You can learn a lot about people by going through their storage units

According to one site the storage unit business in the United States is about a $39 billion dollar a year business. The wealthiest individuals in Kentucky are the founders of a storage company in the state and his daughter. They are both billionaires. It is estimated that there are between 45,000-60,000 storage units in the country and that nearly 10 percent of Americans rent at least one unit.

Chances are you have watched the TV program Storage Wars at least once. When people rent storage units and do not pay their rent for several months the storage company is allowed to auction off the contents of the unit to recoup their expenses. The program highlights several buyers of those units in California. I find the program interesting even though one of the buyers has claimed the show is rigged. His claim is that some of the expensive items found in the units that are bought by the buyers are put there by the producers to make the show more interesting to the viewers.

I have bought an occasional storage unit in the past myself, and I can tell you I never found a Picasso wrapped in an old blanket nor have I found safes filled with money or gold and silver coins. A good unit produces enough good items to pay for itself and a little profit. Most of them contain a lot of junk that has to be taken to the dump. Much of what is found there is evidence of a lot of bad choices in the person's life that explains why they were not able to pay their rent. For the life of me, I can't understand why people would pay good money to rent space to keep much of what I find in storage units. Sociologists and other social scientists would have a field day exploring what people keep in storage units!

The buyers on Storage Wars often point out that buying these units is a numbers game. Some of them have said that for every 10 units they buy one pays off well enough to make it profitable. That's probably accurate. This article isn't to help you become a good storage unit buyer. I wouldn't know how to write an article like that based on my limited experience buying units! The purpose of this blog is to encourage you to make better choices in life.

The average cost of a storage unit according to the site I referenced earlier is $89 a month. That is over $1,000.00 a year with some units renting for more than twice that amount. To be completely transparent, I do rent a unit for slightly more than that, but my unit is rented to store items I sell at auction and my supplies. It is a legitimate business expense.  Many units are rented by small business owners for the same reason. This is much different than the typical renter who is spending money each month to store junk they don't want to pitch.

What does the typical storage unit renter store for his $89 a month or higher rent? You'll find a lot of dirty mattresses, broken toys, bags of clothes that usually ends up stiff and moldy in their black trash bags after a few months, broken and ripped furniture, broken bicycles, book and magazines, food items (which has attracted mice), personal papers, kitchen items such as plates and silverware, cardboard, bags filled with trash that should have been set out for trash collection and adult items. Based on the cobwebs and dust in some of these units these items have been stored for several years which means that thousands of dollars have been wasted on storing these items.

Before you respond that this was the property of these people and represented the best they may have had, I am not judging them. I am saying that based on how long these items had been in storage they would have been better off financially taking this stuff to the dump rather than storing it. Maybe they had been storing it because they had to move into a smaller place. They could have saved the money they spent on rental fees and bought new items and new clothing when they were able to find a larger place to live. I've talked to people who bought units and tried to wash the molded clothes to resell. They were not salvageable. Pitching these items would have been financially a better choice than spending money each month to store them, and the people would have been able to purchase better items that what they were storing.

Tomorrow we'll look at another lesson about choices learned from studying storage units.

Financial choices

One thing the coronavirus has taught us is that many people didn't learn from the 2008 recession about personal financial management. Before you think I'm being insensitive or critical you need to know that in 2008 I owned a small business that closed. For about a year prior to 2008 we were losing money, but when everything crashed, so did our business. At the time I felt like we would be bankrupt before it was over. Fortunately, that did not happen.

One thing that did happen was that I was determined to never again be in that position. For much of our lives we lived paycheck-to-paycheck. Sometimes we ran out of money before we ran out of month. Living like that usually leads to deeper debt which means you are digging a deeper hole that is even tougher to escape.

I had a job that required a lot of driving so I began to download podcasts to my I-Pod to listen to while on the road. One of the podcasts I listened to was Dave Ramsey's on financial management. I have listened to thousands of hours of his podcasts since that time. After a while I knew what he was going to tell those who called in to his show with their financial questions before he told them. But, knowledge is of no value unless you put it into practice. We decided to do just that.

Ramsey's management plan follows what he calls Baby Steps. I won't go into detail about what each of the steps are due to space limitations. If finances are a problem for you I highly recommend his book The Total Money Makeover: Classic Edition: A Proven Plan for Financial Fitness. This book takes the reader through his steps for getting out of debt, building an emergency fund, paying for children's college and saving for retirement. I can tell you it works.

When this pandemic hit, businesses shut down and millions of people were out of work overnight. Immediately, the news was filled with people who didn't know how they were going to pay their bills, put food on the table and meet their basic financial needs. This told me that none of these people had any kind of emergency fund set aside for times like this.  One study earlier this year, before the pandemic hit, found that 70% of the people surveyed couldn't pay their bills if they missed one paycheck, and 44% reported that if they missed one paycheck they could not afford their housing. Again, I am not being critical. I've been there.

We choose how we are going to handle our personal finances. Some of us may have more or less finances to handle, but we still choose how we will handle what we have. When we go into debt to buy something, it is a choice we've made. When we spend all our money to have the latest phone it's because we chose to. When we take out a seven-year loan to buy a car we can't afford it's because we chose to do that. When we spend more than we bring in and have nothing in savings or retirement, again it was a choice we made. Then when something like this pandemic or a market crash happens we panic because we have nothing saved.

I've been writing about the consequences of our choices. This pandemic has shown us once again the consequences of living beyond our means and not saving anything. Many of us really need to look at the financial choices we've been making and decide if we need to start doing something different.