Save And Even Make Money By Organizing Your Home
Credit Card Sir’s Perspective: Organizing your home not only will provide you with more space, but it can also help you save and even make some money while you’re at it.
If your home is starting to feel like the “before” scene from an episode of Hoarders, it’s time to declutter. Think about what you’ll gain by getting rid of stuff you no longer need, want or love: more space, and less stress about the mess or about how much money you’ve spent on impulse purchases. Decluttering will make moving or downsizing easier. You’ll rediscover what you already own so you don’t waste money buying duplicates, and if you’re really ambitious, you may even be able to clean out a storage unit and eliminate the monthly fee. You can make money by reselling your stuff, or do good by recycling or donating it (and maybe take a tax deduction). But first you need to decide what to throw away.
Whether it’s piles of old receipts, cans of paint that no longer match your walls or your first two cell phones, some things just have to go. If you don’t have a use for it now, you likely never will.
Paper. It can be the toughest beast to slay, but once you’re done, you can create a system to make sure it doesn’t rear its ugly head again. Nanette Duffey, a professional organizer and the owner of Organized Instincts, in Atlanta, tells her clients to gather all their papers in one place and sort them into three piles: action, keep and toss. Bills to pay, wedding invitations to answer and permission slips to return to your kid’s school all go in the action pile.
Tackle this pile first, and knock out whatever you can right away. Next, create a space in your home for new paper — a basket by the door for mail and bills to be sorted ensures that incoming paper has a place to land — and commit to cleaning it out once a week. File (or toss) papers as soon as you’ve taken action to keep a multitude of piles from accumulating.
Most financial documents can be tossed after three years. The one exception is tax returns, which you should keep for life. You can ditch the supporting documents after three years (six if you’re self-employed). Hold on to year-end investment statements and documents showing your purchase price for stocks and mutual funds so that you can calculate the cost basis when you sell. Also keep home-purchase and home-improvement documents. Most people no longer need to pay taxes on their profits on a home sale, but if you live in the house for less than two of the five years leading up to the sale, your gains may be taxable. In that case, your home-improvement records can substantiate an increase in your tax basis, and a lower gain, if you’re audited.
Keep other financial documents for a year. You can permanently cut down on the paper pile-up by signing up for paperless billing. Utility, credit card and loan statements should be available online for at least a year, and you can save a PDF copy on your computer. Back up your files to a cloud service such as Windows SkyDrive (7 gigabytes free; $10 a year for 20GB) or Apple iCloud (5GB free; $20 a year for 10GB). Want everything in one place without lifting a finger? Manilla.com links to each of your accounts, stores statements and sends you payment reminders–and it’s free.
When it comes time to toss, invest in a quality shredder. Look for a cross-cut model — such as the Fellowes Powershred DS-2 (about $100 online) — to make sure your account numbers can’t be re-created. You can ditch receipts for anything that’s not tax-deductible, pitch pay stubs after you get your Form W-2, and toss bills older than 12 months–unless you can find them online, in which case you don’t need to keep them at all.
Appliances and electronics. Your local government or your electric utility may offer a “bounty” program for old refrigerators and freezers, providing free pickup and sometimes an incentive payment, too. To find the nearest steel recycling center, use the Steel Recycling Locator at www.recycle-steel.org. Most manufacturers and some big-box stores offer recycling for electronic products. See the EPA’s eCycling list.
Hazardous waste. Check with your county or municipality or visit Earth911.com to locate a facility where you can drop off automotive and home-improvement detritus (such as paint and solvents), cleaning products, and pesticides for disposal or recycling. You can find locations to drop off rechargeable batteries at www.call2recycle.org. Take compact fluorescent bulbs to retailers such as Home Depot, Ikea and Lowe’s.
Many of your castoffs could find great second homes and net you some cash in the process.
EBay. Go to eBay.com and register for an account. Then click “Sell” and select “Sell an item”; the site walks you through options for categorizing, pricing and shipping. (For more help in pricing your item, check completed listings to see actual sales prices.) Focus on small items that are easy to price and pack, such as designer clothes, baseball cards and jewelry. It costs nothing to list up to 50 auction items each month and add “Buy It Now” pricing; you’ll pay 9% of the total sale amount (up to $250) for each item. You can download the eBay mobile app (available for Apple and Android devices) and use your phone or tablet’s camera to scan the bar code and import details on items, such as DVDs, that are still in their original boxes.
Craigslist. Larger items, such as furniture and appliances, are perfect for Craigslist because buyers come to you to haul them away. The listings are free for a week in big cities (45 days in smaller cities). Insist on payment in cash to avoid bounced checks.
Specialty sites. For books, log on to Bookscouter.com and enter the ISBN number (located over the bar code) of the books you’d like to sell. You’ll receive price quotes from online booksellers who want them.
Sell your smart phones and other tech products on sites such as Gazelle.com, NextWorth.com, USell.com and BuyMyTronics.com. Just log on, get an offer and mail in your item. You will receive a check or a deposit to your PayPal account.
Consignment shops. Shopowners will sell your clothing or household furnishings for you. They’ll price your items based on their experience, and will reduce the price over time. They typically take one-third to one-half of the final sale price. You may need an appointment for the shops to review your stuff, or the owners may ask you to send photos by e-mail.
Yard sale. For stuff that’s not worth the trouble of listing, try a one-day-only yard sale. For extra appeal, get your whole block to participate. Not into pricing everything? That’s okay. Aaron LaPedis, author of The Garage Sale Millionaire, recommends that you put a price tag on anything you want to sell for more than $25 (so people don’t waste your time with low-ball offers), but let people make an offer for anything else. “There’s a 50-50 chance they’ll offer you more than you were looking for,” says LaPedis. Attract more visitors by listing your sale at Tag Sell It. And when the day is done, donate what’s left to Goodwill.
Estate liquidators. Call a “clean-out” company if you have a lot of stuff that you need to get rid of quickly — say, because you’re downsizing, divorcing or disposing of an estate. Some liquidators will conduct a “tag sale” in your home or off-site; they generally take 25% to 40% of the proceeds. Others buy your stuff outright, haul it away and sell it.
Donating your stuff to charity is all good: You get a warm, fuzzy feeling and possibly a tax deduction (see below). Plus, someone else benefits from your castoffs, and less stuff ends up in a landfill.
The easy solution. The easiest way to donate clothing, housewares and furniture is to contact an organization that will send a truck to pick up your stuff from your home (the driver will leave a tax receipt) and put it to work in its thrift stores. Two major players are Goodwill and the Salvation Army. Veterans organizations that provide a similar service include Amvets, the Military Order of the Purple Heart and Vietnam Veterans of America. Check the charity’s Web site, or call to verify what items it is willing to take — especially if the items are large.
Electronics. Before you donate tech gear, erase any personal data. For devices using digital rights management software (for example, products connected to iTunes, which limits files to five devices), first “deauthorize” the device. With smart phones, simply reset to the factory settings and erase the SD card. For computers, you’ll need software that rewrites data.
You can donate your cell phone to a victim of domestic violence through Verizon’s HopeLine program or to support troops overseas at CellPhonesforSoldiers.com. The National Cristina Foundation will connect you with local nonprofits that will take your computer and tech accessories, including scanners, digital cameras and modems.
Clothing. If you would like your clothing to be given to people in need, look for a “free clothing closet” in your community. Soles4Souls collects new and gently used shoes for people around the world.
Books. Some public libraries accept donations. Or look for charities that accept books at the American Library Association’s Web site.
Collections. If you have collectors’ items that you would like to donate to a historical society or museum, visit the organization’s Web site or call to ask for its guidelines for donation. Most organizations pick and choose items that have local significance, fill gaps in their inventory or are unique.
Take a tax break
If your stuff is in good condition, you can donate it to a charity and claim it as a charitable contribution — as long as you itemize deductions on your federal income taxes.
Most tax-preparation software will help you value your donated items. With TurboTax’s ItsDeductible.com, you can track contributions throughout the year so that the information is ready come tax time. The Salvation Army and Goodwill offer valuation guidance on their Web sites. Or you can assign value based on what items would sell for at a local thrift store (not the price you paid when they were new). Make a list of everything you donate, and be sure to get a receipt from the charity.
For you to claim a deduction, the charity must be nonprofit and exempt from federal income taxes — a 501(c)(3) organization. If your noncash contributions total more than $500, you must complete Form 8283 and attach it to your tax return. Single items valued at $5,000 or more require a written appraisal. But you can deduct the appraisal fee as a miscellaneous itemized deduction, subject to the 2%-of-adjusted-gross-income limit.
Donated vehicles have stricter rules for write-offs. In most cases, your deduction is limited to the amount the charity receives from the sale of the vehicle.