Author Archives: BetCrooks

Money for Nothing: 3 Good and 3 Bad Reasons to Rent Storage Space

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I haven’t had time to watch much TV, but I did see an episode of Storage Wars and it reminded me why I think Storage Lockers are a great way to make money—if you are in the business of renting them.

Written: 2014
Reviewed: 2023

Recently, it seems like rental storage units are being built faster than condos blocking the view of Lake Ontario in Toronto. Apparently, after a hundred years of managing to keep our possessions jammed in storage sheds and dangling from the rafters of our garages, we have given up and started outsourcing our storage needs.

Would You Contribute $50 a Month More to Your RRSP, RESP, TFSA or Investment Account?

Why don’t you sign up today to contribute $50 more a month to your future? What? You don’t think that would be easy? Then why do you think it’s ok to spend $50 (or more!) a month for storage?

You won’t ever get your storage costs back, either. At least if you’re putting them into a savings program, it’s your own money and you should see it again some day. So think long and hard about why you’re getting storage before you sign that lease.

Three Reasonable Uses for Storage Lockers

There are a few times when renting storage actually makes sense, provided it’s at the right cost and it’s secure.

Clearing out a House to Make It Sell Faster and for a Higher Price

Real Estate Agents will tell you that a crowded, cluttered home is harder to sell. It’s true. If someone can see at a glance that you don’t have enough cupboards and cubbies, they may well walk away. However, if your home looks like it must have tons of space, since there’s nothing on the counters and both cars fit comfortably in the garage, you may end up witnessing a beneficial bidding war.

Renting storage to temporarily store bikes, lawnmowers, empty suitcases, exercise equipment and other bulky eyesores may payout dividends.

Temporarily Storing Goods until They Can be Safely Moved to Their New Home

It’s not unusual to have to move large items of furniture and other possessions after a person dies. If a family member wants these belongings but can’t safely move them until better weather arrives, it may be worth storing them briefly in rental storage. This permits the executor to empty the home quickly.

However, emptying the home of everything straight into storage without a reason is not a good plan.

Storing Seasonal Equipment in a Secure Environment

Boats, snowmobiles and really cute vintage sports cars that would be absolutely suicidal to drive on snowy roads are three things that come to mind when I think of acceptable storage rentals. If there is no place to keep the boat or sports car in the winter or the snowmobile in the summer, then if you can find secure storage for them at a reasonable cost this seems practical.

Three Un-Reasonable Reasons to Use Storage Lockers

Storing Ugly Furniture
If it’s hideous now, it’s not going to start being gorgeous in ten years. Either reupholster it now, sell it, or give it away. Furniture left in storage is likely to get damaged, mildew, pick up odours, become a home for nesting mice, or get nibbled on by termites.

Storing Magazines, Textbooks, and Paperwork
Yah, we’ve all heard of how the first issue of SuperMan is worth hundreds of thousands of dollars now. But be reasonable, no one is going to pay you even $10 for the 187 th issue of Time or Canadian Living. National Geographics, no matter how gorgeous the photos (or how unclad the tribeswomen) are worthless. You can’t even give them to Goodwill or the Salvation Army.

Similarly, if you never cracked those textbooks till two weeks before your final, why on earth do you think you’ll read them again now, without any pressure? Yes they were expensive. But spending more money to store them is just making it worse.

Valuable papers shouldn’t be stored where you can’t guarantee they will be kept moisture, fire and vermin-free. And any other papers shouldn’t be kept at all. Digitize them or ditch them.

Storing Clothes
Unless you have one of those 250-square-foot apartments, there is no reason to need rented storage for your clothes. Help someone who can’t afford to over-shop. Donate them directly to people in need. For example, in Mississauga you can donate them to the Open Door at Square One, who let clients choose free clothes. Or donate clothes to a charity that re-sells them. Or try selling them through a consignment or vintage store. Just don’t keep paying money to store clothes you don’t wear.

Save Your Money Not Your Stuff

Hopefully you’ve thought through why you want storage and whether you need it. Remember at $50 a month, plus 13% HST, in 5 years you could spend $3390 on a locker. Or you could put the money in an RESP and with the Canada Education Savings Grant, you could have $3600 for your child’s education, and that’s not even including any interest or capital gains from investing that money. The choice is yours.

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Have you used a storage locker? Was it a good use of your hard-earned cash? Please share your experiences with a comment.

If I Use an InvestorLine DRIP Will I Get the Discounted Price for Reinvesting in Shares?

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A common benefit of Dividend Re-investment Plans, DRIPs, is that you may be able to buy additional shares in a company at a discounted price with your dividend payment. This type of discount is available to registered shareholders who are direct participants in dividend reinvestment plans and it may also be available to non-registered share owners who participate in a DRIP through an intermediary such as a discount brokerage.

Written: 2014
Reviewed: 2023

For example, in 2013, if you reinvest your dividends from Fortis through a DRIP, you are entitled to purchase your shares at a 2% discount on the market price if Fortis issues new shares to participants in its DRIP plan. (Fortis can elect to simply buy shares at the market price to reinvest dividends. If it buys the shares, it does not provide a discount.)

So if I owned shares in Fortis that were registered in my own name, I could register for a DRIP for them with ComputerShare, the plan agent for Fortis.

However, what if I hold the shares in Fortis through my online discount broker, BMO InvestorLine? In that case, the shares are not registered in my own name. BMO is my agent.

I know that I can register my shares for a synthetic DRIP with InvestorLine. What I didn’t know was whether I would also be eligible for any discount offered by Fortis for reinvesting dividends in shares. So I sent a query through MyLink, InvestorLine’s secure email program, to ask.

The InvestorLine MyLink representative replied, “You will receive the same discount on the DRIP program through us. It will be reflected on the DRIP price and pass through to you.”

In other words, if Fortis is not offering a discount, perhaps because it is buying shares from the market to meet the dividend reinvestment need, then the InvestorLine synthetic DRIP will also not offer a discount. If Fortis is offering a discount, most probably because it is issuing new shares to meet the dividend reinvestment need, then the InvestorLine synthetic DRIP will match the discount.

Key Differences Between the InvestorLine DRIP and a Direct DRIP

If you are the registered owner on record of Fortis stock, and you enroll directly in their DRIP with ComputerShare, you can buy fractional shares of the stock with your dividends.
If you use BMO as your agent and you are not the registered owner on record for the stock, and if you enroll in the synthetic DRIP through InvestorLine, you will not be able to buy fractional shares of the stock. Instead, your dividend payment will be used to buy as many full shares as possible, and the remaining dollars will be paid into your InvestorLine account as cash.

Further Information

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Do you participate in any DRIPs with your discount brokerage? Please share your experiences with a comment.