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Sunday, November 13, 2011

The Cost of Stuff-itis, It Can Make or Break You

       Some people might say what is stuffitis.  It is stuff.   How we get it, and what we do with it shapes our lives and our destiny.  The question is do you have stuff or does stuff have you.  If you have ever watched one of the programs called "Hoarding" you are witnessing stuff-itis out of control.  Hoarders are created several ways.  Some people look at everything they ever purchase as an investment.  Therefore is has value and should be kept no matter what.  Other hoarders no that the stuff they have accumulated has no value anymore but they can not decide what to get rid of.   Yet others consider anything they get as adding to their wealth and making them better off.  Many of us fall at some level into cracks between the extremes.  All stuff has a cost.  Sometimes to acquire it.  Sometimes to keep it.   Sometimes it is because it is kept.  When it gets out of hand and is infested by insects, rodents or mold it can even effect the health of the hoarder.

       Most of the time I see it, in my opinion, as a failure to understand how to manage money.  Often times hoarders are virtually destitute even though they have a big enoung cash flow to meet their needs.  The problem is it is mismanaged.  If a person has never been taught how to save money they purchase items they do not really need simply because they have the money to do so.  It is this last bunch that the media advertising dollar is targeted at. 

      In my own case I have far more than I actually need, but I have discovered how to use stuff-itis of others to meet my financial needs.  Being on disability and some months not having enough to get by my solution was to go to yard sales and auctions looking for "good deals" that I could by for pennies on the dollar and resell for a profit.  My goal is to get it for a fifth of its value and sell it for as much as possible.  Hopefully for at least half its new value.  Even if I only sell it for two fifths of its value I have doubled my money.  If you can double your money and keep doing it consistently you should get ahead sooner or later.  The trick is learning to buy only stuff you can sell, and that you will sell.   If you end up keeping it yourself your losing ground.  Also just because it is cheap does not always mean it is a bargain.  Some stuff is cheap because nobody wants it.  Which means you will not be able to sell it no matter how cheap you got it.  I learned this lesson the hard way.  At one auction I got five couches for five dollars.  After a year I had sold one for ten dollars.  The rest of them I wound up burning so I would have room in my shop for new stuff or at least more stuff.  In the end my accomplishment was to pay to remove someone else's trash.  So even though I doubled my money it was really a loss.  Fortunately it happened early in my career of selling "Stuff."  Several years later I have learned to leave many things sitting even though they are cheap.  If you can not sell it you are simply paying to become a hoarder.

     It is not always about used stuff.   Many people have to stroke their ego and drive a brand new car.  That new car will lose several thousand dollars in value the moment it leaves the showroom floor.  If your ego needs it and you consider it worth it go for it.   It might be a lot better investment to buy a slightly used version of the same car and put the thousands of dollars in your pocket.   A compromise way to buy a new car and one I have done myself is to buy last years car.  When the 2012's come out you simply go looking for a new 2011.  The best time to actually buy it is just before tax time in 2012.  You still have a car only you have driven.  While also saving some on taxes in many states.  The taxes are less on a technically two year old car.  The goal is to save money.  Part of the trick to that is get your own preapproved credit so you can shop and know how much you have.  If you have been shopping since the 2012's first came out you know what a 2011 was really going for.  You can make an offer several thousand dollars below the asking price. When you tell them you have your own financing and your offer is a take it or leave it offer.  They will probably deal.  You might have to haggel a little, the secret is knowing what it is worth and what "You" are willing to pay.  Dealers hate letting a sure deal walk out the door even if they do not make anything on the car.  Their goal is to move it, if it is last years model.

     When I go to yard sales and auctions I see stuff sold for pennies on the dollar.  The people are trying to get rid of something they no longer need and in many cases never needed in the first place.  One of the things I see this on the most is excercise equipment.  Tread mills, excercise bikes and weight benches.  Most of them have been sitting for years and the only excercise they saw was as a coat or clothing rack.  The trick to this whole deal and how make money from Stuff-itis is knowing what people will buy and really need.   A couple things I always, eventually, sell is baby beds, chest of drawers, rockers and recliners in good condition.  It is a learning process, but it can supplement your income to some degree.  It could make a lot more if  one pursued it, but for me it is a way to make gas money so I am not stuck at home all the time.

      The next time you are having a yard sale do a quick.  See how much of the stuff you have out for sale that you never really needed in the first place.  Also when you are planning to make a purchase of some items you do not need right away, but that you know you need.  Take a small tablet and write the price of the article down at several competing stores.  It can save you  a lot of money over impulse buying.  Hopefully this will help someone get in control of their stuff-itis.

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