-- "i'd bet there are members who wouldn't pay 8% of a coin's value to a CardCompany over four months, but who would willingly save over those same four months to pay a 10% price increase to a dealer.......................just to stay out of debt!!!!" --
That would probably include me. But the fact of the matter is that too many collectors are too quick to purchase NOW! out of fear that prices are rising quickly and that another coin won't come along. There are cases, of course, where that's true. But, in the areas where the vast majority of us collect, it simply isn't true enough to justify going into debt.
well then, let's dispense with the four month time lapse and be more realistic, while keeping in mind that i'm not being arguementative and/or pressing my point. sometimes it's just prudent to buy and pay some interest in the short term, rather than wait for oppurtunity to arrive when financial arrangements allow for the purchase with cash which may now be more expensive. also, in todays market i figure the sooner i close the gap between the buy--sell spread the better.
on whole, i think it takes each of us understanding our own conditions as well as the area we collect. this in itself goes a long way to dictating when it might be right or wrong to "extend" ourselves. in the perfect world it would be nice to always be flush with little/no debt. i find that happens very little of the time.
<< <i>Coins being the piss poor investments that they are, I find no argument that would make sense to purchase a coin(s) on borrowed money.
this could be said for perhaps the number one debt builder in America-----a new car. i'd have to view them as a terrible investment, albeit a neccessity, and almost noone thinks twice about taking out a long term loan for a purchase(don't even get me started on leases!!) i guess that's why i'm 52 and have never had a new car, and almost certainly never will. >>
I mentioned the car debacle in my post, too. I don't believe in financing new automobiles--they are a horrible purchase, and a sure loser. Most people do it, and most people shouldn't. A nice pre-owned car can be had for a fraction of the cost (and paid for in cash), and an even better way, and what I used to do, was purchase a semi-collectible or vintage car, fix it up or maintain it well, and sell it for more than I purchased it 3 years down the road. I've done that with every car I've owned except the most recent one, which I purchased new for the first time (but I did pay cash).
There are a growing number of flippers frequenting this board that appear to be buying new junk by the hundreds and even thousands on credit, hoping for a quick profit. I see the fear in their eyes and the panic as they post when the prices aren't realizing what they expected. Any warning about purchasing coins on credit is hopefully read by these people (but I doubt it, since they're over on the FDC and "w" threads).
I don't finance coins. I have done layaways and I have done credit cards (paid off next payment). I have had used cars and new cars. I have NEVER had any problems with the new cars. With the used ones, I have had many different problems over the last 20+ years. I have a kid now and prefer the new safety features of the newer cars. And, the cars I buy cost almost the same used as new sometimes (go price Honda Accords ).
While it might make sense to finance a rare/key new coin, for the vast majority, it is safer not to do so. On common coins, I don't think one should.
I have a little 'mad money' stored away for coins and when that dries up, it's time to either wait until it builds up again or sell a few coins to replenish the 'funds'.
Never had a credit card until I was 40 (makes it easy to stay out of debt).
"Gold is money, and nothing else" (JP Morgan, 1912)
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
A very interesting question, that doesn't have a simple answer. Per the original description of "debt" in the Post, the conclusion must be made that a coin once purchased doesn't have value that equals or exceeds the "debt" created. If the basis of the answer is that the opposite of debt is cash that is unencumbered, now or in the future, and available to dispose without regard to priority, then such an action of and in itself creates a type of "debt" in that the unencumbered cash is not in a bank collecting interest. But what if the coin does have a value that is equal to the "debt" created to purchase the coin? What if it has a "hold" value 10 years out? What if the coin gains 6-8% yearly in a 3 year short term, and you borrowed by using equity from your propertyat 8%, but still realize a tax gain, by way of deduction? It would seem that cash flow and servicing the debt could be beneficial in the right circumstances. Is purchasing life insurance a debt? Is a 3% 25 year Sallie Mae loan for education a debt, if four years out you are able to service the loan, and save a certain amount that equals the loan payment in a 5% interest bearing account? This would almost be an example of using "free" money without risk. As to saving to buy a house cash, or a car cash, what is the "gain" by such an action, that avoids "debt"? That the house is now owned free and clear without regard to a tax deduction benefit, or a car payment is being saved in an interest bearing account that is a greater yield than the cash spent for the car being in an interest bearing account? If we make the assumption that our collector grade coins have some worth in the market place, then at least a partial recovery of cash position is possible, which is not any different than Real Estate or a car. A car creates a form of "debt'-gas, oil, maintenance, etc.. Two things that these various purchases have in common is that they are purchased with a certain amount of faith of stabilization(and possibly a little profit return) and are purchased for our ultimate enjoyment. Just some thoughts that I leave to others wiser than me to decide the worth. Yes, I would take a "debt" position to purchase coins. Respectfully, John Curlis
I once borrowed millions of dollars in order to buy the entire Share Collection in order to acquire just a few spectacular coins. As I sold off the ones I didn't want, I repaid the debt.
The coins?
1844 seated dollar PCGS MS65 1852 seated dollar NGC MS65 1872-CC seated dollar PCGS MS65 1873-CC seated dollar PCGS MS65 1878-CC trade dollar PCGS MS66
Absolutely. Knowing full well that John Jay Pittman took a second mortgage on his home prior to attending the Farouk sale in Cairo is my rationale for doing so. J.J.P. was obviously way ahead of most of his time when he aquired unique or nearly unique coins in such risk/reward situations, but even liberal calculations on the return for long term aquisitions made on borrowed funds today can still be rewarding if one thoroughly researches and identifies such opportunities.
<< <i>Debt is not a good thing for anything except perhaps a modest home and education at a last resort. Debt is killing this nation and sucking the life blood from everyone who succumbs to it.
54 years old and debt free.....
If you don't have the money, don't buy it. >>
Agree. I ran myself into debt a few years ago buying coins and other hobby crap that I didn't need but just "had" to have it. Worst mistake I ever made. Between that, relandscaping our yard and funding a trip to Hawaii we ran ourselves into heavy debt. In August of 2005 the wife and I slapped ourselves with a dose of common sense, held a budget meeting, slashed away from our budget that which we didn't need and started hammering away at our debt. I'm proud to say that we are now roughly 8 months away from being debt free(besides the house payment). I have been tempted at times to do it again, but everytime I get the urge to buy an expensive coin I dig out our credit card bills from 2005 as a reminder of where we were and how we don't want to go back to that. Any coin I buy now is from saving $10 here and there and from gift money. The wife and I agree to consult one another before one of us make a purchase over $25(not including gasoline, groceries and regular bills).
I would never buy a coin on credit. I have no debt in my life other than my home mortgage and I make extra payments on that each month. I'm a believer in paying off every bill, in full and on time, all the time.
<< <i>Coins being the piss poor investments that they are, I find no argument that would make sense to purchase a coin(s) on borrowed money.
this could be said for perhaps the number one debt builder in America-----a new car. i'd have to view them as a terrible investment, albeit a neccessity, and almost noone thinks twice about taking out a long term loan for a purchase(don't even get me started on leases!!) i guess that's why i'm 52 and have never had a new car, and almost certainly never will. >>
-- "I once borrowed millions of dollars in order to buy the entire Share Collection in order to acquire just a few spectacular coins. As I sold off the ones I didn't want, I repaid the debt." --
You see, that's one of the differences between us. I would have simply written a check.
Mrs. L would beat me like a red-headed stepchild if I did.
Always took candy from strangers Didn't wanna get me no trade Never want to be like papa Working for the boss every night and day --"Happy", by the Rolling Stones (1972)
If I refused to use credit to buy coins, my collection would be far smaller. I say that not because I have a huge level of debt, but because I would be compelled to maintain a much higher stash of idle cash to take advantage of unanticipated buying opportunities. So the bottom line is that I think I'm better off staying (more or less) fully invested and using short term debt when necessary. It doesn't bother me. It's long term debt that causes the problems.
Andy Lustig
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Debt. Most of us have it. Purchasing objects with cash when debt exists in other areas is the same as borrowing anew. The key is whether you have the ability to survive the loss of value of any significant object you purchase. If not , it is a mistake to purchase and is dangerous speculation. and/or foolhearty.
No, and never will go into debt for a coin. This is a hobby for me and going into debt is not something I enjoy. I have however bought large dollar coins on a payment schedule.
I have on several occasions, and then paid it off as quickly as possible. I definitely try to avoid doing it though as I don't like living with debt. I'm am carrying much more debt right now than I like right now, but it is still only about $1,600 and I should be able to get rid of that within the next month or two. The only reason I have that is because of unexpected medical bills from early this year. (Two days earlier and they would have come in under last years bills which I had already met my deductable on. As it was I had to carry much of the bill myself instead of on insurance.) But then I should be debt free again.
<< <i>The key is whether you have the ability to survive the loss of value of any significant object you purchase. If not , it is a mistake to purchase and is dangerous speculation. >>
True! Each of us has to weigh our own circumstances and comfort level with the amount and duration of any debt we incur. First thing would be to assess the item being purchased; it might be something you have been wanting for a long time or an unexpected deal too good to pass up. I wouldn't borrow $8K to buy an unopened box of 10 3 piece 20th Anniv ASE sets I know that. Also your ability to repay the debt from current income as well as your faith in your income security. There are some whose jobs are a lot more secure than others. I hate owing money or buying with a CC and paying for the past over time, but I would give each buying opportunity careful consideration and then pass or play accordingly.
Using borrowed funds to buy a coin for a collection isn't smart. Using borrowed funds to buy a coin for re-sell can be. As far as millionaires are concerned Money does one thing. It works for them. As far as the rest of us are concerned, it works against us. So if you don't have it, don't borrow it for your desires.
<< <i>...the fact of the matter is that too many collectors are too quick to purchase NOW! out of fear that prices are rising quickly and that another coin won't come along. There are cases, of course, where that's true. But, in the areas where the vast majority of us collect, it simply isn't true enough to justify going into debt. >>
'Guilty' on both points, rising prices and future availability of the type of coins I'm collecting these days. (Yep, I've delayed my "self-imposed buying freeze", at least until my wife is officially in school, later this month ). And I'm doing it on credit. But not in huge amounts, and I should have it paid off before too long (I hope!).
Exclusively collecting Capped Bust Halves in VF to AU, especially rarity 3 and up. Joe G. Great BST purchases completed with commoncents123, p8nt, blu62vette and Stuart. Great coin swaps completed with rah1959, eyoung429 and Zug. Top-notch consignment experience with Russ.
Suppose I won a few million in a lottery and planned to take the entire 90 or whatever days to claim my winnings. If I wanted one or more of those high dollar Morgans in the upcoming Heritage auctions would I borrow a couple hundred K to get them? Probably.
<< <i>Each of us has to weigh our own circumstances and comfort level with the amount and duration of any debt we incur. First thing would be to assess the item being purchased; it might be something you have been wanting for a long time or an unexpected deal too good to pass up...Also your ability to repay the debt from current income as well as your faith in your income security. There are some whose jobs are a lot more secure than others. I hate owing money or buying with a CC and paying for the past over time, but I would give each buying opportunity careful consideration and then pass or play accordingly. >>
"Suppose I won a few million in a lottery and planned to take the entire 90 or whatever days to claim my winnings. If I wanted one or more of those high dollar Morgans in the upcoming Heritage auctions would I borrow a couple hundred K to get them? Probably. "
Ahh, The fantasies of boys turn from sex to lotteries to coins with age
Most people are in debt denial, and very few are debt free. If you have a coin collection worth 50K, and a 100K mortgage, your collection is made possible by the mortgage, as you could pay down the mortgage 50% by selling the coin collection. Growing up in a rather poor family, I am terrified of debt, I paid my second house off when I was 35, this leaves ample funds for those little round metal toys
Robert Scot: Engraving Liberty - biography of US Mint's first chief engraver
As a staunch loather, hater and abhorer of debt of any kind, I would not buy coins on debt. Now, if a person collected coins in the $50- $250 and a coin they really needed came available for sale, then a small debt that could easily be repaid would not be too bad.
Buying a popular coin with great eye appeal with debt is certainly much better than paying for a fancy dinner, a night or two for an expensive hotel suite, or for any other frivolous consumption that is so common with people these days.
<< <i>Buying a popular coin with great eye appeal with debt is certainly much better than paying for a fancy dinner, a night or two for an expensive hotel suite, or for any other frivolous consumption that is so common with people these days. >>
Yep, a lot of folks go into debt for stuff that I would never go into debt for.
I have for a very few, select items for which the chance to buy them is rarer than the coin itself. For items like that, I have never regretted going into some debt to acquire them. However, the coin always stays in the seller's holder until it is paid off -- the joy of taking a hammer to a slab once you've paid it off is sweet indeed.
Generally, however, my coin purchases for my own collection tend to be inexpensive and within the power of my checkbook.
I have in the past gone into debt for a coin but no more. I might lay one away for 90 days but no debt charges. The state of the economy doesn't allow that anymore.
"Im not young enough to know everything." Oscar Wilde
Collect for the love of the hobby, the beauty of the coins, and enjoy the ride.
Clothes make the man. Naked people have little or no influence on society.
Comments
That would probably include me.
on whole, i think it takes each of us understanding our own conditions as well as the area we collect. this in itself goes a long way to dictating when it might be right or wrong to "extend" ourselves. in the perfect world it would be nice to always be flush with little/no debt. i find that happens very little of the time.
I give away money. I collect money.
I don’t love money . I do love the Lord God.
<< <i>Coins being the piss poor investments that they are, I find no argument that would make sense to purchase a coin(s) on borrowed money.
this could be said for perhaps the number one debt builder in America-----a new car. i'd have to view them as a terrible investment, albeit a neccessity, and almost noone thinks twice about taking out a long term loan for a purchase(don't even get me started on leases!!) i guess that's why i'm 52 and have never had a new car, and almost certainly never will.
I mentioned the car debacle in my post, too. I don't believe in financing new automobiles--they are a horrible purchase, and a sure loser. Most people do it, and most people shouldn't. A nice pre-owned car can be had for a fraction of the cost (and paid for in cash), and an even better way, and what I used to do, was purchase a semi-collectible or vintage car, fix it up or maintain it well, and sell it for more than I purchased it 3 years down the road. I've done that with every car I've owned except the most recent one, which I purchased new for the first time (but I did pay cash).
There are a growing number of flippers frequenting this board that appear to be buying new junk by the hundreds and even thousands on credit, hoping for a quick profit. I see the fear in their eyes and the panic as they post when the prices aren't realizing what they expected. Any warning about purchasing coins on credit is hopefully read by these people (but I doubt it, since they're over on the FDC and "w" threads).
I don't finance coins. I have done layaways and I have done credit cards (paid off next payment).
I have had used cars and new cars. I have NEVER had any problems with the new cars. With the used ones, I have had many different problems over the last 20+ years. I have a kid now and prefer the new safety features of the newer cars. And, the cars I buy cost almost the same used as new sometimes (go price Honda Accords
While it might make sense to finance a rare/key new coin, for the vast majority, it is safer not to do so. On common coins, I don't think one should.
I've been told I tolerate fools poorly...that may explain things if I have a problem with you. Current ebay items - Nothing at the moment
And yes I have put a have too have on the credit card for a couple of months before.
coins for sale at link below
https://photos.app.goo.gl/nsHQNq5HMDcCrpHm8
I have a little 'mad money' stored away for coins and when that dries up, it's time to either wait until it builds up again or sell a few coins to replenish the 'funds'.
Never had a credit card until I was 40 (makes it easy to stay out of debt).
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
-------------
etexmike
The coins?
1844 seated dollar PCGS MS65
1852 seated dollar NGC MS65
1872-CC seated dollar PCGS MS65
1873-CC seated dollar PCGS MS65
1878-CC trade dollar PCGS MS66
Spectacular, irreplaceable examples all...
"Everything is on its way to somewhere. Everything." - George Malley, Phenomenon
http://www.american-legacy-coins.com
<< <i>Debt is not a good thing for anything except perhaps a modest home and education at a last resort. Debt is killing this nation and sucking the life blood from everyone who succumbs to it.
54 years old and debt free.....
If you don't have the money, don't buy it. >>
Agree. I ran myself into debt a few years ago buying coins and other hobby crap that I didn't need but just "had" to have it. Worst mistake I ever made. Between that, relandscaping our yard and funding a trip to Hawaii we ran ourselves into heavy debt. In August of 2005 the wife and I slapped ourselves with a dose of common sense, held a budget meeting, slashed away from our budget that which we didn't need and started hammering away at our debt. I'm proud to say that we are now roughly 8 months away from being debt free(besides the house payment). I have been tempted at times to do it again, but everytime I get the urge to buy an expensive coin I dig out our credit card bills from 2005 as a reminder of where we were and how we don't want to go back to that. Any coin I buy now is from saving $10 here and there and from gift money. The wife and I agree to consult one another before one of us make a purchase over $25(not including gasoline, groceries and regular bills).
Positive BST Transactions (buyers and sellers): wondercoin, blu62vette, BAJJERFAN, privatecoin, blu62vette, AlanLastufka, privatecoin
#1 1951 Bowman Los Angeles Rams Team Set
#2 1980 Topps Los Angeles Rams Team Set
#8 (and climbing) 1972 Topps Los Angeles Rams Team Set
<< <i>Never have, never will. Very foolish and reckless thing to do, IMO. It's no different than compulsive gambling... >>
Like card counters in blackjack?
<< <i>Coins being the piss poor investments that they are, I find no argument that would make sense to purchase a coin(s) on borrowed money.
this could be said for perhaps the number one debt builder in America-----a new car. i'd have to view them as a terrible investment, albeit a neccessity, and almost noone thinks twice about taking out a long term loan for a purchase(don't even get me started on leases!!) i guess that's why i'm 52 and have never had a new car, and almost certainly never will.
Virtual total agreement.
Just one time. I had to have this:
PCGS VF30
I would do it again for a shot at a 1792 Half Disme.
Great transactions with oih82w8, JasonGaming, Moose1913.
You see, that's one of the differences between us. I would have simply written a check.
Mrs. L would beat me like a red-headed stepchild if I did.
Didn't wanna get me no trade
Never want to be like papa
Working for the boss every night and day
--"Happy", by the Rolling Stones (1972)
Mrs. L would beat me like a red-headed stepchild if I did.
If that's your only worry, may I suggest option 3?
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
and/or foolhearty.
<< <i>The key is whether you have the ability to survive the loss of value of any significant object you purchase. If not , it is a mistake to purchase and is dangerous speculation. >>
True! Each of us has to weigh our own circumstances and comfort level with the amount and duration of any debt we incur. First thing would be to assess the item being purchased; it might be something you have been wanting for a long time or an unexpected deal too good to pass up. I wouldn't borrow $8K to buy an unopened box of 10 3 piece 20th Anniv ASE sets I know that.
Also your ability to repay the debt from current income as well as your faith in your income security. There are some whose jobs are a lot more secure than others. I hate owing money or buying with a CC and paying for the past over time, but I would give each buying opportunity careful consideration and then pass or play accordingly.
Name a coin that would force you to break your vow, even if the price was on the aggressive side.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Using borrowed funds to buy a coin for re-sell can be. As far as millionaires are concerned
Money does one thing. It works for them.
As far as the rest of us are concerned, it works against us. So if you don't have it, don't borrow it for your desires.
``https://ebay.us/m/KxolR5
<< <i>...the fact of the matter is that too many collectors are too quick to purchase NOW! out of fear that prices are rising quickly and that another coin won't come along. There are cases, of course, where that's true. But, in the areas where the vast majority of us collect, it simply isn't true enough to justify going into debt. >>
'Guilty' on both points, rising prices and future availability of the type of coins I'm collecting these days. (Yep, I've delayed my "self-imposed buying freeze", at least until my wife is officially in school, later this month
Joe G.
Great BST purchases completed with commoncents123, p8nt, blu62vette and Stuart. Great coin swaps completed with rah1959, eyoung429 and Zug. Top-notch consignment experience with Russ.
<< <i>Each of us has to weigh our own circumstances and comfort level with the amount and duration of any debt we incur. First thing would be to assess the item being purchased; it might be something you have been wanting for a long time or an unexpected deal too good to pass up...Also your ability to repay the debt from current income as well as your faith in your income security. There are some whose jobs are a lot more secure than others. I hate owing money or buying with a CC and paying for the past over time, but I would give each buying opportunity careful consideration and then pass or play accordingly. >>
I agree completely.
Ahh,
The fantasies of boys turn from sex to lotteries to coins with age
<< No, and never will go into debt for a coin. This is a hobby for me and going into debt is not something I enjoy. >>
Stuart
Collect 18th & 19th Century US Type Coins, Silver Dollars, $20 Gold Double Eagles and World Crowns & Talers with High Eye Appeal
"Luck is what happens when Preparation meets Opportunity"
Buying a popular coin with great eye appeal with debt is certainly much better than paying for a fancy dinner, a night or two for an expensive hotel suite, or for any other frivolous consumption that is so common with people these days.
Tyler
<< <i>Buying a popular coin with great eye appeal with debt is certainly much better than paying for a fancy dinner, a night or two for an expensive hotel suite, or for any other frivolous consumption that is so common with people these days. >>
Yep, a lot of folks go into debt for stuff that I would never go into debt for.
Generally, however, my coin purchases for my own collection tend to be inexpensive and within the power of my checkbook.
Betts medals, colonial coins, US Mint medals, foreign coins found in early America, and other numismatic Americana
<< <i>But of course!!
If you see a "must have" coin that you know is undervalued, what's 8% juice on a 50% gain?
that's the spirit!
heck yes
and even dollar cost average on hot movers
Oscar Wilde
Collect for the love of the hobby, the beauty of the coins, and enjoy the ride.
Clothes make the man. Naked people have little or no influence on society.
RegistryNut