When I wrote about monitoring your net worth several months ago, I pointed out that gathering information about your home inventory is one of the toughest things to do accurately and thoroughly. One of the reasons is simply because we’ve accumulated so much “stuff” that to keep track of it all would take an enormous amount of time.
I would encourage you to apply the 80/20 principle to your home inventory as you read through some of the reasons below. In other words, tracking 20% of what you own should account for the most important 80% of what you need to track. Going above and beyond and trying to keep tabs on every book, pair of socks, or box of pens that walks through your doors will drive you crazy.
Why You Should Track Home Inventory
If you’re net-worth-oriented, you may consider the value of your home inventory important only for inclusion in your assets column. But there are many other benefits to tracking what you own. Here are a few of them:
- Insurance Claims – If you need to make a claim after theft, disaster, or damage, it’s already too late to start looking for records which may or may not exist. The best time to create these important records (receipts, warranties, photos, etc.) is right now.
- Insurance Coverage – Many insurance coverages, particularly renter’s insurance, require you to pick a level of coverage corresponding to the level of protection you need. This is based primarily on the total replacement value of your home assets. Having a well-completed home inventory allows you to ensure that your coverage meets your needs.
- Making Moving Easier – During our last family move about three months ago, I realized the importance of having an inventory list. It made preparations for the move much easier – from planning where our things would be stored in the new apartment to assisting with boxing and the move itself.
- The Great Search – One of the by-products of having so much “stuff” is that we frequently lose track of things and have to organize search parties with your entire family. Inventory programs have the capability to organize possessions by room or space, so that finding something buried in one of your closets becomes a little easier.
- Maintain Accurate Records – How many of us can say we know exactly where the important records for our purchases are located? If your television breaks tomorrow, would you be able to locate the warranty information and receipt of purchase? Chances are that without a home inventory system and corresponding filing system, these records get lost in the paper shuffle at home and won’t be there when you really need them.
Home Inventory Tracking Tools
Here are two effective and reliable tools for tracking your home inventory:
- Quicken Home Inventory Manager – The latest version is 2008. Some of the benefits include being able to have an actual “file” you can take with you and back up, being able to integrate with Quicken directly, and a comprehensive and customizable interface. Some of the downfalls (I have used this software in the past) include installation and re-installation problems and file backup/restore, and inability to keep open while Quicken is operating. For $30, I would say it’s a pretty good value. Screenshot:
- Know Your Stuff – This is a free alternative, operated entirely online, from the Insurance Information Institute. The nice thing is that information is available anywhere you go, so you never have to worry about downloading files or backing things up in case of a catastrophe. A short sign-up process gathers all your important information, and you’re ready to inventory! Entering items takes a little getting used to, as the form is online, but it’s no “clunkier” than doing it on the desktop. Screenshot:
Photo by The Pug Father