We all have clutter, but we tend to assign value to things we spent a lot of money on, or that were given to us. Finance blogger Mr Money Mustache has some simple advice for combating this: "If you wouldn't buy it, you should probably sell it."
Picture: Dylan Parker
He uses some pretty big-ticket examples, like a car:
In the introductory story, the brand-new Mustachian is currently burdened with a money-burning 2010 Mazda CX-9 SUV, which would fetch about $12,000 on the used market. If she were starting from scratch with $12,000 in the wallet and no car, would she buy the same vehicle? Or perhaps the far superior 2010 Honda Fit which handles better, will cut the running costs in half, and costs over $3,000 less?
The $3000 cash difference plus a savings of $2500 per year in fuel, depreciation and maintenance will compound to a wealth difference of over $30,000 per decade, just from this one decision. Not many people realise the staggering effects of a poor vehicle choice, which is the reason SUVs exist in the first place. But now that the new knowledge has been acquired, it is time to act on it. Since she wouldn't buy the SUV right now, she should sell the SUV right now.
This applies to small stuff too, though. For example, I recently got married, and someone gave us a very nice waffle iron as a gift... that I knew we would rarely use, despite my wife's excitement. She was torn on whether to keep it, so I asked: "If you didn't have it, would you buy it?" She immediately said no, which was a clue that we should exchange it for something we actually need.
So the next time you feel like you need to keep something because you "might use it", or because someone gave it to you, or because it's already in your cupboard, ask yourself if you would buy it again today. If not, maybe it's time to sell it. Check out Mr Money Mustache's full analysis below.
If You Wouldn't Buy It, You Should Probably Sell It [Mr Money Mustache]