Saving your first deposit has to be one of the hardest things about investing in property. Most people spend everything they earn, so where are they going to find the money to save a deposit.
Most people can’t even save $1,000 for a holiday let alone $15-50,000 for a property deposit. But it can be done and there are loads of ways to make it easier.
I want to create an archive of 300 ways to save your deposit fast. However, to write a detailed list of all 300 tips would take me weeks to write and the post would be way too long for any human to read.
To avoid the overwhelming amount of information I am going to break it down into 30 different posts with 10 tips in each post. This will allow us to go into more detail than a full list of 300 tips would allow.
Posts will appear at least once per month but hopefully once every 1-2 weeks. So if you like it then stay tuned. If you have even more ideas then post them to twitter using @ryanmclean. Most tips will be focused around saving money.
1. Pay Yourself First
This is one of the most important things to do when setting a savings goal. If you have successfully created a goal with a timeline to get there then you would know exactly how much money each pay day you need to save.
As soon as you get paid put that money aside and don’t touch it. Then find a way to live off the rest of the money. If you wait until the end of the week/month to save money then you will find that you won’t have any money left.
Put it in an online saver account that is separate to your everyday account so that it is a little bit difficult to move the money out. Or better yet use a first home owners saving account where you can’t legally take the money out unless you are in serious financial strife.
2. Buy Specials And Bank The Rest
Look for the things on special at the shops. If you know you usually buy something for $5 and you got it on special for $3 then bank the $2 in your savings account.
Assume that you would have paid $5 (because you would usually pay that anyway) but put $2 towards yourself.
This may not sound like a lot of money. But if you do it every time you save money on something the figure will add up extremely quickly.
3. Buy Petrol on The Cheapest Day
If you drive you car a lot then over the course of a year you could save a bit of money by purchasing petrol on the cheapest day.
I cannot say what the cheapest day is for petrol because the petrol stations are constantly changing it to trick people. It used to be Tuesday, then it was Wednesday, then Thursday, then Saturday. They change it all the time.
A simple Google search of “cheapest day for petrol in (insert your location)” should give you an idea of when you will get it cheapest. Alternatively you can keep a look at the priced as you drive. It generally slowly goes down all week and then spikes up one day.
Saving tip: Decide in advance you are going to allocate $X.XX/Litre of petrol. Maybe it is $1.60/Litre for petrol. Then find the cheapest day and say you get petrol for $1.40/Litre then you can put $0.20/Litre into your savings account.
4. Buy A Quarterly or Yearly Travel Pass
If you take public transport to work everyday then it can work in your favor to purchase a weekly, monthly, quarterly or yearly ticket.
I have found that buying a weekly ticket generally gives you one day of travel for free. A monthly gives you almost the cost of one weekly free and a quarterly gives you over 3 weeks of the cost of weekly passes free of charge. However, this will vary from location to location.
Do the sums and work out how much money you could save buying a quarterly ticket over a weekly ticket and then put the extra money that you would have paid into your savings account.
Note: Many travel systems (in capital cities) allow you to register your long term ticket online. So if you lose it, or your ticket gets stolen then you can get a new one sent out to you.
5. Use Economic Heaters In Winter
It is no secret that the price of electricity is going up. At the time of writing the price of electricity has almost doubled in the last few years. The price of electricity is going to continue going up for the foreseeable future.
When choosing your heater for winter you want to choose one that will deliver the most heat while using the least electricity. It is about being warm while saving money.
Each heater will give you an indication of how many Watts they use. The less Watts, the less power consumption. You want to find a heater that is extremely effective (often the larger heaters) without using too much power.
It is going to be cheaper to run 1 x 3,000 Watt heater than 2 x 2,000 Watt heaters.
6. Use A Fan In Summer (and water if you have too)
Air conditioning sucks a lot of power, and as power continues to increase in price the cost of using air-condition can be significant.
Fans use a tiny fraction of the power of an air conditioner and sometimes can achieve the same result (keeping you cool).
Tip: You know how when it is windy and you get out of the pool it is often really cold? This is a natural cooling effect that occurs as the wind blows water away from your body. If it is practical you could wet your hair or your neck and then stand in front of the fan for extra cooling.
Use the air conditioner when you need to. Don’t live in a sauna. But use the fan wherever practical and you will be rewarded with a big reduction in your electricity bill.
7. Pack Your Lunch
Packing your lunch and taking it to work (or to school/uni) can save you a lot of money. Especially if you work in an area where eatng out is expensive.
Find a few meals that you love taking for lunch. Maybe you love salad sandwiches, or left overs from dinner the night before. Find what works for you and what you are happy to eat. You don’t want to miserable, so pack yummy food and snacks.
A packed lunch can cost between $1-$5 (it is especially cheap if you take leftovers to work) whereas eating out is likely to cost you $8-$25 (depending on where you work). This will allow you to save money but to have more money left over for important things like going out with friends on the weekend or going on family holidays.
8. Find 5 Cheap Dinners that you Love
Coles has recently been running advertising campaigns where they show you how you can feed a family of 4 people for under $10. This is definitely achievable if you know how to do it and plan ahead.
1 cheap dinner will never cut it because you will get bored of that type of food. Having 5-10 yummy dinners that you can make on the cheap will mean that at least once or twice per week you can have a cheap dinner, but you don’t have to repeat the same meal too often.
Get on Google and look for recipes that you can make for less than $10. Spagetti is an obvious one but there are loads of other meals that will fill you up for less than $10 for 4 people.
This may not help you save more towards your deposit. But you should already be paying yourself in advance (see point #1) so this will stretch your money further and allow you to live a more comfortable life with less money.
9. Have A No Money Day
You don’t have to spend money every day. It is completely possible to have one day per week where you don’t spend any money.
You are going to need petrol in the car and a train ticket to work but if you are already buying these in advance (and saving money that way) then you won’t need to spend money on these everyday.
Eat a home and take lunch to work. Have an instant coffee at work instead of going down to the shops and spending $3-$4 on a coffee. Make dinner using what is in thie fridge and watch an old movie or play a card game for free entertainment.
10. Shop At Aldi/Cosco or Other Discount Stores
Aldi and Cosco are great discount stores. You can often find almost the exact same thing for half the price.
Me and my family tried just using Aldi for all our shopping as it was saving us so much money, but we couldn’t do. We like eating the best cereals and I am addicted to Cadbury chocolate bars (which Aldi doesn’t sell). We just couldn’t do it.
So we create a compromise. We shop at Aldi for the things where we don’t care about the brand of the product. Things like washing liquid, instant noodle cups, lollies, vegetables, chicken skewers and a bunch of other things. We save a ton of money in the areas where we don’t really care that much about who makes the product and this stretches our money further.
Again with this strategy you should be saving money as soon as you get paid. This is about making your money go further and living more off less money.
Part #2 – Coming Soon
Here are 10 techniques for helping you save your property deposit fast. There are 290 to go before we reach the goal of 300 ways to save your deposit fast.
These tips are all about living more off less money and saving the rest. Keep visiting back to hear more tips in part #2