Sunday, January 22, 2017
Should You Put Things in Storage or Sell Them? Sell Them.
It is tempting to "save" things for later use, but in most cases, selling things and buying anew is a better bet.
In my previous posting about the Great American Storage Locker, I noted that people save a lot of junk in these storage lockers and pay a lot of money to do so. I talked with the manager of one such place, where we store our RV (it fits nicely) and she said that when they auction stuff off, it barely pays for even one month's past-due rent.
Now, bear in mind auction prices are not necessarily retail prices. But even if we assume the "retail" price (the best price obtainable for used household goods) is four or five times auction price, you can see that paying money to store stuff is sort of short-sighted. Within a few months, you have paid more to store things than they are worth.
And this reflects my personal experience. When I closed my "storefront" law office and decided to downsize to being a contractor working from home (and doubled my income, the first year - not to mention less stress!) I had to take an office building of furniture and get rid of it for the new tenants I was renting to. There were desks, book cases, a conference table, and so forth. It all cost so much money and I had to get rid of it in a hurry!
I ended up putting most of it into a storage locker. This was a Herculean task that required carrying huge heavy oak desks down flights of stairs, loading them into our truck (and cargo trailer) and then hauling them to the storage place and then carefully stacking them up so they would not be damaged.
We kept the storage locker for nearly a year, and two things happened. First, whenever we wanted to get rid of something at home, we would say, "oh, put it in the storage locker!" instead of throwing it away or selling it. This is typical of most storage locker victims. So the locker, already full, got fuller.
The second thing was I finally realized I was squandering money and put an ad in the paper to sell the office furniture. I had a few bites, but most of the stuff sold for very little (less than 1/4 what I paid for it) and at the end of the year, I was chagrined to find out that what I realized in sales prices was about equal to the storage fees.
We are not talking about junk, either. These were oak desks with glass tops. $250 office chairs that were less than three years old. Computers, file cabinets, printers, book cases - all nice stuff. Here's a hint if you are furnishing an office - look for a chump like me and buy for cheap.
In retrospect, it would have been easier if I had just put a sign on the door of my office saying "Free office furniture, take what you want!" and have someone else throw their back out hauling those heavy desks down the stairs.
In my case, at least I had some "valuable" furniture stored. Most storage lockers are full of junk. People rent them when they are evicted or have to move on a moment's notice. They take their crap, toss it in boxes and put it in a storage locker and pay years and years of rent to store half-full shampoo bottles and utter crap.
And I know this because I foolishly went to a "sealed box" auction at a storage company, and paid $50 for a box full of someone else's toiletries. Here's free advice - avoid auctions, there are no bargains there. And a "sealed box" auction has likely been rummaged through by the employees of the auction company.
And my experience with storage lockers - visiting them and seeing what sort of crap my neighbors have in their lockers confirms this experience. We stored our RV in a locker for a few years - including the generator and accessories. If that ever went to auction, it would have gotten bids in the thousands of dollars. Most of my neighbors had hundreds of dollars of junk, but paid the same $88 a month to store it.
And sadly, even for me, it was a losing proposition. Our camper is worth maybe $5000 on a good day, and after storing it in the storage locker for five years, we've spent more on storage than we did on the camper.
We currently have the camper in a storage lot for $40 a month, but it is not out of the weather, of course. But we probably will sell it in a couple of years and move on. In the past, we have paid storage lot fees for other campers, until I wised up and realized that for the cost of two month's storage fees, I could dump a load of gravel in the side yard (bounded by landscape timbers) and build a "pad" for our RV, complete with water and electric hookups. Not only did this save money, it allowed us to use the RV as a guest house and keep the battery topped off and keep it in better shape.
When we bought a boat, we sold the RV. Mark wanted to keep it, and we did for a short while. But I explained to Mark that you can have a boat or an RV, but having both made no sense. One would cause you to neglect the other, and both need a lot of attention, maintenance, and cleaning - like a second house.
Some folks put such items in storage, where they rot. You are better off selling them. Vehicles are like fresh fruit - use it or lose it. They depreciate even sitting under a cover in a storage lot. You might as well sell the item in question and put that money in the bank - where it holds its value. Down the road, if you want the item back, you can buy a similar item or even better item for less money than what you sold the old one for.
Storage lockers are poverty-think. The junk you see in storage yards often is worth less than the accumulated storage fees. There are very few exceptions to this rule - for example, someone running a business using a storage locker for inventory or even as a retail outlet (where we bought our first hot tub, for example). But those are the exceptions to the rule - few and far between.
Like with "opportunity cost" arguments, storage lockers might make sense for a money-making business, but make no sense at all for the consumer merely buying and hoarding things.
Storage locker facilities tend to be in impoverished places. And many poor folks, convinced their few possessions are priceless, pay hundreds and thousands of dollars to store things that should be sold or thrown away. Eventually, they stop paying the rent and the junk is auctioned off for pennies - because most of it isn't worth shit.
Yes, I know, you saw all that great stuff on Storage Wars. Here's the deal - they "salted" the lockers before and after the sales to make them look more interesting. You can't generate compelling television by showing people bidding on cartons containing half-full tubes of toothpaste!
Oh, you thought reality television was real? Idiot!