One of the great joys of blogging is the friends I’ve made over the years.
I have a few who I communicate with on a regular basis and have been for many years (from when I started my former blog). Some have even written guest posts for me.
One of those friends is a coin collector of sorts. I don’t think he’s really into it like some, but he does buy coins now and then and sends me an email about them.
I live vicariously through him. I LOVE coins (and have since I was a child), collected some through the years (mostly by accident), and would love to start collecting seriously. But I stop myself because I think I would probably go overboard and coin collecting could be a big time and money suck.
This friend emailed me a couple months ago (as you’ll see below when prices are quoted) and asked if I wanted to interview a friend of his who was an expert coin collector. I said I didn’t even know what questions to ask and asked my friend if he’d interview him instead and send me the transcript. That’s what is posted below.
The interview is with “Dr. Dave”. He has his doctorate in Physical Chemistry from the University of California at Berkeley and works in providing compounds used in the semiconductor field. He’s also an avid coin collector, as you will soon find out.
The questions from my friend are in bold italics while Dr. Dave’s responses follow. It jumps around a bit but I think those of you interested in coin collecting and precious metals will find it fascinating. I did. Enjoy!
Dr. Dave, I have known you since senior year of high school (roughly 34-ish years). I knew back then that you were a coin collector and not an investor at that time. I have spoken to you many times about buying coins and trust your opinion and knowledge. What do you think of buying gold and silver in coin form as an investment?
If you just want to buy precious metals, coins are the worst way to go. You’re better off buying just ingots of metal.
Here’s why: turning metal into a coin costs money and people will pay for that.
Example: As I write this, gold is $1,268.4/oz and silver is $17.36.
The US mint will sell you a 1oz gold Eagle for $1,575 plus shipping. The silver Eagle is $22.95 (plus shipping).
The coins do come in fancy packages and cases, but you are paying a premium for the coin over the metal.
Now a coin investor is a person who buys coins in the hope that they will increase in value at a rate higher than inflation.
Just like anything else, sometimes values go up and sometimes they go down – so this investment is not without risk.
I am a coin collector. I collect coins for the beauty and history of the coins and to satisfy my mild OCD urge to have a complete set of something.
Some people do invest in coins, what are some of the coins people hold on to if they want to invest in coins and not just the physical metal?
Condition is everything when dealing in coins. It is also very subjective.
A while back, coin grading companies started “Slabbing” coins. What happens is you send them a coin (and a fee) and they have their experts rate the condition. The condition and description is printed out and sealed inside a plastic slab along with the coin, a hologram (to prevent counterfeiting) and a certificate of authenticity. In this way, the coin is protected and the rating is kept with the coin. This is supposed to make it easier to buy and sell the coin since a disinterested third party has rated the condition for you.
It helps, but isn’t perfect. For one thing — people make mistakes, even people employed by coin grading companies. And a buyer can still disagree with the rating — even if it was done by an “expert”. But the slab does protect the coin.
Confession: I hate slabs. They are bulky. Each one is 2 by 3 by 1/4 inch. The 324 coins in my penny collection would take up a huge amount of room instead of two 1″ thick books.
They also seem cold to me and take a lot of the fun out of collecting. But I started long before slabs came out so YMMV. That having been said — if I were buying a coin strictly as an investment, I’d probably go for slabbed coins.
Every run of coins has “Key dates” that is: dates and mint marks that are difficult to obtain. These are usually the last coins a collector will fill into their set. Most often these are due to a low mintage year or some other anomaly. For instance, the 1909S-VDB and the 1914D penny that I mention below are key dates.
These would be the ones to invest in or buy first for the collection. Most collectors buy them last because the price of these coins can often equal the price of every other coin in that set. You can find key dates for any run of coins with a simple Google search. Key dates are great to invest in because they are easy to sell. Anything that is difficult to obtain is easy to sell.
A Cautionary Tale about Coin Investing
Back in the 90s (before I met him) a good friend decided he needed to diversify his portfolio into some physical assets.
Understand, this is a smart man and I have a lot of respect for him. He had done very well for himself and his family by investing prudently in stocks and mutual funds.
He fell prey to a hard sell by an investment company. The company “guaranteed” double digit or high single digit appreciation. My friend gave them $10K to buy coins for him as an investment.
He had no idea what he was doing. He trusted the company and did not select the coins himself.
The company sent him several boxes of coins. All of the coins were in standard coin packaging. STD packaging is a cardboard folder with a cellophane window sized to the coin so that it is protected from handling and you can still see the coin. The holders cost less than a penny each. My friend put the coins away and figured they would be quietly appreciating in value.
A year to the day after buying them, he got a call from the investment company. They told him he needed to bring the coins down so they could be inspected and repackaged “for a small fee”. In this way, they could guarantee his investment would appreciate.
My friend immediately thought “Oh $h!t!”. That’s when he knew he’d been conned. He didn’t know much about coins but he knew you didn’t have to check them regularly. It’s a piece of metal — not a house plant. And you don’t handle them any more than you must as repackaging can cause wear.
Years later, in the early 2000s this friend asked me to look over the coins and give my opinion. There was nothing special there. They were all common coins in fair to good condition. He generously offered to give me any of them that I needed for my collection. I don’t think he had a single coin that was in better condition than anything I already had. There were no key dates or rare mint marks in the bunch.
He asked my help in selling them and I put him in touch with my dealer friend. The dealer took about 6 months to sell them all. This means he didn’t just dump them at the next show, but held out for the best prices he could get.
I think my friend got back about three or four thousand dollars. Keep in mind this is after holding them for over a decade. He got taken.
How did you get started and how long have you been collecting?
My father had a coin collection and I recall being fascinated at a young age by the fact that I could hold a coin that was 100 years old. I had no means to buy coins at the time so the idea of my own coin collection was just a dream. That was until I read an article in Boy’s Life magazine about starting a penny collection. This was back in the early 70s and you could still find Wheat cents in circulation. Wheat pennies were minted until 1956 and had a very different reverse than the current Lincoln Memorial. So, I guess I’ve been collecting for 45 years. OK, now I feel old.
Shortly after that, I got my first paper route and could start collecting all the current circulating coins. I stored them in the blue Whitman coin folders that you could buy in the local dime store. These folders had a cut out for each coin by date and mint mark and had basic information about the coins – mintage numbers, things like that. These folders fed my OCD tendency because I really wanted to fill each empty spot.
Mint marks: The US has three mints that make coins: Philadelphia, Denver and San Francisco. The mints are identified by a P, D or S on the coin. If there is no mint mark – it is a P. In different years, different mints made different amounts of coins and that can affect value. In recent years, the only S coins are available in Proof Sets. Proof sets are a special set of coins in a sealed plastic case that the mint makes to sell to collectors. They cost more than a basic uncirculated set.
Do you focus on anything in your coin collection? Can you explain what and reason why?
See above. I started with change that I got. Several years in retail helped with that, I’d stay late and go through the register to see if it contained any coins I needed. I’ve broadened to older US coins since then – mostly to have something to collect. I also have a nice Canadian coin collection from when I used to live in Detroit and Buffalo. I’ve stopped adding to it since I now live in TX and don’t see those coins anymore.
Where do you buy most of your coins?
These days I get my coins from the mint or coin shows. Every year I buy 2 mint sets and 2 proof sets from the US mint (www.usmint.gov). This year the uncirculated sets cost $20.95 and the proof sets $26.95 (There are twice as many coins in the uncirculated sets as the proof.) I keep one set of each untouched and cut open the other set to put into my coin books. Many collectors consider this sacrilege, but I do it for my enjoyment.
There have also been times in my collecting history when I could buy a complete set cheaper than I could buy a single coin that I needed to complete a year. Does this make sense? No, but welcome to collecting.
Coin shows are held regularly and are just a bunch of collectors and dealers selling items to each other. They are useful for coins that are no longer in circulation.
Have you sold any of your collection? If so do you remember the reason why you sold and did you make a profit?
When I first started collecting, anytime I got a better-quality coin than what was in the collection I’d swap it out and spend the lower quality coin. Now that I buy most of my coins, I will upgrade (By now I’ve probably replaced almost all the coins I ever got in change) and I have sold some coins but I find it to be unpleasant. Currently I have several bags of coins that I’ve upgraded that I tell myself I’m going to sell one day.
I have made a profit a few times, here’s an example of that and why I find the experience unpleasant:
The mint makes a third collectors set called a silver proof set. Your quarters, half dollars and dimes haven’t been made of silver since the mid-sixties. Currently, they are a mix of copper and nickel. But the mint makes a special set where those coins are pure silver. It costs 2 or more times as much as a regular proof set. I bought these for a while then stopped because they take up a lot of room. If you’ll recall, back in 2010, Silver broke $40/oz. So, I had two things going for me here – appreciation due to time (No guarantee, YMMV) and appreciation due to metal content.
When you go to sell a coin to a dealer they will pull out something called a “Grey sheet”. This is a publication that you can buy that gives the “Bid” and the “Ask” for each coin. (Bid is what you buy for, ask is what you sell for.) This number will vary depending on condition and you will often find yourself arguing condition with the dealer. In my case, however, this should have been an easy transaction because a proof set is sealed by the mint and the coin’s condition is therefore fixed.
Well every dealer I approached found one way or another to drive the price below bid – even to the point of critiquing the outside cardboard package! This left a very bad taste in my mouth and I can only imagine it is worse when you also have the condition of the coin to take into consideration and argue about. I still made a nice profit and, more importantly, freed up room in the safe from something I no longer wanted to collect, but it wasn’t fun and I collect coins for fun. (And to sate my OCD tendencies).
I now have a relationship with a dealer – a man I trust who travels the state going to shows every weekend. He also buys and sells coins via the internet. I tell him what I want and he keeps an eye out for me. The next time I want to sell something, I’ll let him do it for me. He’ll take a small commission, but will probably get a better price than I could just wandering around the 6 shows per year that I go to. This will also eliminate stress and the bad taste in my mouth,
What has been you biggest surprise in a purchase?
That you can buy a coin for less than its current value.
I was looking at a coin that was worth $100. I knew it was worth that because I had done my research. The price was $100. It was fair. The problem was that I only had $85 left in my coin allowance for the show. The dealer noticed me looking at it and asked if I was interested. I decided to be honest with the man and told him that the price was fair, it was a nice coin, but I just didn’t have the money for it. He asked me what I had and I told him $85. He looked at the coin, read his code on the back and said he’d take the $85. I was happy – so was he.
This illustrates a very important point – the value of anything is exactly what someone else is willing to pay for it. All the books in the world can say that a coin is worth $100, but if the best offer you get is $85 – then the value is $85. Also, keep in mind that the dealer didn’t pay $100 for it either. He paid less either by buying it a long time ago or by buying a large collection or by paying less to someone who was desperate to sell.
Most dealers know what they paid for a coin and have some code on the back of the package that tells them that. Most dealers also know that the key to being profitable is turnover. It’s better to make a few dollars on a coin and turn that money over into new stock than it is to sit on stock that isn’t moving.
You should always bargain. Full disclosure: I am terrible at bargaining. My wife, on the other hand, can just smile and ask and usually get between 10 and 20% off. (Oh yeah – coin shows are predominantly male. I’m sure this has NO influence on her getting discounts.)
What was your biggest disappointment?
It must be the multiple times I’ve bought a coin I already had in my collection. Worse yet, sometimes I bought a lesser quality coin than what I already had. You need proper records and you need to keep them up to date.
What was your biggest mistake you felt you made?
When I was new to coin collecting I wanted all my pennies to be clean and shiny. That same Boy’s Life article had a method for cleaning coins that involved boiling them in a mixture of vinegar and table salt to clean them and then polishing them with vegetable oil.
NEVER CLEAN COINS! The mixture above produces a mild hydrochloric acid solution which eats the copper along with the corrosion. The vegetable oil soaks into the coin book and weakens the paper allowing water to get in and corrode the coins. You will see coins downgraded by a grading service (see Slabs) because they’ve been cleaned.
I know you have a collection of pennies from all the different mints from some date to present. Can you elaborate on this collection? Like how long it took you to complete? What was the hardest penny to find? Other than face value and all the hard work it took for you to find all these would this be of value to someone else as a collection? Is this something of worth to an investor or more of a collector? Why did you decide to do this?
Most of this was covered above. I have a Lincoln cent collection that spans 1909 to the present year. I have every mint mark made.
I do not have the errors – yes people collect those too and there are some famous ones that even make their way into the storage folders.
I do not collect error coins because they are way too much money and they can be counterfeited. Example: In 1922 there were no pennies made at the Philadelphia mint. The penny did not have a P mint mark at that time so all 1922 pennies should have either a D or an S. But one of the dies wore out to the point where the D was missing. This is an error.
Today’s technology allows unscrupulous people to remove a mint mark with an industrial laser that is almost undetectable. One of the most famous errors in US coin history is the “Three legged buffalo” where the buffalo nickel die became clogged resulting in a missing leg. Some people estimate that there are more counterfeits of this coin than originals.
The hardest penny to find was the 1909 – S VDB penny.
This is a cool story. When the mint commissioned the design for the new Lincoln cent to replace the old Indian head cent the designer put his initials “VDB” on the die. The mint did not notice at first and, when they did, they got upset and removed his initials, but a half a million pennies had already been minted and released. This caused a rarity of the mint’s own making. These coins are very desirable and popular with collectors. I resisted buying one for a very long-time due to the premium but eventually broke down and bought “The last coin to complete my collection”.
Side note, the second most difficult coin to get (and thus second most expensive) is a 1914D coin and I’ve had that in my collection since my paper route days – meaning I got it in change. Now that’s cool!
Selling coin sets is an interesting conundrum. Believe it or not, most collectors are in it for the thrill of the chase. A complete set like I have has a distinct value, but most of the time, you will get more by parting it out. This is what my dealer friend tells me.
I know there is a difference in collecting and investing. Some people are more collectors than investors (for the hunt and fun of it) while others are more investor than collectors (for a profit). Can you explain to us your view of where you classify yourself as on this scale over your years?
I am and always have been a collector. If I wanted to make a profit, I’d need to pay for a table at the shows and go to a show every weekend buying and selling. This does not sound like fun to me. There is another way – identifying coins that you think will move faster than inflation and buying them. Just keep in mind that you can be wrong and there can be costs involved in selling.
What are your best resources for education?
The internet of course. Beyond that, buy and read (I mean read!) “The Red Book”. The official title is “A guide book to United States Coins” They come out with a new one every year with coin values updated for the previous year, but the information about coins and collecting is very useful. You can probably find older copies for very cheap. Also, if there is a local coin club – join it.
If someone were to buy coins as a hobby and just collect for fun and knowing that it could make a profit or loss what advice do you have for them?
Buy the Red Book, look through your change, buy good storage materials (I like the books, other people like the individual cardboard holders).
Read about coins online and in the books. There are internet coin dealers. Some are good – some are bad. I don’t do that because I want to hold a coin in my hand before I buy.
If you have a small local bank, build a relationship with one of the tellers. Tell them what you are looking for. A lot of them will help you.
Back in the 80’s I was buying all the Ike dollars I could get my hands on. These were a large silver dollar (copper nickel, but everyone called them silver dollars) that the mint had discontinued in 1978 and I was convinced that they were going to skyrocket in value so I asked my local bank to hold any they got for me.
One day I walked in and heard the tellers say “Shh. Here he comes.” I completed my business and then asked if they had any Ike dollars. The teller proceeded to dump about 70 of them on the counter in front of me. They all had a good laugh. At the time, I only had about $20 on me and asked if they would hold the rest until tomorrow. They were happy to do it.
So, how did that “investment” pan out? Well I have around 100 Ike dollars that I paid $1 apiece for in, let’s say, 1985. I haven’t gone through the set to see if there are any key dates, but I kind of doubt it. The market for circulated Ike’s is $1.80. So, my investment is worth $180. Maybe. What would that $100 be worth today if I’d put it into an index fund? A heck of a lot more!
But (and this is important.) I would not have put that $100 into an index fund at that time of my life. This was hobby money. If I hadn’t spent it on coins, I’d have spent it on something else.
If someone wanted to invest in coins (for a profit) what advice would you have for them?
Do your homework.
Buy slabs. Buy key dates to keep your count of coins low.
Build a relationship with a dealer.
Buy gold coins when gold is low so that you are paying for the collector value – not the metal value. The same goes for silver.
Have a safe place for storage – safety deposit box, safe, something.
Last story: I used to work retail in Grosse Pointe, Michigan. This is a very rich suburb of Detroit. Every now and then some kid would get into dad’s coin collection and spend it. You could always tell when this happened because Mercury dimes and Liberty quarters along with Franklin halves would suddenly appear in the cash register. I would then hit up the other stores in my area and pay 10% over face value for these coins. The other retail workers were happy to get the premium and I added a lot to my collection on those weeks.
LOCK UP THE COINS!
Alex C says
Great post, thanks for sharing
Jim Wang says
Thanks for publishing this interview, it was a really fun story to read. I have on my desk a funny looking quarter I found in a field behind my house… turns out it’s a silver quarter and worth about $3-4. I’m a collector!
I have a dollar 1990d it’s a coin with a lady on it. I was wondering if was worth ant thing
Brandon Potts says
What all do u have. And how much
Jim I don’t collect but I hunt coins all the time I have several coins and 1 cob coin I found at a old park….
Very enjoyable article, thanks for the insights.
Just to answer the question at the top of the article, in general I would never consider any collection an “investment”. I’ve always found that the bulk of people who are serious about what they “collect” tend to spend more money on the collection (and the storing of the collection) than the collection is ever actually worth simply because they will never sell the pieces of high value. So they’ll point to their “investment” in a particular piece and go on and on about how much it’s worth and why it’s so great, but if you ask them when they’ll sell it you get this look of shock. It’s as if I asked when they were going to sell their child. Then you get the folks who buy something, horde it, and even if the market or condition of the item changes, they assume it’s always worth its top value (think beany babies or Hummels). In general, the collector dies, and the heirs break up and sell the collection, so the original investor never actually sees the fruits of their labor.
So IMHO collecting is a hobby to enjoy the things you collect, but rarely to make money at as a real investment. The ones I see who make the money are the people who find they have something collectors want, and sell it for a profit. Like a woman on antique roadshow who found out the ugly (in her view) vase she had was a one of a kind and worth something like $45K, and they did a follow up and she had basically gone right to auction and sold that vase for something like $47K. Compare that to the family that has an heirloom collection they want to keep in the family. Good for them, but not so much an investment as a burden as you have to buy additional insurance for it, make sure it’s properly maintained to keep it’s value, protect it from damage, etc. even if you do end up enjoying it.
Fun reading. Would also be interested in a similar article covering baseball cards and/or other sports memorabilia. I am one of the lucky ones whose mother did not throw out his collection so I have tens of thousands of cards from the 60’s through the early 80’s.
Sounds like you’d be the perfect expert to write such a piece! 😉
I’m no expert. I have complete sets from many of those years and lots of stars (Aaron, Mays, Mantle, Clemente, Seaver, Bench, Morgan, Rose, Carlton, Frank and Brooks Robinson, Schmidt, Carew etc.) but have no idea how much they are worth.
Great read, this blog post can apply to just about any type of ‘collecting’. My own experience in collecting includes baseball cards (’67-’72), comic books (bronze age), and have friends that collect stamps, coins, and guns.
With very few exceptions, the only people who make money off of collectibles and antiques are the dealers. The most profitable way to make money is to sell to individual collectors, but at a certain point the time and PITA factors make selling to a dealer the most attractive option. Dealers for cards and comics will pay about 20-25% of book value, and 50% for key issues, if they are dealing with a knowledgeable seller. But I have found that ‘the price’ is just what someone is willing to pay, and has little to do with the actual book value or accepted value.
Really interesting story about Dr. Dave’s friend who was conned into numismatics as an investment, I’ve heard several similar stories in my circle of family-and-friends. Also, feeling Dr. Dave on ‘satisfying his OCD tendencies’!
D. Davis says
Great read! I have a small collection of old coins that I have accumulated over the years, also through my work in retail for almost 20 years. Probably not as easy to do anymore as so many people use credit cards these days, but back in the 80’s and 90’s, you could find some pretty cool stuff. My father traveled internationally frequently in the 70’s, and would always bring me back coins and stamps from wherever he visited. I (regrettably) lost the stamps many years ago, but I still have some of the coins. No real value there, but it’s cool nonetheless to look at the coins. Thanks for sharing!!!!
Cody @ Dollar Habits says
This was a really great read and very interesting. My dad and grandpa are/were mild collectors. I also have an uncle who is a pretty serious collector and even worked part-time at a local coin shop after retiring. I have had an interest in coins and an appreciation for them since I was little and while I have bought and sold a few here or there, I have yet to take the plunge to become a collector.
My dad bought a proof set from the mint the year I was born and gave it to me on my 18th birthday just as a cool little token. I plan to make it a family tradition and have bought proof sets for each year my two sons were born. Also, I have a container with about 30 silver dollars in it which were given to me by my grandpa on each birthday and Christmas until he passed away when I was 15. Coins can definitely become a cool little family tradition or heirloom.
That was a fascinating interview. My father-in-law has been a coin collector for decades. I have never spoken to him about it. It sounds like a fun hobbie that could be profitable. I have collected cards, but it has been more for fun than profit.
Tecoyia Horn says
I have coins that I am trying to sell that I know is worth money along with baseball cards can someone refer me to someone who would be interested in buying.Thanks
Brandon Potts says
What all do u have. And how much
Mike H says
I was a coin collector at the age of 11 and 12. How I wish that I took all that effort and knowledge and bought stocks instead of coins back then. I have a modest collection of assorted old US coins. I think they may have appreciated by a small fraction of inflation. I don’t view coin collecting as investing. The traders are the ones working for a living and making money off the spreads.
Investing to me means buying something that is throwing off positive cash flow, even if this is as retained earnings and used to grow the business. How I wish I learned this lesson 32 years ago rather than 4 years ago but better late than never.
I started collecting coins in the late 1950’s, when you could still find Buffalo nickels, Mercury dimes, Standing Liberty quarters with dates, and even the occasional Indian cent in circulation. My activity developed into a mix of collecting, investing, and a small business. I was active into the 1970’s, and have followed the field ever since.
By far my most financially successful activity was saving silver coins (90% silver dimes/quarters/half dollars, 40% silver Kennedy half dollars, and silver wartime nickels) from circulation in the 1960’s. I sold some for a small profit in the late 1960’s (which convinced my dad that I wasn’t wasting my money) and saved as many as I could afford. Then, when silver skyrocketed from around $1.50/ounce in the late 60’s to $50/ounce in 1980, I cashed some out near the peak, which helped provide the down payment for my Silicon Valley home. (This was not investing – it was luck. It was equivalent to picking one of the few individual stocks that goes up by 30x in 10 years.)
Unless you are extremely knowledgeable, or have an excellent dealer connection/relationship, it is extremely hard to make good investment returns with collector coins. The buy/sell spread is simply too high (at least 20%), and, as others have commented, there are many other ways to get fleeced. And, even if everything else is done right, luck is involved – you need to pick a segment of the coin market (such as type coins or individual series) that remains or ideally gains favor over the time you hold your investment, and you need to get the market cycles right. And, if you do make money, the capital gains tax rate is 28%, vs. 15% for more traditional investments such as mutual funds or real estate.
Those silver coins that used to circulate have the advantage of much lower buy/sell spreads, and fewer risks than collector coins (for example no grading risk). But silver is a commodity – by its nature, highly speculative. (The financial equivalent is individual tech stocks – a stock might go up 30x, then down 10x, then stay flat for many years, and finally go up 5x again. That’s pretty much what silver has done from the 1960’s to today. In the financial world, index mutual funds are much safer. There is no equivalent in the coin world.)
(After dabbling in coins, I went into equity mutual funds and rental real estate in the 1980’s. Those more traditional investments were far more successful for me than coins or silver ever could have been.)
Jeff B. says
Comic books are the new coins and stamps. They will probably fall out of favor in 10-15 years and replaced by something else.
Saber Dance says
As a mail carrier, now retired, I collected letter openers. A wonderful hobby but definitely no investment. It was easy for family members to find a gift for me on birthdays, etc.
I remember an article, decades ago, in BHaG mag, I think, about a lady who collected cookie jars. She had over 2,000. Man, they were all over the house!
Saber Dance says
What a helpful interview! My memory is far from what it was 50, 60 years ago. Thus I stay with the bullion.
Bought a few tubes of the Austrian Silver Philharmonics 1,50 EURO coins. We are from Germany. So we give a coin for birthdays and a tube (20) as wedding gifts. Requires no shopping for gifts.
Great interview. Like the Dr., I have also collected since childhood, but sparingly. I would add that there is an “art” value to collecting. I personally love the art deco designs of the early 20th century coins. Stop by a coin shop, and check out a Mercury dime or walking liberty 50 cent piece in near mint condition. They are breath taking!
Derek Dewitt says
I have always wanted to start collecting coins, so this article was a real eye-opener for me. I like that you mention how the value of anything is what people are willing to give. I’ll have to keep this in mind when buying coins so I can still make a profit.
Bethany Birchridge says
I like how you pointed out that coin collecting can give you some extra money, but it works better as a hobby. You made a great pointed when you pointed out that making coins is more expensive than have an ingot. My brother is a coin collector, and he’s been wondering if he should use it as a way to invest. I’ll share this article with him, so he can make an informed decision.
Steven McKee says
Great post. I too am a coin collector. PhD in Chemistry at Ohio State. My collection of late has been silver dollars. Every silver dollar since 1878 (except 1895 P Morgan). That caused me to expand into silver dollars, or their equivalent across the globe. China, Canada, Australia, Great Britain and Mexico to name a few. Lots of fun but it is collecting and history. The investment porti9n comes, I believe when I try to improve the quality of a coin that I already own.
Bob Albee says
I am in my early sixties and have been collecting coins most of my life. I live in the Eastern United States and do not spend money on coins. I am always checking coins in circulation. I am looking for somebody West of the Mississippi River who also collects coins in circulation and would be willing to trade coins. National Park quarters for example. Most of the P mint marks are distributed East of the Mississippi River and the D’s are distributed West of the Mississippi. I have a very difficult time finding the D mint mark coins to fill my little blue books. I am guessing that collectors out west are having problems finding P mint marks. If anybody is interested in trading same coins for same coins, please let me know. Thank you.
Jim Gossweiler says
It’s very possible to be both a collector and successful coin investor. Here are the rules: (a) Buy only professionally graded coins, (b) Buy only coins with a following; rare does not always equal valuable, (c) Buy only coins that are extremely rare now; coins that aren’t rare now won’t be rare in 30-years either, (d) Do not overpay for the coins…make reasonable offers or walk away, (e) develop good relationships with your dealers; very often the best coins go to the best customers and at the best prices, (f) keep your dealer happy; give them a reasonable profit, (g) faithfully record what you paid for each coin, you’ll thank yourself later, (h) insure your collection, (i) be prepared to hold the coins for no less than a decade or more before selling. Best best? Hold 20 or more years, (j) Sell the coins one or two at a time (not as a giant lot) so collectors can replenish their funds before buying more, (k) If possible, take high quality, high resolution photographs of the graded and slabbed coins, (l) Record the professional grading service’s number for each coin, (m) Store coins “off-site” or in such a way as to deter or prevent theft, (n) Tell as few people as possible you collect coins, (o) Enjoy the coins while they edge upward in value! I know people that have made a living buying and selling collector coins for decades!
Matthew Gorski says
Perfectly written article. The best was “But (and this is important.) I would not have put that $100 into an index fund at that time of my life. This was hobby money. If I hadn’t spent it on coins, I’d have spent it on something else.”
I recently inherited a large coin collection that seems to have some very valuable coins. If I wanted to sell some, what’s the best way to do that?
If I had the same issue I would contact J$ at BudgetsareSexy.com and see what he recommended.
I started collecting coins as a hobby …. my wife got involved and now it’s an investment ….. still fun as we enjoy going to coin shows and meeting some terrific people and it gets us out of the the outta house and we like to drive to shows within a 200 mile radius and trying restaurants we usually don’t eat at … so it’s all good
I’m a little different from the Dr. I actually didn’t start collecting until I was older. I always appreciate old coins and would grab the few I would find in circulation and put them aside but it wasn’t until I was much older that I got bitten by the bug. I initially got started because of an early episode of pawn stars where someone brought in a gold coin they found in a wall of their home. Turned out to be worth 25k or something like that and at that moment I was like wow. I went to a flea market that weekend and purchased my first couple silver dollars. I spent lots of time studying and learning and decided I’d start to buy peace dollars. I decided early that I wanted the nicest ones I could afford and being low on experience I would mostly buy slabbed coins to protect from buying fakes or altered coins. I Started with ones under $100 but it wasn’t too long before I had bought a key date for almost $700. At the time I didn’t have a ton of money but I looked at it as something I enjoyed that even if i didn’t get rich it should somewhat preserve my initial investment. I’ve continued collecting for the last ten years sometimes more seriously than others but with my affinity for older US coins and buying the nicest I can afford I’ve built my collection slowly. I tend to stay away from common stuff which I hope will help protect my investment. I’ve been to many shows and when people are there to sell coins they inherited it’s almost always very common stuff, mint sets, and average circulated Lincoln sets and stuff like that. T hey always find out quickly dealers only pay a fraction of what the supposed value is on that stuff because they are already sitting on ten of the same thing. Do like the Dr said if you are trying to protect the investment stick with rarer stuff and key dates they will always hold a premium over the common stuff.
John Wilkinson says
Dave, I am a low end collector. That is: coins we yet see in circ. +/// w/ myself I collect only the first four lower denoms// you could say. P-N-D-Q. Sure. Larger + Bill’s interest me but my bulk is in the smaller coins.
Jefferson Nickles: appreciate it if you can email me or even text me at blackcombs (dash) 5 at live dot com and my cell is CT second-coming-of-age AREA code 8 6 0 then 5 & 1 & 5 dash 7 & 6 8 & 0 does it for me.
The 1961 whole series. What are your comments.
2: What coin site do you USE as your standard¿?
And now two more questions: aa) Canadian pennies what are your thoughts as it might pertain to a “collector” such as myself (low-end collector). bb) The 1970 Canada error Eagle Q. what are your thoughts here ? I might as well stop looking too right???
Would like to get talking with you about SILVER ROOSEVELT DIMES/SILVER WASHINGTON QUARTERS. RIP OFF PRICES I SEE [“REVERSE RIP OFF” IS WHAT I MEAN!]