November 3, 2015
What are you going to do with all your "stuff" when you retire? Years of furniture, souvenirs, great deals, and collections add up over time.
As you get closer to retirement, it is smart and efficient to develop a strategy for your belongings. Whether you're planning to downsize, want to see your children enjoy certain items now, or simply have more time to take inventory developing a plan for your things will save many headaches in the future.
While your heirs may appreciate the quality of your Wedgwood china, antiques, and collectibles, they may not want your dishes, furniture, or rare book collection. Be sure to talk with them about any objects you assume they want - you may be surprised by their answers.
Selling some of your items now might be a good option. This may give you a modest financial bump, make it easier for your heirs to manage your property, make it easier to move, or de-clutter your retirement home.
Step 1: Evaluate Your Goods
Start by seeking out a professional. Ask your Investment Professional and estate planning attorney for appraiser referrals, and check in with friends and family for recommendations.
After you get a list of candidates, meet with a few of them to see how they propose valuing the items you'd like to sell. If you have standout items such as valuable art or rare coins, ask a specialist to appraise those separately.
Estimating ballpark values help you set realistic expectations for possible profits.
Step 2: Prepare for Sale
Know what's "in." Styles and tastes change. That handcrafted cherrywood Queen Anne dining set you think should draw $15,000 might only fetch $1,500 at auction if mid-century modern maple is popular at the time.
Some items gain greater value if you have them repaired before sale. Ask your appraisers what they recommend.
Step 3: Decide Where to Sell
After getting an item's market value, consider whether to sell at auction, hold an estate sale, or put them on consignments. Time, commissions, fees, and transportation are all factors to consider.
Taking time to evaluate your options can help you choose methods that work best for your overall strategy.
- Option A: Sell at Auction
A rare and attractive antique, painting, or grand piano, for instance, might be maximized at auction. But auctions take time. The turnaround for consigning items to an auction house could run several months.
- Option B: Hold an Estate Sale
Estate sales allow you to sell a wider range of items, from valuable antiques to smaller collectibles. These events are typically staged in your home, so make sure you're comfortable inviting the public through the front door.
An estate sale manager can help plan the sale and take precautions to secure personal items -- such as financial documents -- before the event.
- Option C: Consign Some Items
Selling by consignment without an auction is another option. Shop around for vendors. Some sell from stores, while others hold events at various locations.
Compare contracts, fees, and commissions because they can vary. Many antique stores take consignment items. Visit several stores and talk to the staff to see what would be a good fit for your treasures.
Step 4: Manage the Proceeds
However you approach selling your heirlooms, keep in mind you're not the only one who would like to profit. Estate sale liquidators may charge a commission, depending on the value of your items and the difficulty of the sale.
If you receive any profits from your sale, work with your Investment Professional to decide how to put the funds to good use. Will you shore up your cash cushion, prepay a vacation, or make a donation to a favorite charity?
Whatever you do with your profits, knowing you've pared down your estate, de-cluttered your home, and discovered what your children value can be a good experience for your entire family.
Caroline Hill, Financial Advisor
(This article contains the current opinions of the author but not necessarily those of Brighton Securities Corp. The author's opinions are subject to change without notice. This blog post is for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities).