The Psychology of Hoarding and Its Impact On Personal Finance

Do you find it hard to throw away some possessions and things you haven’t used in a very long while? Is organising or categorising your items or possessions something you term as difficult? Chances are, you are a hoarder. 

What makes one a hoarder? 

Personally speaking, I own an oversized sweater I got when I was twelve that I still put on today, does that make me a hoarder? Does holding on to that wedding gift you got twenty-five years ago make you a hoarder? Maybe that thing was too big of a bargain or unique to just throw away. Do we hold on to things because of the “sentimental value”  or do we have “attachment issues"?

A friend of mine declutters her house every few months, giving and throwing away  things she hasn’t used in a while, her motto is “If I hadn’t used it in a while then I don’t need it.” That’s not my case, what if I need it in the future and don’t have it? What if I want to pass down my oversized sweater to my future children? I can’t throw it out just yet.

Hoarding is not all bad, for instance, one might hold on to an item to increase its value, but that’s not the kind of hoarding we are talking about. We are talking about that radio that died two years ago you haven’t thrown out because you are going to “fix” it or find some other use for it. I know I hoard things but not to the point of living in a house that is so cramped with clutter and disorganised piles of things that my corridor is too small I have to squeeze my way through to the next room. 

In some instances hoarding can go hand in hand with compulsive buying, buying stuff you don’t need online or in person. Those cute earrings you saw when you were leaving work. I comfort myself by saying a compulsive buyer makes a good wife.  I sat down and did a deep dive, a self-intervention, and realised that I cannot pass up a good deal, Ksh20 bob for a pillowcase? I will take fifteen, please!  You might never know when you will need them right? I cannot pass up a good deal and I end up with items I don’t need and yet don’t want to let go of. 

I have especially fallen victim to the buy one get one free sale, even when I don’t use or know the particular product being sold, as long as you have taped free on the side, I want it. But in the long run that has led to some devastating results on my finances. Wanting things outside my budget made me want or start to crave more money. With time I realised hoarding often leads to excessive spending on items that are not necessary or useful. I might feel the urge to purchase items  I don't really need, resulting in wasted money.  Luckily for me, mine was a minor case but imagine if it wasn’t? I might have ended up getting loans from friends and family to pay rent. Whether severe or minor this has strained personal finances and made it difficult to meet essential expenses or save for important financial goals. 

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Just to let you in on other cases of hoarding and its effects on one’s finances, here are some other situations other than my own.

William hoards items he believes are unique. He hopes these items will one day create extra income for him. When William collected just enough items and decided it was time to sell, he was ecstatic. He got his first client and invited him to his house but didn’t make a sale. His client felt overwhelmed after seeing so much clutter and complained about how William kept his things, some were dusty, dirty, or in poor condition due to being stored haphazardly. Reduced resale value was something William didn’t think of. Hoarded items may also lose value due to changes in trends, technology, or the condition of the items themselves. Even though he still hasn’t sold anything he has collected, William hopes one day he will. For now, he continues to collect and keep his things. 

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Hoarding items made it difficult for Lisa to take care of and maintain her home. Lisa recently moved into a bigger living space because her things were making her old place too cramped up with clutter to the extent that her things started to damage the walls and floors. She reasoned why spend money constantly repairing her old place when she could move into a much bigger space that would free up the clutter and give her more space to store her things? She now spends most of her income on rent and has paused her plans on pursuing additional income-generating opportunities for the moment.

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Mike grew up living in want. He saw his parents struggle to put food on the table and educate him and his siblings. As an adult, Mike does everything he can so he doesn’t end up in poverty. He is constantly saving money. Mike’s wife thought saving money for a rainy day was smart of Mike but over time, it was evident Mike wasn’t saving money for future use or emergencies but he was hoarding it. Mike is often hesitant to separate from his wealth even when paying for essential services. He has opened multiple accounts and accumulated so much money over time. Despite having the means and opportunities to invest or participate in potentially lucrative financial endeavors, Mike chooses to keep his money in his bank accounts and avoid any investment or business ventures altogether.

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Marie knows she has a hoarding problem, she has been hoarding plates, cutlery and so many other items that she began to feel overwhelmed with all the clutter. She decided it was time to donate and sell some of her things. She spent the next three days decluttering her house and preparing her things for sale at a flea Market. On the day of the sale, she sold her things at ridiculously high prices, resulting in very low sales. She reasoned that people didn’t see the true value in her things. With the amount of money she made, Marie ended up buying similar items to the ones she sold earlier and even buying items she forgot she still had.

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Alex is a visual artist that loves to collect newspapers, documents, and anything he can use to create his works of art. As a result of this, his apartment is filled with boxes and boxes of the most random things that he says will be valuable art one day. At the same time, Alex struggles to organise his bills and keep track of payment deadlines. He has neglected and sometimes misplaced important documents that have ended up on his art pile.  There was an instance, Alex wanted to return shoes he bought but couldn’t trace the receipt. He remembers putting it in one of his boxes but doesn’t seem to remember which one exactly. He spent hours looking through his boxes and flipping through old books but never found that receipt. On the bright side, he finally found his birth certificate! 

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