Self storage units have gotten a lot of attention lately with A&E’s real-life show, Storage Wars. It showcases some individuals who attend auctions to bid on repossessed self storage units. The show provides a look into what Americans keep in their storage units. The show also provides the estimated value of the items that are purchased by the winning bidder. Many times the estimated market value of the items is very low.
The show got me thinking about a simple question. Sell it or Store it? What is the best financial decision? The initial monthly costs may seem like a bargain when compared to the estimated value of the items being stored. However, the monthly costs really start to add up over a period of months or years far exceeding the actual value of the items being stored.
Here is a quick example to illustrate my point. We have average size 10’ x 10’ unit. The monthly rent is approximately $110 per month. We have been renting the unit for approximately 3 years. We have paid the self storage company approximately $3,960 ($110 x36 months = $3,960) over the last 3 years. The total expense represents our payments. However, it does not take into account the lost income or gain if the money had been invested during the same period of time.
The contents of the storage unit are not worth approximately $4,000. In fact, the estimated current market value or garage sale value would be far less. We could have sold the items (probably for more then than today), not stored them and saved thousands of dollars. Why have we continued to pay the monthly fee? Because we like millions of people across America have kept making payments for things we hope we will use again one day without ever fully considering the costs vs. the value of our items being stored.
As a result, we have decided to sell or donate all of the items in our storage shed. This will save us $110 a month and simplify our lives.
Do you have a self storage unit? How much are you paying to store your stuff? What is it really worth vs. what is it really costing you? Maybe it is time to ask the question, store it or sell it? This simple question may save you thousands of dollars over the next few years.
I believe self storage units serve a purpose for people that have short term needs to store their possessions for a brief period of time. However, due to the costs it is very important to evaluate the expense and time commitment we are making to a unit before signing on the dotted line.
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