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What I Learned from an Electric Bill

What I Learned from an Electric Bill

It may not pay to believe the obvious.

By Gary Foreman

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Sometimes finding out where your money goes proves to be an interesting journey. I remember a time years ago when I wanted to reduce the electric bill. I put the family on notice that we were going to reduce our consumption of electricity. And we did. Lights went off. Thermostats were adjusted. My wife and kids were helpful.

The next month our bill came and it was down substantially! And then I decided that we'd really attack our bill the following month. So I got even more aggressive in finding ways to cut power usage. This time my family began to grumble a little. August in Florida is no time to see how little you need the air conditioner!

Finally the electric bill arrived. I was about to be vindicated! But, wait...the bill was almost as high as it has been two months earlier. How could that be?

It took a little tracking but I figured it out by reviewing old bills. In past summers there was always one month were our bill was lower than normal. And the following month always had higher than typical usage.

The following summer, I just happened to be home when the meter reader came through our neighborhood. To my surprise he didn't visit every house. I can't be absolutely sure, but it appeared that he skipped some houses and entered an estimate of usage for that house. He would purposely guess low, so that the homeowner wouldn't complain. The next month, he would read the meter and the electric company would get what it was due.

It was a coincidence that the first month of my savings’ plan happened to coincide with the month that our bill was calculated by a low estimate. Ultimately we did find a way to reduce our bill. Our air conditioner was 12 years old and even though it cooled, it was not particularly efficient. We replaced it with a more energy-efficient model.

Trend Spotting
Why do I tell this story? Because it demonstrates a lot about achieving financial goals and the many ways you can sabotage your own efforts. 

Basing your decisions on certain assumptions does not always make sense. In my case I assumed that the electric bill represented the amount of electricity we used the prior month but this was not always the case.  

Look for trends, not quick flashes. Trends tell you a lot more about what's going on. They usually indicate an underlying, ongoing situation. If your bill goes up (or down) month after month, you know that whatever is causing it isn't likely to just disappear.

I went for the flash of two electric bills. I would have been better off with a goal of reducing the bill by 15 percent over a 6 month period. I could have avoided using bad information to make a decision. And, any change in the way our family consumed electricity would have been much more likely to become permanent.

We finally did get a lower bill. A combination of turning off lights and a new air conditioner did the trick. Not only did we reduce expenses, we learned a lot in the process!

Gary Foreman is the editor of The Dollar website and ezines. You'll find thousands of articles to help you stretch your day and your dollar.


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