Collect Coins

Collecting coins is easy, and all coins are good to have. Coin collecting is fun, safe and educational for you and your child. Most people think that you have to buy coins to start a collection, but you can begin with just the change in your pocket.

Steps

  1. Don't assume that all old coins will be in very poor condition. If you are buying coins, you can expect such coins to be in respectable condition, even if it is over 500 years old. Of course, as the age of the coin increases, the condition, if very good, will add more value.
  2. Find something to hold your coins. This does not mean that you have to buy fancy coin holders (although this would keep them in better condition). Coin holders can be fairly cheap or you can use an old shoe box or peanut butter jar.
  3. Store in a safe place. If you are buying expensive coins, invest in a safe-deposit box and containers that will not destroy the numismatic value of your coins.
  4. Decide what you want to collect.
    • You might like to collect foreign coins or your home country's currency.
    • You might like to collect smaller denominations or larger denominations
    • You might like to collect circulated coins in coin folders to try to complete a series such as your own life span.
    • You might like to collect uncirculated coins which have been available in the United States since the 1950s.
    • You might like to collect proof sets which are uncirculated coins prepared especially for collectors.
    • You might like to collect silver proof sets which are very beautiful (more affordable than gold) and their value will increase (or decrease) as the value of silver increases (or decreases).
  5. Ask friends and relatives if they have old change, and then, ask if you can have it or offer to buy it, depending on what feels appropriate.
  6. Check with your local bank or financial institution. Many will sell you rolls or bags of coins at face value.
  7. Expand your collection by going to coin expos. You can also visit your local coin dealer for buying coins and almost all the time there's a cheap coin bin that is suitable for kids and adults alike.
  8. Note that some people advise collecting coins out of pocket change. Once a modern coin has been in circulation, it is typically only worth its face value, although there are notable exceptions.
  9. Understand the grading of coins. Grading coins is often difficult and there is a tendency for people to over grade their own coins. Also beware that the UK grading system grades coins more strictly than the US system. For example a US graded "mint state" might not be as good as an "extremely fine" coin in the UK. You should learn to grade coins "by the book." The American Numismatic Association has established standards for each of the US series. There is a tendency for the grading of actual coins for sale to be market graded or graded more leniently based on what the market will bear. If you keep in mind the strictest grading and use that when pricing coins for purchase, you will seldom go wrong.
  10. Avoid the purchase of problem coins. Coins with damage or deficiencies that go unnoticed at the time of purchase will sell for substantially less to a sharp-eyed coin dealer or numismatist.
    • There is another saying in numismatic circles, "“The bitterness of poor quality remains long after the sweetness of low price is forgotten,” a statement generally attributed to Benjamin Franklin (though not about coins). These deficiencies will always stick out like a sore thumb once the coin is in your collection and will serve to diminish your pleasure of an otherwise enjoyable hobby. Keep in mind that coins with deficiencies (such as having been cleaned using mildly abrasive cleaning methods, being slightly bent, gouged) will be worth substantially less than a coin without problems. Such coins might be valued at 5-35% of the price of a problem free coin.
  11. Note that the US grading system also has trouble with grading hammered coins, those which were made by hand (with a hammer and hand held dies) as opposed to milled coins (which are made by machine).
  12. Buy coins because you enjoy them, not because you hope to get rich. It is best to realize that what you like about coins, others will as well. Therefore, the numismatic value of your collection should grow over time, though not necessarily. Coins are often good investments, growing in value faster than the rate of inflation and, if you buy and sell carefully, there is money to be made.
  13. "Buy the book before the coin". This is an oft-used saying in numismatics that means learn about the coins before spending a lot of money on them. One of the best ways to "buy and sell carefully" is to read the book before you buy the coin. There are many books on the market. First the catalog with basic information and price estimates. Then there are books available on individual series (the Lincoln Cent), types (ancient coins, mint errors, gold coins, tokens and medals etc.) There are books on grading coins which is important to determine value. Books are available on most any topic of coin collecting or Numismatics as it is more formally known. Knowledge is how we tell the difference between a rare coin and one that is common.
  14. Join a coin club or numismatic association. Numismatic associations provide a range of opportunities to get information or buy and sell coins: Members of an association will meet regularly, young collectors can get advice from their well-versed colleagues, some of the members sell coins at comparatively low prices, and one will be informed about upcoming events. So, joining a numismatic association can help you quite a lot to further your hobby.



Tips

  • Remember that grading, even by a professional service, is subjective and that grading standards change over time.
  • Expect dealers to charge premiums (usually 20 percent on either purchases or sales). To avoid being overcharged, however, find a reputable dealer and use an equally reputable coin price guide. For example, in the USA, the Guide Book of United States Coins, or the Red Book are the best.
  • Always hold coins by the edges. This will prevent wear and fingerprints on the faces, where it really counts.
  • If you are going to purchase a rare issue that is often counterfeited or a coin that jumps dramatically in value between grades, it is a good idea is to buy a "slabbed" coin, i.e., a coin graded by an independent grading service such as PCGS or NGC. This will provide a large measure of security in knowing that the coin is genuine, properly valued and easily salable.
  • Don't be greedy and just collect coins for money. Take passion in owning the coins and in the history. Make it a worthwhile hobby.
  • If you are collecting with a child, then the best thing to do is probably to collect foreign coins. You can get some nice old, original foreign coins at reasonable prices. They might also be relatively rare. Since there is not much collector demand for such pieces, there are bargains to be had for the sharp-eyed child. You can also weave in learning about the culture and history at the same time.

Warnings

  • Many times when purchasing coins, some deals can be "too good to be true". Always inspect coins before buying, and look for signs that the coin could be counterfeit or a replica of the original. You may find later when you get ready to sell that the coin you thought was worth thousands is actually a mass produced replica or counterfeit.
  • Avoid keeping coins in jars, shoe boxes, or most types of over-the-counter plastic containers. If the coins rub together, their value can be destroyed. Also, some materials can cause chemical reactions that can adversely affect the coin's value.
  • Polyvinyl chloride can damage your coin. Over a period of time, the sticky green film can migrate from the container to the coin can cause severe damage, even etching the coin surface.
  • Make sure that you have enough information about the coins you're going to buy. There have been widespread reports about counterfeit old coins that are being produced in huge numbers in China. If you buy coins through the internet, be sure to check that the seller has a good reputation.
  • Avoid collecting ancient Chinese cash coins, because they are easy to imitate and you have to be an expert at Chinese coins in order to verify if they are authentic or not.
  • Know that coins are considered speculative investments, which is to say, their values (and prices) can go up or down.
  • Be careful about purchasing coins from online auctions. Unscrupulous sellers often over-state the grade or conditions of coins. Also, there are widespread reports of sellers not delivering coins at all.

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