Mastering your deposit: Tips to boost your savings

One of the biggest hurdles for many prospective first time home buyers and first time investors is affording the initial deposit.

While those who already own a home or asset have the ability to either sell or use any equity they have built up, novice investors will be required to stump up a sum of money to get their foot onto the property ladder.

However, short of "buying a cup of coffee less a week" (which is real 'advice' doled out to first timers on a regular basis), what are the actual savings tips that will let you get ahead?

Here are some collected tips on how to boost your savings, push up that deposit and see yourself purchasing a property sooner than expected. There are two basic areas to improve here – earning more or spending less.

Earn

• Sell unwanted goods

If you're an average person in your 20s or 30s you will likely have accumulated a lot of unwanted "stuff". That is, clothes that you don't wear (often with tags attached for the shopaholics), outdated mobile phones, laptops and other electronics, and gifts you never wanted or never used.

A bit of time and effort online can quickly turn these into extra space in your current home and cash in your pocket. Websites such as eBay and Gumtree require you doing very little other than uploading a description and some decent photographs. Also try Twitter and Facebook shout-outs.

• Use your skills wisely

While you may not be able to take on that second job, you can still use your skills for some cash. Whether it's writing a freelance article, or creating art to sell online, there are some ways to have sideline projects. Former Property Observer journalist Nicola Trotman has Lulu's Candles - an online vegan soy candle shop - and a number of staff write freelance articles.

You may also be able to fix computer problems, or even teach people (many Community Colleges are looking for people to teach short courses and the demand for private tutors rarely eases off) or perhaps you can bake cakes to sell them to friends or at stalls. Online sites such as etsy.com can be really helpful, as can different markets that often allow you to set up a stall for a small fee. Remember to use flyers in your local area to advertise your services.

• Do odd jobs

While it can be tedious to go from person to person to find out if there's anyone who might be willing to part with a bit of money in return for someone to do the run to the shops, there's now an online solution. The website One Shift is getting even more popular as a way to get quick short-term employment for a little bit of extra cash.

• Rent out your space

If you have a spare room (or garage space), or you could bring another tenant into your rental to share costs, then either of these can be a practical temporary option.

Tips on how you can save money by spending less are on the next page.

Spend less 

• Home brand/basic brand everything

From medicine to baked beans, and from iPods to clothes, there's a generic brand available.

If you're in savings mode then you should take full advantage of these cheaper alternatives. While they may not be quite as nice, it's rare that the extra cost actually translates into the product truly being that much better. Make sure you weigh the pros and cons up first.

• Keep a coin jar 

Take out your cash from the ATM (and avoid those pesky $2+ charges at 'other' ATMs) for the week and spend no more than you have.

Try to leave the credit and EFTPOS cards at home when possible and limit online buying by having a separate card and separate account where you can limit the money that you put in. Keep access to funds at a distance and provide obstacles, and see yourself spend less.

• Cancel your unnecessary costs

Do you really use that gym subscription? Be honest with yourself about what services you are using and what you can cancel. If having a gym membership is important to you, then keep it, but if you're going once a fortnight then question the cost. Also consider your memberships to organisations, costly subscriptions to titles you may not read and other money drainers.

See if there's a way you can minimise these costs as well - are you on any plans that you can bring down a level (or increase, if you're going over every month)?

• Get gifts you need

If your birthday is coming up, ask for things you'll actually use. Maybe get them to pay for your gym subscription or thr sunglasses that you've needed instead.

• Shop around

You likely hear this one all the time, but if you can give your shipping trip a bit of extra time it'll be worth it. Most shopping centres have a Woolworths and a Coles, so pick up both brochures and look for deals.

Keep an eye out for reduced food, and when it gets reduced through the day. Remember to consider secondhand goods and books as well - just as we mentioned selling your secondhand items above, you can also pick up the things you need far more cheaply on these sites.

• Rent or borrow, don't buy

Your library, DVD rental (or iTunes rental) and your acquaintances can be used to good effect when saving money.

Instead of buying that DVD you'll watch once for $25, go and pick up a $5 rental. Sign up to your library for books, CDs and DVDs (they also have magazine sections and regularly host free events). And ask friends when you need a bigger item. Perhaps you need a steam cleaner or you find yourself needing an unusual kitchen appliance - ask around and see if anyone can lend you one for the task.

Consider sharing items such as books and magazines among friends as well - circulating these luxury items can save you a significant amount in the long term.

• Use less or use what you buy completely

It sounds hard, but it's often just a case of looking a little closer at how you go about your day. If you have food leftovers, see what you can feed to your animals (check for allergens and unhealthy items first - such as avocado, dairy, raisins and more being dangerous for dogs). You might be able to turn some of the food into "other dishes", such as turning a curry one night running into a pie the second night, or turning spaghetti bolognaise sauce into a lasagna.

However, these tips do not just apply to food - have a look at your other costs too. Consider using a two-in-one shampoo/conditioner, or toothpaste/mouthwash (a new product we've seen) that can often cost substantially less than buying and using both.

Some further tips and suggestions are on the next page. Please click below.

Extra suggestions

• Make the most of rewards points

Keep an eye on rewards cards and free store cards that can get you access to deals and offers.

Ensure there aren't any excess costs to sign up and be a 'member' that may outweigh the benefits. Ensure you only use coupons when you were already intending to buy the item (or when it turns out to be the more economical alternative).

There are a number of decent loyalty cards that can provide some significant benefits.

• Track your spending using an app

Keeping an eye on what you're spending and where can be half the struggle.

Luckily, if you're a smart phone user, then you can just download an app that will help you keep an eye on it. Consider MoneySmart if you're unsure where to start. For non-smartphone users, a simple written diary of costs and every time you purchase an item will do just as well - as will an Excel spreadsheet that you can update.

• Check if you're using the best savings account

You may be on an interest rate that's low, or an account that charges excess fees when you take money out.

Ensure you know the fine print for your accounts, and always check with your banking institution to see if there's a product that may better fit your personal situation. Many have multiple savings-style accounts.

• Look towards DIY first when you need to fix something

You'd be surprised how many YouTube videos and online tutorials there are explaining how to fix some of the most niche items. We've heard of people using online tutorials to build fireplaces, fix car windows and more.

While you want to make sure it's not another example of a "false economy" and that you will actually save money (and won't put yourself in danger), it's always worth seeing if you can reduce labour charges by doing it yourself.

• Check your tax

Are you claiming all the exemptions you are entitled to? Sometimes not using an accountant is truly a false economy, and you really want to make sure you maximise your tax return. See the claimable deductions by profession to ensure you have put everything on the list. Keep your receipts in order or recorded as you go.

• Don't miss out on special offers

If you are looking to buy something online, the first thing to do is type the name of the shop or item into Google and search for 'coupons', 'promo codes' and 'offers' to see if anything comes up. Once or twice out of 10 you might net yourself a 10% decrease, an added bonus or even a free ticket. You might also want to sign up for free online newsletters (get yourself a 'dummy' email to send these to) for comedy clubs and different events and you'll often see significant reductions being offered to online members last minute.

Just be wary that you don't buy anything you weren't initially intending to due to seeing the advertisement.

• Don't forget to argue

If you have an unfair fine - put in a call (and take photos for evidence). They can only say no. And if you have done the wrong thing, pay it on time before it gets out of hand.

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