Many people who rent self-storage units initially anticipate using them for only a short period of time, usually a month or two while they move or renovate. However, the actual rental duration often extends beyond their initial expectations. There are also some huge tax benefits to buying or financing a shipping container vs renting a storage unit. The following is a quick breakdown we put together to help you save money.
Expected Duration vs. Actual Duration:
- Expected: Many renters might expect to use the unit for a few months, coinciding with specific life events like moving, renovating, or decluttering.
- Actual: As mentioned, the average length of stay for customers in the self-storage industry is approximately 8.5 to 9 months, but many renters end up staying for years.
Reasons for Extended Stay:
Procrastination: One of the biggest reasons is simply procrastination. Since the items are out of sight, they're also out of mind. This can lead to renters forgetting about their stored items or continually pushing off the task of emptying the storage unit.
Life Changes: A person's circumstances can change, such as moving to a smaller place than initially anticipated, extending the renovation period of a home, or unforeseen events that keep them from accessing or emptying their unit.
Economic Factors: Economic challenges might cause individuals to downsize or live in transitional housing longer than anticipated. Their belongings stay in storage until they're in a more stable situation.
Emotional Attachment: Even if items in storage aren't being used, people may have an emotional attachment to them. The thought of sorting through and potentially discarding or selling items can be daunting.
Convenience: Some people get used to the convenience of having extra storage space and decide it's worth the cost to keep some items stored away even if they don't need them in the immediate future.
Cost Perception: The monthly cost, while an added expense, might be seen as manageable. Over time, however, these costs add up, and the renter might spend more on storage than the stored items are worth.
Optimism Bias: At the start, renters might be overly optimistic about how quickly they can move, renovate, declutter, or otherwise handle their belongings. As time goes on, they might find that their initial timeline was unrealistic.
To mitigate extended, unintentional storage rental, customers can:
- Regularly review the contents of their storage unit.
- Set reminders or deadlines for themselves to clear out their units.
- Weigh the cost of storage against the value (both monetary and emotional) of the stored items.
- Avoid using storage as a long-term solution for items they don't truly need or want.
Hindsight is 20/20, but you might have been better off buying a 20' shipping container.
It might seem simple, but those monthly costs add up fast.
- Total Cost Over 1 Year:** $3,000
- Total Cost Over 2 Years:** $6,000
- Total Cost Over 3 Years:** $9,000
- Total Cost Over 4 Years:** $12,000
- Total Cost Over 5 Years:** $15,000
And this painful and costly cycle continues for as long as you rent.
Buying a Shipping Container Outright with STLBX
Make a one-time payment and secure endless storage benefits.
Total Cost:** $4,500 (one-time, forever yours)
Financing a Shipping Container through STLBX
Obtain your container now with the convenience of spread-out payments.
At a competitive 12.99% interest rate for 48 months, your monthly payments will be approximately $120.68 and this is what we used for this example.
Here's how it plays out:
- Total Cost Over 1 Year:** Approximately $1,448.16
- Total Cost Over 2 Years:** Approximately $2,896.32
- Total Cost Over 3 Years:** Approximately $4,344.48
- Total Cost Over 4 Years:** Approximately $5,792.64 (Container fully paid off!)
- Total Cost Over 5 Years:** Still $5,792.64 (since you've completed the payments by year 4)
Self Storage Financial Perspective
Storage Unit: By year 5, you'd have spent $15,000 with nothing to show for it.
Shipping Container Purchase: $4,500 upfront and the container is yours indefinitely.
Shipping Container Financing: By year 5, you've spent just $5,792.64 and have owned your container for a whole year with no extra payments.
The Value Proposition of a Shipping Container:
- Perpetual Benefits: Once you've bought or completed your financing, the container is yours with zero additional costs.
- Freedom & Versatility: Position your container where you want and use it as you see fit.
- Exceptional Security: Premium, durable containers from STLBX offer optimal security.
- Spaciousness & Ease of Access: Organize and access your container as you please without restrictions.
- Return on Investment: Should your needs evolve, containers retain solid resale value.
Elevate Your Storage Game with STLBX
Five years into renting a storage unit, you would have spent $15,000 with no end in sight. With STLBX, you can own a solution by year 4 for a fraction of that cost.
Centrally located in Victoria, BC, and Ottawa, Ontario, we're here to facilitate your transition to smarter storage.
Note: All calculations are based on the 12.99% interest rate for 48 months. The exact figures might vary due to rounding or specific loan nuances.*