Friday, June 8, 2012

How Clutter Costs You Money; Advice from Vanguard

In the checkout line, you search in vain for the $2-off olive oil coupon you swear you put in your wallet. Loading the groceries in your trunk, you discover the overdue library book you hunted all week for. Back home, you find two bottles of olive oil already in your pantry—both opened.
Do you have too much stuff to keep track of? Are your closets crammed with seldom-worn shoes, back issues of Car & Driver, expired bottles of cough syrup?

A love-hate thing

Accumulating things can be fun. And objects that represent goals or memories exert an especially powerful pull: Someday I'm going to sew curtains with that vintage fabric! So what if that vase is cracked—Aunt Mel left it to me!
But when your things morph into clutter, they can keep costing you long after you buy them—in ways you might not have thought about:
Duplication: It's one thing to stock up on sale items you go through quickly—printer paper, laundry detergent, coffee. But when you end up owning enough cardamom to last a lifetime, that's money wasted. Tip: Make items easy to see by installing sliding racks and turntables in your cabinets and closets.
Devaluation: When selling a house, cramped rooms, crowded closets, and overloaded shelves can be a serious turn-off. Ever have trouble selling a desk or dresser online? Look again at the photo you posted. Did the sight of your scattered papers, coffee mug, wallet, sunglasses, and so on leave a junky impression? Tip: Sell like a pro: Banish all reminders that what you're selling has ever been used by an actual human being.
Penalties: Messy desks, purses, and briefcases are the domestic equivalent of black holes: They eat important papers the way dryers eat socks.The first time the bill you meant to mail gets forgotten beneath the blizzard on your desk, you might be able to get the late fee waived. After that, good luck. Tip: Sign up for electronic bill-paying wherever it's offered.
Lost receipts: Some stores have gotten stricter about returns and exchanges in recent years, so misplacing a sales slip can leave you stuck paying for unwanted merchandise. Tip: Never let a clerk place your receipt in the bag. Tuck it immediately into your wallet (not your pocket) and keep it there until you’re sure you won't need to return the item.
Time: How much is your time worth? Do you waste it searching for the birthday card you bought yesterday, the rebate check that came in the mail last week, the belt that goes with that outfit? How much time do you spend buying even more stuff? Tip: When you enter a store or retail website, check your watch and set a time limit. Next time you shop, try to beat that.
Lost opportunity:It doesn't take a hoarding disorder for clutter to make you less efficient or interfere with priorities such as working out or cooking healthy meals. Tip: Schedule your free time in a way that reflects what matters most to you. For instance, nurturing relationships first, participating in activities second, acquiring things last.
Unproductive inventory: That's a technical way of saying you've got stuff lying around that you could turn into cash. Tip: If you aren't experienced at selling used items on web sites such as eBay or Craigslist,  start slowly. Post one item at a time until you learn the ropes.
Unproductive inventory, II: Someone out there may need just what you don't. Put your clutter to good use by donating clean, serviceable items. When giving to a charity, ask for a receipt for a possible tax deduction. Tip: Make it easier to part with your things by finding them good homes with reputable charitable organizations.
Note: This article is for educational purposes only and is not intended as tax advice. Consider consulting your tax advisor.
Source: Vanguard

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