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My list of top 3 reasons you should collect coins.
Ask any entrepreneur or business what the best method of marketing is. The best way to get their business name or product out there. They’d tell you one thing, ‘word of mouth’. There’s no better way to give your stamp of approval than by telling others or sharing/liking on social media. And people listen. They’ll listen to you and I describe why we are raving fans of certain brand names and products. As a coin guy, you know I’m a raving fan of the hobby and have a passion for it. But if you don’t share that passion now, could you? What should you consider if you were contemplating getting started in numismatics? While this unfolds as a Top 3 Reasons to Collect Coins list, don’t be confused, this is my word of mouth recommendation to you to take up and embark on the lifelong journey and rewards that coin collecting has to offer.
Rewarding and Accessible to Everyone
Travel, baking, sports, playing video games, online shopping, photography, arts & crafts, social networking, tinkering with technology, sewing. What do all of these have in common? If you said that this list represented the top 10 hobbies from 2014, you’d be correct. Kudos to you if you got that correct. But let’s dig a little deeper here, specifically, what one resource is required to engage in each of these activities? Do you need money to travel? To bake? Play video games? Shop? You get the point. Every single one of these (with the exception of social networking, which by the way, when did checking Facebook and sending tweets become a hobby?) requires some initial outlay of money to get started. Sure that initial investment can vary, even within a selected hobby itself, but it still has an upfront capital requirement. Let’s also not forget that you may not ultimately enjoy the hobby, turning that initial money spent into a sunk cost. How many of us have purchased exercise equipment, now cast to the shadows of the garage, basement, closet, as if it possessed some kind ill will towards us? What about that camera where we were going to diligently document our family memories? My wife has yarn, needles, and this template to make a beautiful women’s sweater (but its been in the closet for at least 5 years!). There are thousands of such examples. But here’s the point, coin collecting doesn’t require any initial upfront investment. Anyone can start, anytime by simply going through their change! Know someone who has a coin jar or piggy bank? Well they’re simply going to take that to the coin machine so be the coin machine for them. Buy the change off them and look through it. If there’s nothing of interest or value, then you can get your money back by taking it to the coin machine itself. Everyone has change and most don’t value it. So be the one who does and see what treasures can be found. If you’re skeptical that this works, here are two recent examples.
Back in May (2016), I was away with my family for the Memorial Day holiday. Any time I make a purchase with cash, I of course check my change (and really anyone else’s who I’m with). After paying for a nice dinner out, I received the change and what was in there, a 1957 Washington quarter! The coin was in decent condition considering it was still in circulation and while it certainly won’t represent that series in my U.S. Type Set (link to article on what I collect), it’s a 90% silver quarter and with a silver spot price of $16.62, this coin is worth approximately $3.01 alone in silver! Our meal that night was great, however if it wasn’t, wouldn’t have mattered. I was going home happy either way.
The second story happened last year. I was in my 2 year old daughter’s bedroom, with the contents of her owly bank splayed across the floor. A rather common scene in my household for a coin jar to which I am not the depositor. As I sort through them, with my daughter inserting them back into the slot at the top of the owl’s head, I stop. Holding the rim of the coin between my index finger and thumb, I pull it closer to get a better look at it. The obverse reveals it to be a buffalo head nickel, date very faint, but still legible…1913. With my left arm, I push myself up so that I’m now sitting up, knowing what could be on the reverse of the coin. As I rotate the coin to reveal the coin’s reverse, I let out a ‘Hell Yeah!’ After seeing so many buffalo nickels with the redesigned, thinner straight line, it was easy to tell this one was one of the first varieties, on raised ground. Again, not a coin that will make its way into my U.S. Type Set (link to free U.S. Type Set List & Tracker), but certainly what I deemed, ‘a keeper’! Well you know, a keeper for my daughter since it did come out of her owly bank.
So yes, you can begin collecting with no initial capital requirement. And if after reading those stores, you’re thinking to yourself that you won’t be able to identify such examples, then fear not. For that’s another great part about collecting. The access to coin clubs, online resources, and those who can provide answers to you, helping you learn along the way, is confined only by your desire. A few years back, I was looking to get involved in a coin club and after a quick Google search, I found 4, all less than a 30 minute drive, one less than 10 minutes from my home. These 4 clubs meet monthly but depending on your club, it can vary, and the cost, if any, is minimal. I pay under $40 a year to be involved in my local clubs (note I am not a member at all 4). Keep in mind that there’s always something to learn in the hobby. And many of the members have been collecting for a long time and can provide you with great insights into the hobby, help you get started, or answer your questions. As an added benefit, you may be able to swing a trade for a coveted coin another member has (you’ll realize some of your best acquisitions will be via this method as local club members usually realize the value of a coin and are engaging in a trade not to make money, but to add something to their collection which they themselves are looking for). In addition to local coin clubs, there are online memberships, some free and some fee based such as the American Numismatic Association (ANA), that you can sign-up for and pay a fee for to become a member. One of my favorite features of the ANA is the ability to check out books from their numismatic library, whereby your only cost is shipping. I’ll check out 5-10 books at a time to get the best bang for the buck. So when you have doubts about knowledge, understand that there are many resources available to you, for minimal or no cost (or just e-email the coin guys, click this link, we love getting your questions and helping collectors out!). ‘A journey of a thousand miles begins with a single step.’ – Lao-Tzu
Coin collecting also presents the collector with the opportunity to determine what their level of sophistication will be. One could simply throw coins that appeal to them in a crayon box (I know someone who did that! read about it here). Then simply let it evolve, be curious, ask questions, and seek answers. You won’t know everything at the beginning of your journey, but just like you and me, Q. David Bowers once knew nothing about coins. He’s gained his knowledge through years of experience and research. I’d venture a guess that if you were to ask him today, he’d still tell you he’s learning to this day. If you take this path, you’re sure to learn and the sophistication of the hobby for you will increase. But on the flip side, if you’re completely content with throwing coins in a crayon box, then don’t let anyone tell you that’s wrong. For it’s your choice and you should do what feels right.
That to me is one of the most rewarding aspects of numismatics. Unlike other activities which require you to follow a certain predetermined path of progression, collecting coins does not have such a path. It’s the open road whereby you choose which direction to go and turns to take. You will never find two people who have the same exact collection. Each coin is unique, therefore each collection is unique and cannot be replicated. When you set out to complete an album, a certain coin series, a set, etc., there’s always a special feeling when you get that next coin that will be part of the collection. Often times, the hunt can be the most exciting part! There are literally thousands of possibilities whereby there is no right or wrong and the decision rests solely with you, the collector.
Connecting With Others
My collection and path was very haphazard at the start. This all changed however the day I received a bag of coins belonging to my grandparents. When the bag was given to me, I was like a kid on Christmas and couldn’t wait to get the coins home and look through them. During the 15 minute ride home from my parents house, I couldn’t stop from glancing over at the bag, sitting there on the passengers seat, every couple minutes. When I got home, I hurried down to the basement, put the bag of coins on a table and flipped on the overhead recessed lights, as well as a few other lights which shown down on the table. I got out a scope, magnifying glass, and special handheld lighted extreme magnification tool. I pulled a few coin books off the nearby bookshelf and got out my tub of coin supplies which contained coin holders, flips, etc. As I sat there in the silence, looking through this bag of coins, something very real swirled up inside me. The sensation took over as I was holding an 1802 Draped Bust half-cent. While looking at this beautiful coin, I realized that what I was holding was at one point in time held by my great great grandparents, my great grandparents, and of course my grandparents. The coin had been in my family for 3 previous generations, generations for which I never met in the case of my great great grandparents, and a generation in which I was too young to remember any memories in the case of my great grandparents. Yet here I was, holding a coin that they once held. My brain lite up like a firework show with questions, thoughts, and feelings. I wanted to go back to the time that this coin was first saved. Specifically the house, the bag the coin was placed in, where they put the bag, what was for dinner, and why they decided to save the coin. What was purchased that resulted in receiving the coin as change? What would my great great grandparents say if they could see me, my home, and what I was now going to store the coin in? The best of all however, was that just by holding that coin which they also held, I felt a connection with generations of my family that I had never felt before.
Coin collecting has also served as the spark for developing a special bond with my daughter. I try to involve her as much as possible when I’m physically looking through recently acquired coins, putting coins in flips or holders, and inspecting coins under magnification. She has her own magnifying glass and will run into her play room to dig it out anytime we sit down for a session. I have a couple of bags that I use and will take with me when reviewing and valuing customers coins and collections. When I’m leaving with one of those bags, she’ll oftentimes say, ‘Daddy are you going to look at coins?’. And about half the time she’ll ask to come with me! I’m the type of father who loves that she enjoys this time. I truly cherish the time for if the day comes whereby she no longer has interest, I would not force the hobby upon her. I’ve found myself to be happiest when I am working on something I love and am passionate about. During these times, I can be creative, achieve that ever so desired state of ‘flow’ when doing my work. However happiness, creativity, and flow do not come when something is forced upon you. This is the lesson I want to teach my daughter.
I also use her interest in coins and helping her daddy as a learning opportunity. Specifically, how coins are meant to be saved in her owly bank. I’m a geek when it comes to personal finance so I intend on implementing an interest earning component to her savings in her owly bank to further show her the power of saving. But she’s only 3 so for now I’m satisfied with the fact that when she gets new coins, her first instinct is to save it in her owly bank.
While the hobby has certainly strengthened my connection with my family, its also enabled me to volunteer at coin shows and connect with people, clubs, organizations, and events in which I never otherwise would have had the opportunity to interact with. I’m also very intrigued by each collector I come across and specifically how they got involved in the hobby. It’s amazing to hear some of the stories about how certain individuals developed a passion for the hobby. Something the coin guys will be looking to do in the future is to have people share their stories, in their words, on our site. Like I said, there are some remarkable stories out there and we hope to bring these to you in the near future. If you have a story you’d like to share, please tell us by visiting this link and we will share your story!
Collections Have Value
Have you ever stopped to think about the operating costs of your hobbies? Let me give you an example. I won’t pick on my golf hobby as that’s too easy, so let’s take movies. My wife and I enjoy watching a movie or two during the weekends after my daughter is in bed (easier said than done these days). Generally speaking, other than sports, a few HBO shows, and movies, I don’t watch much TV. For this reason, we cut the cord and got rid of cable over 2 years ago. Yet watching movies is a hobby my wife and I enjoy. So, we have a subscription to Netflix and HBO Now, which combined runs about $30 each month. When we rent a movie, we rent through iTunes on the Apple TV which runs $4 or $5 a pop, so about $20-$30 a month. Thus, in looking at this very simplistically, we spend over $700 annual for our movie hobby. I’m not saying that this is high, low, right, or wrong, just stating the fact that because we like to watch movies, that’s what it costs us each year. Compare that to something else that my wife and I enjoy doing, playing board games. What’s the operating cost of this annually? Well, it could be nothing if it’s a board game we already have, or it could be the one-time cost of the board game. The latest addition to our board game library was Risk – Game of Thrones edition which cost $65. We could play this over and over, or swap it out with other board games we have, all which have a $0 ongoing operating cost.
So you see, each hobby, whatever it may be, has some level of operating costs associated with it. In my two examples above, the difference is fairly drastic, $700 compared to $65. At the end of the year, what would happen if we tried to sell each of these? Well the movies are just a sunk cost and there’s nothing you could sell to make any of your operating costs back. You could cancel the subscriptions but that’s forward looking and you still get nothing for what was spent during the year. For the board game, I could certainly recoup a percentage of my costs if all the pieces are still in-tact and none have gone missing. But based on prior experiences selling board games, I’d do well to recoup 50% of my costs.
And this my fellow collectors and future collectors is one of my favorite parts of collecting! Whatever it may be, there’s an underlying value to numismatic coins. In reviewing the rare coins index, click this link for article, you can see clear appreciation over time. Smart buying decisions will be rewarded with future gains when and if you decide to sell. What other hobbies offer this kind of opportunity for potential appreciation in value over time? Certainly there are others yes, but there’s something about the tangible nature of coins and their various underlying metal compositions that draws me to them. I’m not the doomsday zombie apocalypse type, but there are those who see precious metals and holding coins as important to combat the chaos that will ensue upon such an event. I don’t know about all that but at a minimum, it can act as a hedge against inflation.
So, have I convinced you? Are you ready to take the next step in starting a coin collection? While this concludes my recommendation to you, let it serve as the start of your life long journey.