Independent filmmakers are wary of effects, not without reason. They can be time-consuming and expensive, require some expertise, and can distract you from telling your story. But they can also help you tell your story and raise your production value . If you just follow some simple steps, you can produce good effects on a tight budget. So don't be afraid. The force is with you.

 Special effects can be broken down into four broad domains:

1. Hair/Makeup
   Includes blood, tattoos, prosthetic monster faces/limbs, aging
   
   
2. Mechanical
   includes smoke/fog, fire, wind, rain, lighting, automation (think of the doors opening on "Star Trek"), puppetry, explosions, gunfire
   
   
3. Camera
   includes shakes, split focus, on-set filtering, slow-motion/fast motion, fancy camera moves, shutter-angle adjustments
   
   
4. Visual/Post
   includes greenscreen or other compositing work, 2D and 3D animation, digital blood/prosthetics, color correction and filtration

In practice a single "effect" may require all of the above.  A ghost may be a guy in a prosthetic outfit, who comes out of the fog, is shot in slow-motion, and is then tweaked in post to appear more "ghostly."

Here are some tips for doing low-budget effects:

1. Limit the "scope" of each effect.  The above-mentioned ghost example requires all four domains - that's four things and more people that have to work together to sell the effect.  Do your ghost effect without moving the camera, or with minimal makeup work.
2. Try to do as much work on-set as possible.  Post effects work can be costly and time-consuming.
3. Conversely, it's worth looking into digital gunfire and wounds/blood.  It's safer, (sometimes) faster, and armorers, squibs, and blank-firing weapons aren't cheap.
4. Use rubber prop versions of your weapons as much as possible.  They're safer and still look convincing.
5. Light greenscreen and foreground elements separately, and keep them as far apart as possible.
6. Don't move the camera if you're doing a composite shot.  Shoot the various elements with the same angle, height, lens, f/stop and focus.  This will make your VFX artists' job a LOT easier.
7. If you're doing post animation, write down then lens height, lens length, exposure, filters, and focus when shooting your elements.  Jot down a lighting diagram.  This helps the animators match their lighting.
8. Do NOT schedule makeup effects shots for the beginning of the day or right after lunch.  Prosthetics take a lot of time to apply - so shoot something else with other actors first.
9. Budget for post "tweaking."  No matter how well-executed a shot is, chances are you'll have to work on it in post at least a little.
10. Shoot clean background plates, without actors.  This gives the VFX artists something to use if they have to paint someone or something out of a shot.
11. Gore looks cheesy very quickly.  Less is more.

Most importantly, don't schedule too much on your effects days!  Take the time and be safe.  Good luck!