Is Your Cluttered Home Keeping You in Debt

You have a wardrobe full of unworn clothes, a storage room full of boxes, and piles of receipts, unopened credit card statements, and bills.

Does this sound all too familiar in your household? While it’s hard to tell which comes first, researchers, debt counsellors, and professional organizers alike point to a correlation between debt and clutter.

“Debt and clutter seem to go hand in hand. To fill a house from floor to ceiling with your possessions, that takes money, and sometimes you’re using money you don’t have,” says Rhea Becker, a Boston-based professional organizer.

“Clutter goes far beyond being just a physical obstacle around the home. It weighs on your mind, it comes with stigma, embarrassment and shame, and it affects your mental and physical health. It wears you down and this may be really similar feelings to carrying debt,” she says.

Why Clutter Creates Financial Problems

Debt and clutter around the home are intertwined in many different ways, says Kathryn Bossler, a financial counsellor at GreenPath Debt Solutions.

“When we speak with clients and understand their root issues with debt, a common source is not having a clear organized plan with their finances. This could be the simple logistics of not having a system of when to pay the bills and where to keep the bills,” she says. “It’s very likely this can lead to an accumulation of debt.”

When you lose track of your mail, you’re not just missing birthday cards and junk mail. You’re misplacing credit card statements, which can result in late fees on top of interest. You may even forget how many credit cards you have, resulting in closed accounts and collections agencies knocking down your door. You’re also misplacing appointment notices, which can lead to cancellation fees, and even your shopping, resulting in the re-purchase of items.

Becker sees these narratives often. “People kind of go overboard. Inevitably, they express surprise at the things they find when they go through their piles of clutter – they don’t remember purchasing some things, and it’s very common that they own two, three, or four of the same item,” she says.

The Emotional Strain of Clutter

The duo – of grappling with finances and continuously accumulating possessions – is also tied to lack of control and stress in managing everyday tasks.

Chicago-based researchers out of DePaul University studied the ramifications of a cluttered home and discovered that an overabundance of “stuff” could lead to procrastinating – avoiding responsibilities and everyday tasks “strategically and purposefully.”

These tasks could include keeping on top of bills, staying organized with a household budget, or monitoring progress with debt repayment goals.

In a 2017 study, published in the journal Current Psychology, the research team asked volunteers to answer statements like “I pay bills on time” using a five-point scale, ranging from “strongly disagree” to “strongly agree.”  Those with cluttered homes were  less likely to say “agree” on these tedious, but necessary tasks.

Respondents with cluttered homes were also more likely to agree with statements, such as “I have to move things in order to accomplish tasks in my home,” emphasizing the difficulty involved in running a healthy household when clutter is involved.

“The more clutter you have, the more likely you are to be a procrastinator, which makes sense because you’re unsure of what to get rid of…it’s a maladaptive lifestyle. [Procrastinators] do it at home, school or work, and in relationships and with responsibilities. They are always delaying, it’s very frequent,” DePaul University psychology professor and study co-author Joseph Ferrari said in a university press release.

It’s not only debt you have to worry about.

In a separate study, Ferrari and his team found that attachments to our homely possessions could lead to clutter and hoarding, ultimately compromising a sense of home and a healthy routine.

“You stop seeing your friends, you stop seeing your family, you don’t work as much. As clutter grows, and as it demands more attention, everything else that’s important gets forced out of your life,” Ferrari said in a statement.

Other research has pointed to links between making healthy eating choices and donating more money when in a healthy home, to carrying excess weight and dealing with more medical issues if you’re grappling with debt or a messy household.

The True Cost of Clutter

You’re sure to feel some sticker shock when you tally up the expenses involved in keeping a home full of clutter.

An article featured on the website of the AARP suggests the more people accumulate, the more they feel crowded and upsize to a bigger home. Certified professional organizers in the piece estimate that a family that’s purchased a 2,000-square-foot home for $300,000 is typically spending about $15 per square foot to store old belongings. Families need to consider how much of their home they’re actually living in, instead of just using for storage. They estimate that most family homes could free up about 20 percent of their space.

Not only are people who are prone to clutter living in bigger, more expensive homes, but they’re renting storage units to store even more stuff. The average cost per square foot of storage is $0.97 per month or about $96.09 for a 10’ x 10’ storage unit. Over a year, that’s $1,152.72.

But industry statistics suggest 65 percent of Americans who rent self-storage units already have a garage in their home, while 47 percent have an attic or a basement to fill – plenty of storage space to work with within their property.

And then there is the cost of organizing, moving and paying professional removal companies to dispose of unwanted possessions. These expenses could increase the long-term cost of clutter by the hundreds.

Becker noted that in some instances, families buy in bulk to save money but ultimately end up with too many products in the home that take up space and even pass their expiry date.

This could result in spending more than they’d saved after factoring in storage, cleaning, and removal costs, and of course, spending more than necessary on items that ultimately end up getting tossed. These expenses could be exacerbating an already existing problem with money and debt management.

How to Keep Your Home- and Finances- De-Cluttered

If you’re a homeowner with a house full of things, you may feel like decluttering your home is an insurmountable task. It’s not.

Regardless of the size of your home, you and your family can take on the challenge of tidying up the clutter and getting organized, experts say. Here’s how to get started:

Start Small

Start by organizing a small space that’s negatively impacting your day-to-day, says says Lisa Ruff of the NEAT Method, a luxury home organization company with teams across the United States. Are your fridge, freezer and kitchen pantry a mess, making cooking family meals a nightmare?

Choosing one spot to focus on first provides a positive snowball effect that will motivate you to keep going on the rest of your home, Ruff says. Breaking the task of organizing your home into smaller chunks makes the project seem much more approachable, too.

“It’s helpful to start small, like a drawer or cabinet, because you won’t be as overwhelmed. It’s also easier to find the time to finish a smaller space,” Ruff says.

Remember, it’s not just organizing; you may also need to run out to make donation drops for items you no longer want. You need to earmark enough time to completely finish the project or else unwanted items will slowly creep back in.

Consider Tidy Decor

Small adjustments such as choosing simpler furniture, applying a fresh coat of paint to your walls, and putting in new flooring can breathe life back into your cluttered home.

These careful touches can give you a fresh start with how you curate the rest of your home.

Think of the big picture: when you walk into a room, you don’t want to be inundated with too many things to focus on.

“White space – or negative space – is important for all homes. Creating white space allows your eyes a rest, creates a sense of calm and ensures easy access to items,” Ruff says.

Don’t Pack Too Tight

Resist the urge to fill a closet or shelving to capacity – instead, aim for being selective in what you keep in your home, on your walls, and on your bookshelves and cupboards.

You don’t want spaces brimming with possessions. If there’s plenty of space to grab an item and easily put it away, you’ll be more likely to put it back in the correct spot instead of shoving it wherever it may fit, Ruff says.

Use organizational products, when possible, too.

“A little can go a long way. For example, coordinating hangers in a closet are a quick way to make a closet look more organized. The more aesthetically pleasing you make a space, the more likely you’ll keep the organizational system up,” she says.

Take a Picture of It

If you’re getting sentimental over possessions that come with some nostalgia, like that old t-shirt from summer camp that’s peppered with holes or your old roller skates collecting dust, take a picture of these once-prized possessions you’re having a hard time letting go.

Research out of Penn State University in 2017 found that people were 15 to 35 percent more likely to donate their old belongings and declutter if they simply took a picture of the items first.

“What people really don’t want to give up is the memories associated with the item. We found that people are more willing to give up these possessions if we offer them a way to keep the memory and the identity associated with that memory,” Rebecca Reczek, study co-author and marketing professor, said in a university release.

The study, published in the Journal of Marketing, was inspired by a researcher’s love for an old pair of basketball shorts tied to the memory of when she won the winning game in junior high. Hanging onto an old picture from the game was enough to help her part ways with the item.

Organize Your Finances and Budget

Knowing that debt and clutter overlap provides you with some wisdom on how to change. Create a designated space for your bills and earmark a specific time each month to sort your finances.

Bossler says some clients come in with boxes full of unopened bank statements, credit card statements and other bills. Counselors work with their clients to open them one by one, dispose of the envelopes and the additional clutter, and create tidy piles for each outstanding account.

“The problem can feel so much more approachable after taking this step to organize. Someone financially healthy will have a clear system in place and habits around when they pay bills, where they’re kept and how they organize them,” she says.

If your possessions each have a designated spot in your home, each dollar of your income should be organized somewhere on your budget too, Bossler says. Budgeting is especially essential for people who overspend on discretionary items, adding to their clutter in their homes.

“There’s a link between an organized home and organized finances. Budgeting really helps you put a limit on what you’re allowed to spend – it organizes your thoughts on what to do with your money,” she says.

“Disorganization impacts every facet of your life – from forgetting to pay bills to arriving late to work. Implementing organizational systems can help reduce stress as you move through your daily routines and save you time because you can access the items you need when you need them,” says. “It also cuts down on consumption. As items are more visible and easier to access, you know what you have and don’t needlessly purchase more.”