Bank, phone and work hacks among 11 ways to save £7,000 a year for house deposit

The task of saving for a house deposit is often seen as one of the most daunting financial challenges, especially considering the substantial sums required for a decent down payment in today's housing market. However, the financial gurus at Mojo Mortgages have put together a list of easy-to-implement strategies that could potentially save thousands each year, thereby reducing the time it takes to secure your first home.

In total, the experts suggest that their 12 tips could result in an annual saving of up to £7,130. However, they cautioned that these techniques may not be equally effective for everyone, citing the example of remote working, which isn't feasible for all job types.

Working from Home

For those who can, the experts recommend working from home two days a week, which could lead to an impressive annual saving of £1,006. Citing a study by Bionic, they explained that the average office worker spends £95.48 per week on commuting and meals at the office.

By working from home two days a week, this cost could be reduced to £76.12 per week, resulting in significant savings over the course of a year if this hybrid working pattern can be maintained.

Lifetime ISA

Experts have recommended eligible savers to consider opening a tax-free Lifetime ISA (LISA) in order to benefit from the annual 25% government-backed bonus. LISAs, which are available to individuals aged between 18 to 39, permit a maximum deposit of £4,000 each year. Consequently, savers could potentially receive an annual windfall of up to £1,000.

However, there is a catch to the LISA: it can only be utilised towards purchasing your first home or saving for retirement. Any withdrawal of funds for other purposes will result in a penalty that effectively nullifies the 25% bonus.

Bank switching

A bit of strategic banking - switching accounts - could bag you a tidy sum. The experts suggested shopping around for banks offering incentivising cash rewards for account switching, amounts often range from £100 to £200 and beyond.

They stressed: "There is no limit to how many times you can switch accounts and claim these cash bonuses, as long as you meet each bank's specific requirements like setting up direct debits, paying in a minimum amount, etc."

"In fact, some savvy customers have reported earning over £1,000 just from switching accounts repeatedly over a few years," however, those planning to purchase homes within the next six months are cautioned against this strategy as repeated credit checks performed during each switch could alarm mortgage lenders.

Eat out less often

According to Nimblefins, Brits spend an average of £1,220 on dining out each year. However, Mojo Mortgages suggests that by simply halving this expense, you could still enjoy some well-deserved treats while saving £610 towards your deposit.

Ditch the dog walkers

Many pet owners employ professional dog walkers to ensure their pets get the exercise they need when they're too busy or at work. The experts suggest that by ditching the weekly professional dog walker and setting up a rotating group of walkers among other pet owners, you could save £585 per year.

Avoid food brands

One of the easiest switches suggested by Mojo Mortgages is to swap name-brand items for generic or store-brand products. This could cut your grocery bill by 30%, saving up to £538 over the course of a year.

Selling what's unwanted

A good declutter not only benefits your mental and physical health by creating a less crowded living space, but it can also add some extra cash if you sell the items you no longer want. The experts cite research by PayPal which claims the average adult has £341 worth of unwanted items in their home.

Sim-only phones

Switching from a mobile and SIM deal to a SIM-only contract when your current plan ends could pocket you a whopping £321 annually by dodging the steep monthly fees that come with snagging a new handset even if it's included in your contract. The savvy advisors suggest: "If your handset is working and you don't feel the need to upgrade it to the latest phone, you could make a big saving."

Packed lunch

Workers not reaping the benefits of home office savings can still slash their weekly outgoings by opting for a homemade packed lunch over splashing cash at nearby food joints during their break. According to research by Reed, the average Joe could keep a cool £320 in their pocket each year by prepping lunch at home rather than succumbing to even the most wallet-friendly meal deals, with potential savings soaring over £1,400 for those dining at restaurants or cafes.

Cashback websites

Brits willing to put in a tad more graft in their shopping research can bag some serious bargains, especially when hunting down cash-back offers that apply to an array of products, from snazzy trainers to essential household appliances. Mojo Mortgages highlights one site, TopCashBack, where the typical user rakes in over £300 annually on their usual buys.

Pay annually

For savvy savers looking to cut costs, experts have revealed that paying car insurance annually rather than monthly can pocket drivers an average of £59 by dodging the interest charges typically associated with instalment payments. They also advise: "The optimum time to buy your car insurance is 20-26 days beforehand so set a calendar reminder to do this to get the best deal too."

When it comes to energy efficiency, most smart meters won't cost you a penny to install and could be instrumental in monitoring energy consumption. Research from The Behavioural Insights Team, highlighted by the experts, suggests that medium-sized homes could see annual savings of up to £50.