Do You Have Hidden Cash in Your Closet?

A piggy bank hiding in a clothes drawer.

Do You Have Hidden Cash in Your Closet?

Over the last few months, many of you have done an amazing job of reorganizing your closet. Now it’s time to figure out what to do with the extra clothes you no longer need or want.

After all the work you’ve put in making your closet look amazing, it’s time to put your closet to work for you!  A famous person once said, “Ask not what you can do for your closet. Ask what your closet can do for you.”

You never know. Your closet may be hiding cash you never knew about.

Who What Wear reports that the average woman probably has between $1,000 and $2,500 worth of clothes and shoes that she won’t miss. That’s a serious amount of money that could be spent on all kinds of things. You could even use it to buy more clothes or upgrade your closet!

Learn how you can turn your closet into your own private cash cow. And not all of the ways involve clothes.

Consider Consignment

One of the first ways to turn your closet into cash is through consignment. Consignment can be a wonderful way to ensure you’re getting top dollar for your items and know that your beloved clothes are going to a good home.

Unlike other places like pawn shops, you don’t get paid immediately when you give your clothes to a consignment shop. Instead, the consignment shop agrees to accept your items and sell them for you in their store. If and when the item sells, you get paid, and the shop keeper keeps a piece of the sale price.

Putting your clothes in a consignment store can be a great way to get your clothes in front of potential customers. Online consignment shops like the RealReal and Poshmark are wonderful ways to make money on your lightly-loved designer goods.

Reports show that secondhand clothing is more popular than ever, so it’s a great time to be a seller of quality, secondhand goods. However, unless you’re dealing with designer brands that you’re confident will sell, it may take at least a month or two before you see any money.

Donations Can Be A Tax Deduction

Do you have quality clothes in good condition that may not be right for consignment? Don’t throw them out! Those old clothes can still turn into serious savings on your next tax return. You should seriously think about donating them to your local thrift store or a worthy charity such as your local Goodwill, Salvation Army, or veterans charity.  As long as your items don’t have holes or stains, you can feel great about donating them and someone will benefit from your generosity.

When you donate your clothes, make sure you don’t just throw a bunch of clothes in a bag and call it a day. As you put together your donation pile, keep a list of what you’ve included and a general idea of what it’s worth. This “fair market value” will be useful later.

After donating your clothes, the store will give you a receipt for you to itemize your donation on your next tax return. A lot of the time, the charity won’t fill this out for you. That’s where the list you made comes in handy. Add up the fair market value of your clothes and use that number on your receipt to deduct it.

What’s more, many thrift stores are non-profits that do a lot to help their local communities. Donating to these stores can be a great way to clean out your closet and get a tax deduction while also giving back.

Sell Your Stuff Online

The internet has opened a whole new world of options when it comes to selling your stuff. Popular auction sites like eBay have been a great way to earn extra cash for a long time. There are even sites specifically designed for selling or renting clothes.

Whether you’re getting rid of designer clothing you never wear, or lightly-worn children’s clothing your kids have outgrown, there are all kinds of ways to profit it from it on the internet. You can choose to go with the online auction route or even try selling your clothes directly through social media on Facebook Marketplace.

The downside of selling online is that you’re going to have to package and ship those clothes once they sell. It can be a lot of work, and it could become a job in itself, depending on how many items you’re selling.

Try a Yard Sale

You know you want to sell your clothes, but you don’t want to deal with the hassle of doing it online. If that’s the case, then you should have a yard sale! When everything must go, there’s nothing like a yard sale to get rid of it.

With a yard sale, there’s no paperwork, shipping, or driving involved. All you need to do is set up your stuff on the lawn and let the people come to you! The downside to a yard sale is that you might not get as much for your clothes as you would selling them online or through consignment. Even so, yard sales can also be a lot of fun for the whole family.

Let Closets by Design Upgrade Your Closet

The first step in making money from your closet is to get it organized and cleaned out. Having trouble seeing the hidden potential in your space? Schedule your free in-home consultation with the professional designers at Closets by Design, and learn how you can transform your home while also making some extra money!

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