On Your Own Two Feet founder Helen Baker on the major money mistake that most Aussies are making - and it could cost you a house deposit or an overseas holiday

Australians spending $100 a month on multiple streaming services could be missing out on a trip to Bali or even getting a home loan, an expert says.

On Your Own Two Feet founder Helen Baker, a licensed financial adviser and author, said those paying for Netflix and a range of other subscription options could be conservatively spending $1,200 a year for something they probably don't even use.

'Often, it will be bundled in either with their phone package so they've got phone plus this, plus that... or they've got the Netflix, the Stans, the Kayos,' she told Daily Mail Australia.

'There are all these different services and some of them are used seasonally and some are used not at all.

'You get bundles of things where there's bits in there that no one uses but you're paying for all that put together.' 

Over the year, that $1,200 spent on multiple streaming services could pay for a trip to somewhere like Bali.

'That's covering all your accommodation and party money - $1,200 probably doesn't go very far in Australia but in Asia it will,' Ms Baker said.

Heavy spending on streaming services could also impair someone's ability to get a home loan.

That's because lenders, including the big banks, are required to assess whether a potential borrower can repay a mortgage, under laws introduced in 2009 during the Global Financial Crisis.

Ms Baker said big spenders and those with buy now, pay later apps like Afterpay could be potentially compromising their credit score.

'They're just little flags that they're looking for about what your behaviour is like,' she said. 

'Anything that they see that would be considerably risky - which is lack of savings, lack of managing the money that you've got, relying on credit card debt, relying on buy now, pay later - they do have concerns you have signed up to these kind of services.

'Why do you not just use your normal money to pay for those services?' 

The banks are also required to assess whether a potential borrower can cope with a three percentage point increase in variable mortgage rates.

The Reserve Bank cash rate surged by 4.25 percentage points in 2022 and 2023.

With inflation on the high side, rates could still climb beyond the existing 12-year high cash rate of 4.35 per cent.

Those who qualify for a home loan also have to pay expensive upfront lenders mortgage insurance (LMI) if they don't have a 20 per cent deposit.

Banks also charge higher mortgage rates for borrowers with a smaller deposit. 

Someone buying a $500,000 home with only a 5 per cent deposit of $25,000 has to pay $14,872 in premiums, Compare the Market calculated. 

Those with a 10 per cent deposit of $50,000 would be paying $8,680, dropping to $4,713 for someone with a 15 per cent deposit of $75,000.

Compare the Market's economic director David Koch, the former host of Sunrise, said those without access to the 'bank of mum and dad' often had little choice as house prices kept on rising.

'Some lenders will allow you to apply for a home loan with a deposit as low as 5 per cent but usually you will have to cough up more for lenders mortgage insurance - a fee that accounts for additional risk,' he said.

'With property prices climbing tens of thousands of dollars in some parts of the country, a lot of buyers feel that they are falling behind while trying to save that 20 per cent deposit.

'Those people might weigh up the extra cost of LMI and find it might be worth it.'

Sydney's median house price is north of $1.4million which means a couple wanting a home with a backyard would be typically buying something worth more than $1million.

Those buying a $1million house in an outer suburb, with a 5 per cent deposit of $50,000, would be paying $39,940 in lenders mortgage insurance.

Helen Baker is the author of On Your Own Two Feet – Steady Steps to Women’s Financial Independence and On Your Own Two Feet Divorce – Your Survive and Thrive Financial Guide