MW Amid the market carnage, I'm selling all my worldly belongings. How should I do this?

By Quentin Fottrell

'I'm not panicking over the turmoil on Wall Street or Trump's trade war, I'm just being practical'

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Dear Quentin,

I read your column quite often and very much appreciate the advice you give people. Sometimes writers have a valid quandary that your input might help. Perhaps I am one of those people. I'm not reacting to market carnage, I'm just being practical.

I'm 75 and my children are firmly established in their lives. My wife and I live in a suburban area in a large house, with a yard and all that goes with it. We want to close up shop, so to speak - not just downsize but move to someplace new.

Between us, we've lived overseas on and off for 60 years (although we're just recently married). My problem is I have all this stuff. The kids don't want it. I want to dispose of most of my stuff, sell the house and go on an adventure with a pied-à-terre in New York.

'We are fortunate to be in our mid-70s and not have our wealth locked up in stocks, especially given what's happening on Wall Street.'

I love culture, and would like to spend time in San Francisco, or some other distinctive locale, and keep experiencing life and traveling. But how do I divest myself of all my stuff? Some of it's just regular furniture, but a lot of it is collectibles from my travels over the years.

I have a collection of daggers from the Middle East, carpets from the Caucasus region and crystal glassware from Bohemia, plus china from Russia in the imperial pattern, not to mention semivaluable books, vases, clocks, artwork, etc. It's quite overwhelming.

I'll be sad to part with it, but I don't plan to leave it for the kids to sort out and have the same angst. And I don't want to take it with me, wherever that is. I'm not much concerned about getting fair value for it, whatever that would be.

I'm looking for your recommendations on how best to make sure my things go to a good home. I understand that no one will value it like I do, and we are fortunate to be in our mid-70s and not have our wealth locked up in stocks, especially given what's happening on Wall Street.

Is this a good time to downsize?

Collector

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Dear Collector,

It's not a bad time to downsize.

Good for you for going about your business as usual. You should, at 75, have reduced your exposure to the market and have a sizable amount of equity in your home. That way, you can experience the current market turmoil as an observer, for the most part. It's heartening to know that you are selling your home and looking to downsize because now is the right time, and that you are not trying to time the real-estate market. That would open up another world of anxiety for you during this time. Plus, you should feel comfortable having a cash cushion.

"We still think it's a great time to be invested and for those with money in cash, it represents an opportunity to put capital to work in longer-term assets," says Eric Freedman, chief investment officer for U.S. Bank Asset Management. "Timing the markets and trying to be precise on when to be in and when to be out is challenging. Investors should be aware there's a lot of noise. We urge clients to take a deep breath, go back to your plan. That will increase your odds of success."

For those who are nearing retirement, have just retired, the response of markets to Trump's tariffs is concerning.

You may have an easier time selling than buying. Housing demand has failed to keep up with supply and millions of homeowners who are locked in at mortgage rates below 5% are, understandably, reluctant to sell and settle for a higher mortgage. The shortage is not helped by a peak in interest from institutional investors. The National Association of Home Builders recently said the housing industry continues to experience "elevated building material costs that are exacerbated by tariff issues, as well as other supply-side challenges that include labor and lot shortages."

For those who are nearing retirement, have just retired, the response of markets to President Donald Trump's tariffs is concerning. They must feel like the world has turned upside down. This week will be also rocky: The S&P 500 SPX, the Dow Jones Industrial Average DJIA, tech-heavy Nasdaq Composite COMP and the small-cap Russell 2000 RUT RUT are all expected to have a bleak Monday. In fact, Thursday and Friday marked the worst two-day performance for all these indexes since March 12, 2020.

By your 70s, you should have no more than 30%-50% of your savings in equities, according to T. Rowe Price. This, in theory, should protect against the kind of market correction we are currently experiencing, at least according to the "120 minus age" rule. That rule of 120 stipulates that you can subtract your age from 120 to give you an approximate, sensible weighting in equities that would match your age. (It's also known as the "100 minus age rule," so opinions on that differ. It's meant as a guide.)

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Tax consequences of selling stuff

And so to the issue at hand: Your quest to rid yourself of your worldly belongings, and hopefully give them to a good home. It takes a lifetime to acquire stuff, but it takes less time to get rid of it - in theory, at least. You can sell collectibles at a profit with the help of an auction house, but be prepared to pay tax if you make money. Contact a local auction house or the National Association of Auctioneers. Failing that, you can have a garage sale, and post about it on your local neighborhood forums.

Like many people, I'm constantly amazed by how much I appear to accumulate just by standing still. Every five years or so, I do a cull, starting with one large black garbage bag a day. Don't put yourself under too much pressure. If you don't want to part with that china from Imperial Russia or certain artwork, park them in a storage facility and resolve to revisit it in a year's time.

"You'll make the most money by matching your goods with the best places to sell them, whether it's an auction house, a consignment store, a website or a yard sale," according to Consumer Reports. "Just keep in mind that the IRS may want a cut of your profits. It taxes the proceeds from the sale of collectibles as capital gains, generally at a rate of 28%."

"Under IRS regulations, collectibles include works of art, rugs, antiques, metals (such as gold, silver and platinum bullion), gems, stamps and coins," it adds. "Your profit or loss is the difference between the basis, usually your purchase price, and the sale price. If you end up selling your goods at a yard sale, however, it will likely be for much less than you paid for them."

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View from an expert

Andrew Mellen, author of "Unstuff Your Life," has some suggestions of his own for divesting yourself of these belongings. "Approach auction houses with your collections and see if they are interested in some or all of your things," he says. "You'll want to send them as many details as you have, including provenance and photos."

Of the auction houses, he suggests the usual suspects: Rago, Doyle, Christies, Sotheby's, Bonhams and Swann Galleries. "If they are not interested, you have at least three other options," he notes. Firstly, "list the items yourself online at sites like Chairish and Hunt Vintage." Alternatively, hire a reseller to do the listing for you. Or, donate them to museums or galleries instead.

"Donating them would give you a tax deduction and, again, they'd be more likely to end up in the hands of people who appreciate them," Mellen adds. Listing the items yourself requires the most work from you and the least guaranteed results. "You could spend considerable time listing your items with care, only to see them possibly languish online with less interest and few sales."

The memories, he says, will remain even when the possessions find new homes. "As you lighten your load with the focus on traveling and continuing to explore the world, lean into how easy it will be to move around the globe without the weight of so many beautiful, but no longer useful, belongings," Mellen says. And, yes, you have saved your children a lot of work.

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Charitable donations

Facebook Marketplace $(META)$, I have found in recent times, can be more useful than eBay $(EBAY)$ because you are typically dealing with people who live nearby and who are willing to pick up the belongings themselves. With eBay, be careful about listing items as "pickup" or "delivery." The latter can be even more stress and work than listing it in the first place.

Be prepared to donate a hefty amount of tax-deductible goods. Habitat for Humanity can be quite picky about what they accept, but there are other organizations in cities like New York that are willing to accept an array of goods - including Housing Works, which also offers pickup for certain pieces of furniture and antiques for a fee, if your offerings are in good condition.

Assuming you have a lot of cash to play with, you will have options about where to store it.

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