The effect of young strong buyers

Zoins

@BryceM posted something interesting in the Is this hobby dying? which got me thinking...

If there were strong YNs buying coins, would the end result be good or bad for the hobby if rarities disappeared off the market for decades?

When I was in college, there kids already investing in the stock market for years in high school, but what if they were investing in rare coins?

@BryceM said:
Coin collectors have always been old guys. Good thing too, otherwise there would be even fewer opportunities to acquire what is often squirreled away.

jmlanzaf

@Zoins said:
@BryceM posted something interesting in the Is this hobby dying? which got me thinking...

If there were strong YNs buying coins, would the end result be good or bad for the hobby if rarities disappeared off the market for decades?

When I was in college, there kids already investing in the stock market for years in high school, but what if they were investing in rare coins?

@BryceM said:
Coin collectors have always been old guys. Good thing too, otherwise there would be even fewer opportunities to acquire what is often squirreled away.

Inevitably, 95% of them would sell while building their family.

ricko

There are plenty of old collectors, and lots of young collectors.... And a huge segment in between. The hobby is alive and well. This concern has been voiced for the 24 years I have been on the forum.... Collect coins, have fun and stop worrying. Cheers, RickO

Dr_Bones

It is not a new phenomenon. I took over the pursuit of finishing my fathers collection. Collectively we have been working on it for 50 years. Half of what I own was purchased in the 1970s and 1980s. From research, I know of multiple coins (2-3 known) that were sold in the 1980s and have never been certified or sold since. Many of the low population coins only have 4-5 auctions sales records since the 1860s and 1870s. Not uncommon for collectors/families to sit on them for years.

Walkerfan

It’s not just the ‘old guys’ who are buying. The young guys will, inevitably, become strong buyers, as soon as they have the financial means, which is, Usually, in their 30s or 40s. So, I think it is the ‘in-between’ guys who are the strongest buyers. Jmho. The ‘real old guys’ are worried about selling off their assets after retirement. My advice is to just enjoy the hobby, at any age. It can provide lifelong enjoyment, Regardless of how much you spend.

Maywood

@Zoins said: If there were strong YNs buying coins, would the end result be good or bad for the hobby if rarities disappeared off the market for decades?

When I was in college, there kids already investing in the stock market for years in high school, but what if they were investing in rare coins?

I doubt we'd see things "dissappearing" because people under 40 today don't seem to think like that, at least not from my experience. They are either saving to retire early or flipping whatever the commodity might be, but the end result is that nothing is held for very long. That includes stock, collectibles, real estate or the new crypto.

FlyingAl

The young buyers that I think you would classify as "strong" are usually dealers.

Using coins as an investment, particularly when you have different options at a younger age is an idea that I think very few young collectors with the knowledge to buy strongly would do. The stock market consistently outperforms the rare coin market, particularly in the long run. I do not consider for a second truly investing in the coin market because coins are a hobby. If I make money on my coins, great. But whatever "investing" I do is really cherrypicking and then flipping. I can calculate my risk and reward very closely and there's not a high degree of error in the strategy provided I can spot the varieties correctly.

When collectors get into their later 30s, early 40s or perhaps earlier, and they have a solid financial base then that's where you're going to start seeing your strong buyers. Of course, there will be exceptions.

coinbuf

I fail to see how a twenty something power lifter will have any effect on market pricing.

JWP

The younger generation doesn't trust the WALL STREET, so they buy Bit Coin. Us older collections love coin, stock bullion, and know how to invest.

WilliamF

@JWP said:
The younger generation doesn't trust the WALL STREET, so they buy Bit Coin. Us older collections love coin, stock bullion, and know how to invest.

I'm young and I don't trust Wall Street or Bitcoin... My dad has been very heavily involved in the stock market for a long time and I get a lot of advice from him on investing, I opened a Roth IRA last year and have been putting a fair bit of money into it already, I don't think most 20 year-olds even think about an IRA... I have invested in precious metals as well, good to have a diverse portfolio.

@jmlanzaf said:
Inevitably, 95% of them would sell while building their family.

>
I agree with this as well, I haven't started a family yet but, if/when I do, I plan to sell a fair bit of my collection as needed, I don't necessarily want to but I realize it will probably be necessary, and then the coins that have been in my hands for a few years will be back on the market, it's all just a big cycle

Rob9874

@jmlanzaf said:
Inevitably, 95% of them would sell while building their family.

Do most numismatists follow the same pattern?
1. Get involved at a young age, which plants the seed
2. Become an adult, and other things consume your interests and disposable income
3. Get older and have more disposable income, and return to that childhood love of coins

JWP

@WilliamF Great- use the roth and you can still invest in an401k with your employer if offered. You are headed in the RIGHT direction. I've started my 3 daughters with Roth IRA's and all are contributing on a monthly plan. Congrats

winesteven

@JWP said:
@WilliamF Great- use the roth and you can still invest in an401k with your employer if offered. You are headed in the RIGHT direction. I've started my 3 daughters with Roth IRA's and all are contributing on a monthly plan. Congrats

Back in the mid to late 1980’s, when my two children were teenagers and had summer jobs, we set them up with Roth IRA’s. We offered them a 100% match on whatever they would put in. They each chose to put in half their gross earnings, since with mom and dad’s match, that brought the total contribution to 100% of earnings, the maximum allowed. Now we’re not talking big bucks, since these were summer jobs.

This taught our kids several important financial lessons. By the way, our “match” ended when they each had real jobs as adults. My “kids” are now 49 and 51. Despite the 2022 market losses, when they each look at the values of their retirement accounts, “it’s like fungus growing in a closet” - they ask, “Where’d all that come from?”

Steve

alefzero

There is a good question behind the original one. It is the point of motivation. Even if we replace collectors intergenerationally at par, will the same fraction be interested in a lifetime of building and maintaining (upgrades, etc) organized sets?

Used to be folks stayed with employers for their entire working lives, bought their homes and stayed there, integrating into the communities. That doesn't work anymore. I forget the number of years between employment changes, but the rapidity is pretty fast typically. Part of that is to get income step ups rather than rely on anemic incremental raises. It is not out of selfishness so much as the realities of the second part. Home ownership is not the simple reality for younger generations. Maybe the real estate markets will crash and lenders will accommodate more, but not something most would forecast.

That is where the problem comes in. Some have disposable income earlier, but far fewer than in the past. Probably enough to maintain values of condition census coins. I would guess that most of the rest of the market will stall at some point as we greyhairs and baldies die off or cash in our coin chips, regardless whether there is a one for one replacement by younger collectors.

As to motivation, like holding onto an existing job, the hobby's culture has evolved two ways: a lot more flipping and a reduction of the distinction between collector and dealer, though a few seem to disagree with me on that. I believe the internet has completely upended the paradigm that accommodates full-time dealers. It might not be felt by all yet; but I believe it will. And whether one made great money over the past 25 to 50 years is completely irrelevant. The marketplace is becoming flat and transparent. The best coins might find strong hands for a while, though some that were on the market maybe once in a generation are now seen after ten or twelve years.