Everybody knows that coin collecting is a work of a lifetime.
Some wealthy individuals can dive in late and catch up quick, but most collectors spend decades painstakingly acquiring what they want.
Is the money well spent?
We cannot quantify love of hobby, or love of the activity, but we can quantify other things.
The Maria Theresa taler that I bought in 1967 for $1.95 today is worth $11.
The current price is 5.64 times my purchase price.
Interestingly, this silver coin failed to keep up with inflation.
The Consumer Price Index is up 7.5 times.
That might be considered a failure, but I was also purchasing new proof sets from the Mint at the time.
The 1969 set that I obtained directly from the Mint cost me $5.
I can buy it now on eBay today for $5.95.
That means if I want to sell it to a dealer, it is probably worth $2-$4.
Not only did I fall behind inflation, but I did not even keep the paper value that I put into the set.
That is why I have written that average collectors would be better off avoiding base metal coins completely, especially if they are playing in the field of modern issues.
Those are metals like copper, bronze, zinc, and nickel.
Why should they want to avoid base metals?
Aren’t cents the most popularly collected coins?
Cents are popular.
But if you are worried about making grading mistakes or picking a field that declines when you want to sell 30 years in the future, precious metals have an advantage.
By sticking to silver and gold coins, collectors have a built-in level of financial protection.
I knew when I bought the Maria Theresa taler that I was buying a hunk of silver, not a collector coin.
Silver value has held up better than the supposedly more collectible 1969 proof set.
Had you purchased the 1984 $10 Olympic gold coin for the $352 issue price, you ended up buying a coin that has turned out to be very common.
It could be a loser.
However, the gold melt value is now nearly double issue price. It is presently $612.
If only all buying mistakes turned out to be so profitable.
Naturally, though, collectors educate themselves over time.
They learn how to grade.
They learn how to evaluate permanent scarcity, where demand from collectors will endure for 30 years or 300.
They will not need the safety net provided by melt value then.
However, anyone who walks on a tightrope for the first time with coin purchases might feel better knowing that the underlying metal value is there to catch them.
Buzz blogger Dave Harper won the Numismatic Literary Guild Award for Best Blog for the third time in 2017. He is editor of the weekly newspaper "Numismatic News."
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