- Estate sales happen for several reasons, including downsizing or the death of a loved one.
- You can hire a company to manage your estate sale for you.
- You will make and keep more money if you run your estate sale yourself.
- The proceeds from your estate sale can help fund your retirement.
What Is an Estate Sale?
Your estate is the collection of assets that make up your net worth, including real estate, furniture, bank accounts, cars etc. Estate planning is a way to organize what will happen to each of these assets upon your passing.
An estate sale liquidates many of these assets by selling them. You might have an estate sale when you decide to downsize, after a loved one has passed on, before a divorce, or if friends or family move to a retirement home. Estate sales are similar to yard or garage sales but typically much larger in scale.
An estate sale occurs when the personal property and possessions of an individual are liquidated. Usually, this occurs following the death of the property owner. However, in some cases, it occurs while he or she is still alive as a means of downsizing and generating investable cash proceeds.
How Do Estate Sales Work?
Every estate sale is run according to the seller’s preference. Usually, they’re held at the home of the person whose items are being sold. Items for sale are marked with price tags so shoppers can browse at their leisure. When they’re ready to purchase, buyers find the person holding the estate sale and pay for the items.
Some might choose to pay a company to run an estate sale on their behalf. While hiring an estate sale company can alleviate much of the work involved, professional estate sale companies typically charge a commission of 40% to 60% of the sale proceeds. Holding an estate sale yourself can be labor intensive, but you will retain more control of the process and keep a much greater portion of the profit.
Why Should You Hold an Estate Sale?
Holding an estate sale can benefit someone in many ways. Each person may have a different reason to hold an estate sale, but below are some of the more common reasons.
Why Hold an Estate Sale
- Clearing out possessions and furnishings you no longer want or need when downsizing
- Raising money that will extend the longevity of your retirement funds
- Adding to the nest egg that will help you anticipate the costs of future health care
RMDs: The Retirement Advantage You Can’t Afford to Miss
How to Hold an Estate Sale by Yourself
Organization is key when it comes to holding an estate sale. You’ll want to give yourself plenty of time to sort, stage and advertise your sale to ensure maximum success. The following tips will guide you through the process. We’ve also created a handy timeline and checklist for quick reference.
1. Create and Sort Your Inventory
The first step is to decide on your inventory. It’s important to know exactly what you want to sell, keep or give away. That way you can plan for items you won’t be selling, such as when you’ll get them out of the house or how you’ll mark them “not for sale.”
Once you have the entire inventory sorted and categorized, you’ll have a better idea of how much time you need to prepare. Then you can choose a practical date (or dates) for the sale.
2. Prepare Your Estate Sale Inventory
Many items will have a low resale value, but even small items can have an impact. A group of 50 small items only worth a few dollars each can still earn you several hundred dollars. Other larger Items can bring in a more substantial amount of money, especially if they are properly touched up beforehand and well displayed.
Take the time to dust, polish and make reasonable repairs. If personal valuables are cracked, broken or missing pieces, they may not be worth fixing. Inspect items with a critical eye before investing time, effort or money in repairs.
3. Price Your Items
When it comes to pricing items for an estate sale, it is imperative to do your research. If you set your prices too high, you may lose selling opportunities. Pricing too low means you lose out on valuable returns.
Check sales sites like Craigslist, Facebook Marketplace and eBay to see what similar items sell for. For valuables like jewelry and antiques, a professional appraiser can help you land at the most appropriate price.
Ensure all the items for sale are marked with their designated price and that any items not for sale are marked as such. This will free your time during to help buyers make their purchases. If you’re unsure what to use for marking prices, you can download our printable price tags.
4. Display Your Items for Sale
Proper display can make all the difference in an estate sale. If you leave large items like dressers, chairs or desks in the garage, they may be overlooked. Stage them well so potential buyers can better visualize their value for their own homes.
Consider grouping similar items together for potential buyers to see all at once. This way you can also group them at the same price, eliminating the need for excess price tags. This strategy works well for items like books, DVDs, plates, fabrics and more.
5. Set Yourself Up for Purchases
When you know what’s for sale and how you plan to stage it, consider the layout of your items. You want to ensure a smooth traffic flow between rooms so buyers can comfortably browse without feeling cramped.
Set up a cash table and plenty of visible signage so buyers know where they can make purchases. If you have sales assistants, have them all wear the same shirt or vest so they’re easy to identify. Be sure to have a proper float of bills and change before you start.
Decide ahead of time how you will handle checks, credit cards, Venmo or CashApp payments. Today many customers rely on electronic payments, so it’s important to have a plan. You may also want to rent or purchase a mobile credit card reader.
6. Take Security Measures
Since an estate sale generally takes place in a home or large space, it’s a good idea to take added security precautions. Have helpers in place to monitor rooms, entrances and exits in a friendly and courteous manner to keep buyers from feeling uncomfortable.
Be sure doors and windows remain locked and closed before the sale begins to keep people out of the house and protect your items from being stolen or damaged.
7. Check Local Restrictions
Some neighborhoods or homeowner associations require you to fill out an application or acquire a permit before hosting an estate sale. Be sure to check your municipal and local HOA websites. It’s also smart to check if there are any distancing health measures you must take.
Some municipal organizations will forbid you from putting up signs or distributing fliers. If yours doesn’t have such restrictions, post signs for the sale and for parking availability. Follow any local parking guidelines as appropriate.
Advertising your sale is key. Let everyone know when and where your sale will take place, along with what types of items will be available.
Cost-Effective Ways To Advertise Your Sale
- List your estate sale on Craigslist or social media sites.
- Take photos of more valuable items and put them online with your posting to attract more potential buyers.
- Put up signs around the neighborhood with directions on how to get there.
- Post plentiful signs around the neighborhood with the date and directions.
- Spread the word among your neighbors and any groups you belong to.
- Pass out fliers, with the time, date and directions.
Let’s Talk About Your Financial Goals.
Have a Plan for Items That Don’t Sell
Though the hope is that you sell every single item, it’s likely that you will finish your estate sale with some items still on hand. Before you start, plan for how you’ll handle any leftover items. You might make donations to thrift stores like Goodwill or local charities. With enough incentive, some charities may even pick up items directly from your location.
Be aware of which items can be recycled, which can’t, and which require special disposal, like electronics. Your municipal website should have some advice for you on that score. The Environmental Protection Agency lists companies that accept old electronics for recycling.
How to Handle an Estate Sale In Different Situations
Estate sales are not just larger than garage sales, they are also more emotionally significant. They often follow the loss of a loved one or the progression from one phase of life to another. It can be difficult to let go of personal possessions while also handling a wide variety of emotions. These tips may help.
It’s for a Loved One Who’s Passed On
It’s particularly difficult to stage an estate sale following the death of a loved one. It can be challenging to organize so many moving pieces during grief, both your own and that of other family members. Going through a loved one’s personal belongings can stir a great deal of emotion, which can reveal itself in surprising ways. EstateExec found that almost half of their survey respondents were aware of family conflict during the settlement of an estate.
After distributing any bequests specified in the will, you might choose to allow family members a chance to claim a personal memento, whether by lottery or simply on a first-come, first-served basis. Clear out any personal toiletries or medications, taking care to properly dispose of the latter. What’s left after that will be the inventory for the estate sale.
You’re an Empty Nester Downsizing
It’s hard to pack up an entire home, harder still to decide what to keep and what to leave behind. You might want to ask a friend to help you sort through your things to determine what you truly need and will have space for in the next phase of your life. Make a list of reasons you’ve decided to downsize and refer to it whenever you feel the urge to stockpile old possessions.
As part of your planning for your downsizing estate sale, decide what you will do with the proceeds. Any earnings can become part of your retirement planning. You might invest in an IRA or use the money to purchase an annuity.
What To Do After an Estate Sale?
Once your estate sale has been successfully completed and any remaining items are dealt with, you can decide how your plan to use the money from the sale. Some estate sales aren’t complete until the house itself is sold. Depending on the amount raised, you will have several options for the resulting funds.
If you’ve sold a house, you’ll likely have a substantial amount with which to make plans to secure your financial future. Annuities are another great way to provide continuous and guaranteed income for your retirement.
Although the process may be laborious, an estate sale can help you move forward, whether that means working through the grief of loss or setting yourself up securely for a new stage of life. The more organized you are, the more smoothly the whole process will proceed.