If you’re downsizing, between homes or just have too much stuff, you’ve probably considered putting your belongings into storage.
But as convenient as it may sound to have a secure place to stash your stuff, renting a storage unit may not be the best financial move.
We get it — you don’t want to part with Grandma’s china collection (that you’ll probably never use), and you fully plan on digitizing those boxes of photos and newspaper clippings … one day.
But even with the best of intentions, renting a storage unit can end up being a money pit. Before you sign a contract at your neighborhood self storage facility, you should think about whether it really makes sense financially.
Are Storage Units Worth It?
When deciding whether to put your belongings into storage, here are seven things you should consider.
1. You’re Likely Paying to Store Items That Are Decreasing in Value
Unless you’re storing stuff that becomes more valuable over time — like expensive artwork or a rare comic book collection — the contents of your storage unit will probably decrease in value. But you’re still paying to store it each month.
Let’s say, for example, you started out with $2,000 worth of household belongings in your storage unit, and after a year passes, the value of your storage unit contents dropped to about $1,600. If you paid $100 a month for your storage unit, you would have spent $1,200 to keep something that lost $400 in value.
And if you’re storing items that never left their boxes over multiple moves — you’re probably hauling around stuff you really don’t need.
2. The Money You Spend on a Storage Unit Could Be Better Spent
Paying for a storage unit means you have yet another monthly bill. That’s yet another roadblock keeping you from saving more, paying off debt faster or investing.
It’s easy to focus only on the immediate issue of needing a place to stash your stuff, but don’t forget about your longer-term financial goals.
Consider if you invested $100 each month, earning 6% interest, rather than spending $100 on a storage unit. At the end of 10 years, you’d have $16,247.34.
Is paying for a storage unit worth missing out on that chance to grow your money?
3. You Could Be Missing Out on a Money-Making Opportunity
Instead of spending money to stash your things, you can earn money by getting rid of them.
Alternatively, you may be able to rent out your possessions to someone you know. For instance, a neighbor who goes to the laundromat each week might pay to use your washer and dryer.
We understand it may be hard to part with your possessions, and maybe you really do want to hold onto some sentimental items. But think about this: With the money you make from selling or renting your belongings, you can purchase replacements once you’re in a home where you have the space again.
4. Paying for a Storage Unit Isn’t the Only Storage Option
With some creative thinking or the generosity of loved ones, you may not need to spend money on a storage unit at all.
Re-examine your home to see if there are places you’ve overlooked as storage options. Could you rearrange closets to create additional space or put your bed on risers to store boxes underneath? Could you add shelving to your garage — or start parking in the driveway and use your entire garage as storage space?
Asking loved ones to hold onto your belongings at no charge may also be an option for you. Your friend who has an empty spare bedroom may gladly welcome your bedroom set. Your college-aged nephew could really benefit from borrowing your living room set for a couple of semesters.
Depending on who you’re storing your stuff with, you may want to write up an agreement outlining how long you plan on storing your things with them and what condition you expect to have it back.
5. Many People End Up Paying for Storage for Longer Than Anticipated
As you’re considering renting storage space, do you have a strict deadline for when you’ll retrieve your stuff and turn in the key? Not having a set end date can turn a couple months of needing storage into a year or more.
Data from the peer-to-peer storage platform Neighbor shows the average rental duration of a U.S. self storage unit is 14 months.
Cheap introductory rates can entice you to rent a unit, but chances are you’re going to be paying for that unit for much longer than a month or two. You’ll also want to be aware of what’s outlined in the agreement you sign. Do you have to pay for a minimum number of months? Will you be reimbursed or be able to pay a prorated amount if you leave in the middle of a month?
6. You May Be Tempted to Buy More Stuff
It’s easy to adopt an “out-of-sight, out-of-mind” mentality when your things are in storage. That’s no good if you end up going out and buying something similar to what’s collecting dust in your storage space.
And now that you’re looking at a clutter-free space, there’s the temptation to fill it back up by purchasing more stuff.
If you know you’re a person who loves to shop, renting a storage unit may only cause you to spend more money.
7. You Could End Up With Damaged Goods
You’ve probably got a buddy who has a horror story that involves a flooded or bug-infested storage unit. That doesn’t mean that’ll be your fate, but protecting your belongings with insurance is yet another expense.
When items are left unchecked over a significant amount of time, minor issues (like a bit of mold growing on a couch cushion) could grow into big, expensive problems (like needing to toss the entire sofa).
Also, if you’re not transporting your belongings and packing up your storage unit yourself, you may not be aware of items damaged during the moving process. You could potentially be paying to store items that you won’t realize are broken until months later.
Nicole Dow is a senior writer at The Penny Hoarder.
This was originally published on The Penny Hoarder, a personal finance website that empowers millions of readers nationwide to make smart decisions with their money through actionable and inspirational advice, and resources about how to make, save and manage money.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.