The Big Sell-Off

One thing that frequently happens when people go through a personal finance and debt epiphany is a big sell-off of their unnecessary purchases. They look around their house at all of the unnecessary stuff they’ve purchased and want to get rid of it. The logic behind this usually comes from one or more sources, among them:

The stuff itself can be a mental block. The presence of a 2,000 CD collection can be a pretty blunt reminder of the foolishness of their spending ways, and it becomes a big mental weight after a while. You just want it out of there to get a fresh start.

The stuff has some cash value that can be turned into debt repayments. That 500 DVD collection has some cash value just sitting there, and now I more or less see it as a waste. Why not turn it into some cash and get rid of that debt a little faster?

It simply feels like a way to take action. When the sense that things really need to be turned around hits people, they often respond with a fervor and want to take action now. Selling unnecessary stuff off is one way to act on that fervor.

I did a big sell-off myself, getting rid of more than a thousand CDs, two hundred DVDs, three video game consoles, about sixty games, and a small mountain of baseball cards – and quite a few other miscellaneous odds and ends that I barely remember. This big sell-off was almost entirely channeled towards paying down my personal credit card debt, eliminating a sizable portion in one swoop.

Here are several tactics to consider if you’re looking at doing a big sell-off.

If you’re unsure, sell it. I started off with just the opposite attitude and I wound up just keeping stuff I didn’t use for very obscure and minor sentimental reasons. Only keep the stuff you’re sure you want to keep – if you’re feeling unsure, either directly specify your reason for keeping it or toss it. If you find that you miss it later on, buy it used – after all, you’re selling it used, right?

For most large collections, identify the individual items that have significantly higher individual value and sell those individually. For example, with my DVD collection, I separated out the box sets and sold them individually on eBay. With my baseball cards, I did the same thing, more or less – I sifted out singles that had obvious value and sold them individually.

My rule of thumb was this – if I felt I could get more than $10 for an individual item, I sold it individually – that’s profit, after all fees and such. My way of doing that was to search any items I thought might be that valuable on eBay. If they exceeded a sale price of about $12 or so, I took the effort to sell them individually.

Why? I estimated I would invest about forty five minutes per sale, all told, and I valued my time at about $10 per hour. I figured that with bulk selling I might be able to recoup a couple of dollars per item, so effectively I was deciding to make at least $8 for my 45 minutes of work for those items over $10 – about right, I’d say.

I almost exclusively used eBay for the individual item sales. eBay allowed me to get more for those individual items with some value than reselling ever would have, assuming of course that the individual items had value themselves. If you’re looking to sell a single film DVD or a single CD, for instance, or any individual baseball cards from the late 1980s, eBay probably won’t fetch you much at all as compared to the time invested, so focus only on individual items with significant value.

Sell the remainder in bulk. What about the mountains of stuff left over? The best approach in terms of time investment is to sell it in bulk. There really are two options – either create some bulk auctions online (like a specific number of DVDs per auction – say 10 – and collecting ones that might have value to the same buyer together) or just take them down to your local used media shop.

Bulk selling online can be tricky, as it relies quite a bit on multiple interested parties discovering and being interested in your small collection. Thus, if you decide to try to sell bundles of DVDs online, consider carefully how to label them. Make sure to include the most well-known items in the title of the auction.

For me, at least, I decided the time investment in selling DVDs and CDs in this fashion online was too much of a time investment and chose to sell them at a media shop. Although I’m sure I could have made more online, the time investment would have been significant.

Don’t just immediately throw that cash into debt repayment. Look down the road a little bit and ask yourself if there aren’t other moves that will pay off more, like putting that cash into items to make your home more energy efficient (like energy efficient lighting, air sealing your home, a water heater blanket, or a programmable thermostat), thus permanently reducing your home energy bills – items like these truly are an investment, as you put in money at the beginning but they pay a lot of dividends over the long haul. Then, each month, you can roll that energy bill savings into debt repayment and, over the long haul, wind up in better financial shape because of it.

Good luck with the liquidation! I’ve rarely missed all of the stuff I sold, but I’ve certainly enjoyed the freedom from oppressive debt.

Trent Hamm

Founder & Columnist

Trent Hamm founded The Simple Dollar in 2006 and still writes a daily column on personal finance. He’s the author of three books published by Simon & Schuster and Financial Times Press, has contributed to Business Insider, US News & World Report, Yahoo Finance, and Lifehacker, and his financial advice has been featured in The New York Times, TIME, Forbes, The Guardian, and elsewhere.