What’s Your Closet Velocity?

On a visit to Ghana, a west African country, in 2004, I noticed how many people wore second hand Western clothes. While others donned beautiful traditional fabrics and garments of their country, it was equally common to see t-shirts, Gap khakis and Levi’s that looked like cast-off Goodwill donations for sale at the market. My hosts told me these were referred to as obruni waawu, which, literally translated, means, “dead white people’s clothes.”
“Why dead?” I wondered. Before long, an answer dawned on me. Maybe to Ghanians, many of whom don’t have closets, the only reason you would give up your perfectly good clothes would be because you are dead. To them, clothes are something you use until they are no longer useable.
This led me to the idea of how often we, especially Americans, buy new clothes. In planning for cash flow needs, I always ask for a range of annual spending on clothes – an “acceptable” amount, and an ” ideal” amount. I have received answers for both ends ranging from $2,000 to $50,000.
What I have not asked is, how often are they throwing out old clothes? If we throw out old ones when we buy new ones, I would say we have a high “closet velocity.” Correspondingly, the amount of clothes we have on hand at any point in time might be called our “clothing supply.” I am borrowing these terms recklessly from economics concepts of money velocity (the rate at which money changes hands in an economy), and money supply (the amount in circulation at any time).
If you have a low clothing supply and low closet velocity, you are like a Ghanian wearing your small number of clothes until they have holes or stains or are unuseable. If you have a high clothing supply and high closet velocity, you started with lots of clothes, are buying lots of new clothes, but are also giving or throwing away “old,” or more likely, never-worn ones. You may be the Imelda Marcos of clothes.
If you have a low clothing supply and high closet velocity, you have a small, actively-traded closet. New clothes are entering constantly, but getting worn, and old clothes are going out. You have a high clothing budget, and you always look good. If you have a high clothing supply and low closet velocity, you have a large closet of seldom-worn items, with plenty to choose from, but that might be a bit dated.
In her work with Money Habitudes(TM), Dr. Syble Solomon identified six primary attitudes toward money. One of those six is “status.” Anyone with an American puritanical upbringing might see this as a nasty word. Status is something we crave but are supposed to pretend not to. Rather than take such a negative extreme view, Solomon recognizes that money, through status purchases like clothing, can help us make a good impression. It is not prudent to spend lavishly on clothes we will never wear, or to spend more than we can afford for the sake of trendiness, but it also is important to “suit up and show up;” to care about our appearance, looking fresh, not stale.
With her more balanced view in mind, I am going to take a second look at my closet. I don’t plan on being a dead white person anytime soon, but I may find potential obruni waawu destined for Ghana next year.

Holly Donaldson

Holly Donaldson, CFP® runs an hourly and fee-for-service financial planning practice virtually from her Tampa Bay, Florida office. She also works with clients throughout the U.S. (except Texas) interested in retirement and tax planning advice without product sales or investment management. Holly is the author of The Mindful Money Mentality: How to Find Balance in Your Financial Future (Porchview Publishing, 2013) and publisher of the award-winning monthly e-letter, "The View From the Porch."

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