What is the Sharing Economy? - Storemates

This blog from Storemates contains a useful graphic that explains what the sharing economy is all about.
What is the Sharing Economy? - Storemates

David

www.house-saver.co.uk

Can I quit my day job but maintain my current living standards? PART 2

How owners of a terraced house close to a town centre can make money from their home
Last week I explained how the internet is allowing us to exploit the money making power of our homes.

This week I will be explaining how owners of a typical, centrally located, terraced house can make enough money from their home to go part-time, or even quit their day job completely.

Space is at a premium in the middle of our towns and cities.  It is this space premium that offers excellent opportunities for you to make money from your terraced house.

The approach
I am making the following assumptions.

Full-time workers
I am assuming an average full-time income of £22,100 after Tax  [derived from Office for National Statistics (ONS) figures]

I have also factored in the "cost of going to work". Quidco.com research has found that full-time workers spend on average, £3,157.92 a year to go to work. Subtracting this "cost of going to work" from the average (after Tax) income reduces the typical take-home pay to £18,942.

I have not applied any additional costs to cover childcare.

Part-time workers

I have assumed that part-time workers earn £14,100 a year on average.  After Tax is factored in, this income reduces to around £12,500.

I have applied a "cost of going to work" figure of £1,578.96 to part time workers.  Subtracting this figure from £12,500 gives us a reduced take home pay for part-time workers of £10,921.

The Opportunities
I have separated the moneymaking opportunities into "Easy wins" and "Not so easy wins".  The easy wins are more straight-forward to implement, whereas the not so easy wins may require some sacrifice or greater effort on your part.

Easy wins

Renting out your spare bedroom
Rooms are in demand at town and city centre locations.  I have suggested two routes to renting out a room in your home: taking in a lodger or hosting foreign exchange students.

Taking in a lodger provides a reliable income over a prolonged period, usually for 6 months or more. The alternative of hosting foreign exchange students will not deliver rental income week in week out. However the foreign student option would be more appropriate for those households that do not wish to tie up their spare room up for lengthy periods.

Rental income from taking in a lodger varies greatly from town to town.  Check out www.house-saver.co.uk for the typical rental values in your area.  For the purpose of this blog post I have assumed a midpoint annual rental income of around £4,500 after costs.

Note: Under the Government’s Rent a Room scheme, you can earn up to £4,250 through renting a room before having to pay tax.

INCOME POTENTIAL = £4,500

With respect to hosting foreign exchange students, expect to make around £80 per week per student. But keep in mind that the typical arrangement involves you providing both accommodation and meals.

I am assuming that you accommodate two students at a time, for 20 weeks of the year, and that you will earn the typical £80 per week per student.  This will deliver an income of £3,200.  I have reduced the earnings by £750 to take into account expenses.  This reduces the bankable income to £2,450.

INCOME POTENTIAL = £2,450

Renting out your parking space
Parking spaces are in demand in UK's towns and cities and will fetch a premium in locations within or close to the centre of town.  If you have a parking space that you do not use, why not make the most of your asset and rent it out.

If you are renting out your parking space on a monthly basis expect to earn at least £85 per month.  £85 a month is the equivalent of just over £1,000 a year.  (Your earnings can be much greater in bigger cities, where parking spaces can provide earnings of well over £100 per month).

INCOME = £1,000

Rent your shed or spare room for storage space
Specialist websites such as www.storemates.co.uk and www.sharemystorage.com will help you rent out extra space in your home for storage.  Such spaces can include your roof-space, a spare room, a shed or a garage.  The space has to be dry, secure and accessible.

The earning potential of your storage space is based on the size of the space.  Expect to earn around £100 a month from renting out a garage or large shed (or £1,200 a year).

INCOME POTENTIAL = £1,200

Reduce your water bills by fitting a water meter
Most of us spend too much on our water bills.  The Consumer Council for Water advises that the typical single person household could save up to £100 a year by fitting a water meter.

Note: Find out how much your household could actually save at www.ccwater.org.uk

SAVING POTENTIAL = £100

Reduce you Heating Bills
UK homes can be very draughty which leaves us reaching for the 'on' switch on our central heating. According to the Office of National Statistics (ONS) the average household spends £23.20 each week on electricity, gas and other fuels.

Bulking up on your insulation is the best way to make your home less draughty.  This will in turn help you save on your energy bills. The Energy Saving Trust estimates that householders could save £310 a year on energy bills by topping up on their loft insulation and by installing cavity wall insulation.

SAVING POTENTIAL = £310

Replace your old boiler
According to The Energy Saving Trust, upgrading an old boiler without controls with a new, top of the range, A-rated, condensing boiler could save households living in a terraced house £250 a year.

SAVING POTENTIAL = £250

Generate your own power
The options for installing energy generating technologies are limited for terraced homes.  However, air source heat pumps are devices that can function effectively in smaller homes.

Air source heat pumps extract the heat from the outside air. Depending on the system, this heat can then be used to heat radiators, heating fans or for certain systems to provide hot water.  They basically work like a fridge but in reverse.

Air source heat pumps are cheap to install compared to other renewable energy systems.  You could get up to £1,300 through the Government's Renewable Heat Premium Payment scheme to help with the cost of installing a heat pump.

Expect the heat pump to save you around £150 a year on your heating bills.

SAVING POTENTIAL = £150

Not so easy wins

Sell your car
Sainsbury’s Bank estimates that the average annual cost of owning and running a car is just over £2,200. There is less need to own a car when your home is close to the centre of town. Your centrally located home has the benefit of having local amenities nearby, plus you have easy access to the public transport network.

Specialist short term car renting sites and car sharing websites have proliferated in recent years.  These sites provide a cost effective route to having access to a car without having the financial burden of owning one. Plus, selling your car will free up a parking space that you can then rent out to others.

I have assumed the typical £2,200 annual running cost of owning a car. I have assumed that you will need to pay around £750 a year in additional public transport costs and for the occasional renting of a car.

SAVING POTENTIAL = £1,450

Renting your home for a photo shoot or TV shoot
If you own a house with unique design features and your property is in an accessible location, you may be able to earn money from your home by hosting a TV crew or photo-shoot.  You can register your home through specialist websites such as www.location25.com.

You can expect to earn £500+ per day per shoot.  This is not a regular income, so I have assumed only four days of photo-shoots a year.  This would deliver earnings of £2,000.

INCOME POTENTIAL = £2,000

Rent advertising space on your gable wall
This one is a long shot! But, if you are lucky enough to own a property in a very particular location, you could be on a nice little earner. Advertising companies such as Exterion will pay rents of anywhere between £750 and £2,250 a year to property owners with gable walls facing onto busy routes.

For the purposes of this blog post I have assumed a mid-point income from advertising hoardings of £1,500 a year.

INCOME POTENTIAL = £1,500

Car wrappings
Car wrapping companies such as Money4Space operate by matching up businesses that are seeking to advertise with drivers that are happy to display their ads. Once matched up, the car wrapping company will arrange to apply the ad to your car. You will be paid for each month that you display the ad.

This one is not for everyone!  Most of us don't want to turn our cars into mobile advertising hoardings. Obviously, if you have already sold your car this option will not be available to you.

You can earn around £1500 a year for displaying an ad that covers the whole of your car. Your earnings will reduce to around £900 a year for an ad displayed on the sides of your car.  If you only want the rear screen of your car to be covered, expect your earnings to drop to around £250 for a year's ad campaign.

For the purposed of this blog post I have included the £900 a year option.

INCOME POTENTIAL = £900

Summary
These money making and money saving options are summarised in the following tables.

'Easy Win' Measures	Income / Savings
Renting out your spare bedroom to a lodger	£4,500
Renting out a parking space	£1,000
Rent your garage or spare room for storage space rent	£1,200
Reduce your water bills by fitting a water meter	£100
Reduce you Heating Bills	£310
Replace your old boiler	£250
Generate your own power	£150
Total	£7,510

‘Not So Easy Win’ Measures	Income / Savings
Sell your car	£1,450
Renting your home for a photo shoot or TV shoot	£2,000
Rent advertising space on your gable wall	£1,500
Car wrappings (assuming you have not sold your car!)	£900
Total	£5,850

Grand Total

£13,360

The final tally
Implementing all of the above options (but leaving out the £900 income for car wrapping) would generate sources of income and savings worth £12,460.

By using your Tax Free Personal Allowance, and by taking advantages of the Government’s Rent a Room scheme, you would not pay Tax on any of this income (assuming that you have no other sources of income).

Whilst this £12,460 figure falls short of the £18,942 average take-home pay (after tax) of full-time workers, it easily exceeds the £10,921 average (after tax) take home earnings of part-time workers.  Not bad for a terraced house.

Next Time
In PART 3 I will be presenting the money making opportunities for owners of a typical suburban 3 bed house.

David
www.house-saver.co.uk

Can I quit my day job but maintain my current living standards? PART 1

The Dream of Financial Freedom
Many homeowners are sitting on an asset that is a worth a fortune. Yet we are still financially burdened.

Maybe you would like to take early retirement, or have the ability to go part-time, or it could be that you simply want to quit the rat race.

Or perhaps you enjoy your job and want to carry it on, but would like some extra cash to fund your children through university, or to pay for those long haul holidays that you have always dreamed about.

Or possibly you would want to start your own business from home or pursue a vocation, but need financial security before you make the leap.

Or you could simply be struggling with paying your household bills on your stagnant wages.

Unwilling to compromise
Off course we could tighten our belts a little more.  But most of us do not want to have to live like a monk to get by.

There is the opportunity to take advantage of high house prices and downgrade or move to a cheaper area. But we like our home and have no desire to move.

Another option is equity release.  But this is does not appeal to most of us.

So how can we secure financial freedom without having to live frugally and without having to downgrade?

Having your cake and eating it
In the internet age, owning a home can boost your household finances.  For home owners seeking an additional income the emergence of websites serving the "sharing economy" is becoming a real boon. These specialist websites are allowing us to exploit the money making power of our home.

Over the next 4 weeks the House-Saver Blog will be providing advice on how you can gain greater financial independence.

This week I will be explaining our approach.  In the weeks ahead I will be applying this approach to three typical home owner scenarios:

• PART 2: a city centre / inner urban 2 bed terrace house
• PART 3: a suburban 3 bed house
• PART 4: a rural 3 bed house

For each scenario I will present a range of options.  This will enable you to pick and choose the money making measures that suit your circumstances.  I will also be presenting some rather unusual options for the really brave.

Our Approach
I will be making some highly generalised assumptions.  However, the principles can be applied to almost any situation.  For example, living costs in London are higher than in the rest of the country, but so is the potential income that Londoners can generate from their home.

Cost of going to work assumptions
According to Quidco.com we spend on average, £3,157.92 a year to go to work.  This is broken down as follows:

Fuel, train fare, parking fees	£1,932.48
Lunch and snacks	£696.48
Tea/coffee/milk	£163.20
Birthday/leaving contributions	£72.84
Work wardrobe	£185.40
Sponsorship for colleagues	£25.20
Forgotten or denied expenses	£82.32
Total	£3,157.92

The above costs are extraordinarily high and they don't even factor in childcare costs.  According to the Family and Childcare Trust, for a family of two children, the cost for one child in part-time nursery care and one in an after school club is an outrageous £7,549 a year.

Current Income assumptions
The average household income in the UK for full time workers is £28,200. [Source: Office for National Statistics (ONS)]

Tax reduces this figure to around £22,100*.

Taking away the "cost of going to work" figure of £3,157.92 reduces this to £18,942.  This becomes our first target figure.

I have assumed that part-time workers earn £14,100 a year on average.  Once Tax is applied, this income reduces to around £12,500.

I have applied a "cost of going to work" figure of £1,578.96 to part time workers.  Taking this figure away from £12,500 gives us a reduced take home income for part-time workers of £10,921. This becomes our second target figure.

I will aim to present money generating options that match the above target income figures.

*Don't know your take home pay after Tax?  Check out www.icalculator.info

Other assumptions
I will be assuming that there is a spare room (or spare rooms) available in your home, plus other surplus space that you don't need, or that is under-used.

I will be assuming that you are a typical household when it comes to your expenditure on energy and other utilities.

Some of my options will require you to own a car.

Next Week
In PART 2 I will be applying the above assumptions to a typical city centre / inner urban 2 bed terrace house.  I will show how the "average" owner of such a property could go part-time, or even quit your job completely, by generating income from your property.

David
www.house-saver.co.uk

Convert your car from a money burner into a money earner

A number of dedicated car advertising or "car wrapping" websites have sprouted up in recent years.

These specialist websites aim to provide a hassle-free way for you to earn money by allowing ads to be displayed on your car.

How does it work? - At a glance
Car wrapping companies such as Money4Space and comm-motion operate by matching up businesses that are seeking to advertise with drivers that are happy to display their ads.

Once matched up, the car wrapping company will dispatch trained wrap fitters to apply the ad to your car.

You will be paid for each month that you display the ad.

How does it work? - In detail
Once you have registered on you preferred car wrapping website, you will then wait for an advertiser to be interested in your profile.

You will be notified once you have been selected.  You will then be given the details of the proposed ad and for how long you will be expected to display the ad.

If you are happy with the offer and the proposed design, arrangements will be made for your car to be wrapped.

Your car will be wrapped in a vinyl film.  This is a temporary film on which the ad is displayed.

For displays that cover windows, a special type of film is used, which appears transparent from the inside of your car yet shows an image on the outside.

The advert will remain on your vehicle for the duration of the advertising campaign.

You will typically be paid a monthly fee for the ad to be displayed on your car.

This monthly fee will depend on a number of factors, the foremost of which is the extent of your car's surface that is covered in the advertisement.

Some car wrapping companies will require you to drive a certain number of miles before you get paid.  Small GPS tracking devices are used to ensure that you are spending sufficient time behind the wheel.

Are there any qualification criteria?
The following terms and conditions for drivers are typical:

• You must be 18 years or older
• You will be expected to be the primary driver of the car
• You must hold a current MOT for your car
• Ditto, Road Tax
• Ditto, Car Insurance
• You must have no serious traffic violations or a criminal record
• You will be expected to drive responsibly, adhering to road traffic laws at all times
• You will usually be required to pass a background check and credit check
• Your car must be kept clean and well presented
• Your car must be free of damage, and be repaired if damaged
• Your car should be driven regularly (some car wrap companies will specify a minimum amount of miles that you will need to drive each month)
• You will typically be required to present your car to the car wrapping company once a month for a brief inspection check.

How much could I earn?

You can earn around £1500 a year for displaying an ad that covers the whole of your car.

Your earnings will reduce to around £900 a year for an ad displayed on the sides of your car.

If you only want the rear screen of your car to be covered, expect your earnings to drop to around £250 for a year's ad campaign.

I drive an old banger.  Does this matter?
Advertisements are custom designed to suit most makes of car. The type and age of car that you drive is less important than how your car is maintained and driven.  However, you may struggle to be selected by advertisers if your car is over 10 years old.

What if I don't want a particular Ad?

The car wrapping company will normally exclude sensitive categories of advertising such as cigarettes and booze. Ultimately, it is your decision on whether you accept the ad proposed for your car.

Will the ad damage my paintwork?
The main car wrapping companies employ expert fitters.  Car wrapping films are designed to be fitted and removed without damage.  This film actually helps protects your paintwork against stone chips, salt corrosion and wear & tear.

Will my car insurance be affected?
Your motor insurance will not normally be affected.  Indeed, the ad will make your car look unique, and therefore less attractive to thieves.

Many car wrapping companies will arrange insurance cover against damage to the wrap while displayed on your car and against theft or damage to any GPS unit you are required to carry.

Do I need to notify the DVLA?
The DVLA has specified that as car wraps are temporary, there is no requirement to notify them of any change to your car's colour arising from wraps.

Summary

This money earner is certainly not for everyone.  However, if you are not precious about having your car used as a mobile advertising hoarding, this is an easy way to make money from your car.   The specialist car wrapping websites out there will make the process of matching you up with an advertiser almost hassle free.

David
www.house-saver.co.uk