,797 | $133 | — | $1,931 | $10 |
| Month 9 | $1,931 | $133 | $512 | $1,552 | $9 |
| Month 10 | $1,552 | $133 | — | $1,685 | $8 |
| Month 11 | $1,685 | $133 | — | $1,819 | $9 |
| Month 12 | $1,819 | $133 | $352 | $1,600 | $9 |
Drag any quarter's slider and the other three adjust automatically to keep the year at 100%. "Building it as you go" starts the Bucket at zero and can dip negative before contributions catch up. Default weighting assumes a summer and winter peak; adjust to your own climate and household. Figures shown are electricity only — add gas and water for a full utilities picture.
The winter bill that already has money against it
On a $1,600 annual bill weighted to real usage, the winter quarter runs around $512 while autumn runs closer to $288. Divide the year evenly and you will be over-saving in the mild quarters and short in the cold one.
Setting aside $133 a month against a properly weighted schedule means the heavy quarter is fully funded before it arrives. No scramble, no shifting money from somewhere it was needed.
This is what energy retailers sell as bill smoothing. The difference is that here you hold the balance rather than them, and it reduces your mortgage interest for the entire time it sits there.
Setting up a utility bills Bucket
Create a Bucket called "Utility bills", set your annual total, and weight the quarters to your real pattern. Savvy Dollar tracks what's already claimed between bills, so a heavy winter quarter doesn't quietly eat money meant for something else.
Buckets people pair with this one
Common questions
Should I save for utility bills in my offset account or a separate account?
Your offset account, in most cases. A utilities fund holds a balance year-round as it builds toward each quarterly bill, so it's exactly the kind of money that benefits from reducing your mortgage interest continuously rather than sitting in a low-interest savings account.
How much should I put aside each month for electricity?
Take your annual total and divide by twelve — around $135 a month on a $1,600 annual bill. The calculator above does that, but also weights each quarter so you can see which bills will be bigger than the average and plan for them rather than being surprised.
Why is my electricity bill so much higher in some quarters?
Seasonal usage. Cooling in summer and heating in winter both push consumption well above the shoulder seasons, so the same household on the same tariff can see a summer or winter bill run 30% or more above an autumn one. Nothing about your habits changed — the weather did.
Is bill smoothing with my energy retailer a good idea?
It solves the right problem. The trade-off is that your retailer holds the balance instead of you, and you may end up in credit for months at a time with no benefit for it. Doing the same smoothing in your own offset account gives you the even monthly amount while the money keeps reducing your mortgage interest until the bill is due.
Should utility bills go in a separate savings account?
They don't need to. The point of separating them is knowing the money is claimed, not physically relocating it. A Bucket does the claiming while the cash stays in your offset — which matters more here than for most goals, because a utilities fund holds a balance year-round rather than emptying out.
Never mix up the utility bills money again
Set it up as its own Bucket in under two minutes.
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