Options
Coin collecting for young adults
kevinj
Posts: 972 ✭✭✭
One age group often over looked in getting involved into coin collecting are young adults, right out of college, beginning their lives and such.
Most do not start collecting at this point, even if they enjoyed it as a youth.
This is actually a great time to get into collecting for the long term investment potential.
Below is an article I wrote on this subject.
Coin Collecting for Young Adults
Most kids are introduced and enjoy coin collecting between the ages of 6 and 12 years, (first through sixth grade). Through their teenage years in high school and college, they are normally occupied with other activities such as sports, school functions, dating, and other interests.
When they are finished college, their primary focus is normally on starting a career, paying off loans, getting a house, marriage, kids, and other everyday tasks. Time is a commodity that is difficult to find during this period. Most young adults who enjoyed coin collecting as a kid, most likely might start again around the age of 35 when life slows down a little and they have an opportunity that they might enjoy.
The question is whether it is wise to begin collecting as a young adult? What benefits and incentives can be achieved if one starts purchasing coins right outside of college? At this point of your life, there is a drastic change in your financial situation and spare money is normally not readily available. But on the other side of the coin so to speak, investing it is better and more profitable to begin long term investments at an earlier age.
Coin collecting is the oldest hobby in America, but also from a different perspective, it is also a financial investment. Whether it be the value of the precious metal or the value of the coins themselves, one of our goals is to purchase coins that will increase in value of time.
Most gold, silver, and other precious metals will follow the general market value. These might be considered a hedge against the value of the U.S. dollar. As the dollar falls in value, the value of precious metals normally rise. When the stock market crashed in 2008, many investors turned their sights to silver and gold dramatically driving up their value. Silver went from roughly $9 per ounce in 2008 to a peak of $46 dollars in 2011. Gold went from $729 per ounce in 2008 to a peak of $1,856 in 2011. One might be an optimist in regards to our country, but the reality of our plight, with 19 trillion dollars in debt and growing, manufacturing decreasing from 55% of our GDP in 1965 down to less than 5% now, financial bubbles such as student debt waiting to burst, with China and other countries knocking our door attempting to replace our currency with theirs as the global standard, precious metals offer a safe haven if/when those dark days happen upon us. With gold and silver down from their 2011 peaks, this offers a good buy opportunity for these coins. Most financial analyst would stress not putting all of your eggs in one basket, as if that one basket collapses, then you lost all of your money. By investing some of your money in precious metals, you are prepared if the dollar fails, pulling with it many of the common stocks.
If considering precious metals such as silver or gold, one of the more important perspectives to understand is the base value of the precious metal as compared to the numismatic value. You can purchase gold and silver bars in many shapes and sizes with the cost being the base value of that previous metal. If you purchase a coin with the same amount of gold or silver, then the value is normally the base value of the precious metal, plus there can be an additional premium based upon the coin. There are many factors that can contribute to ascertaining the premium, with rarity and demand being two of the primary aspects. For example, the Walking Liberty half dollar, Franklin half dollar, and 1964 Kennedy half dollar all have the same about of silver, and the same value in the base price for their silver. But, the numismatic demand and value for the Walking Liberty half dollar is much greater than the Franklin half dollar, which is normally greater than the Kennedy half dollar. If given the option of these three, the best choice in using a financial consideration as your primary guiding incentive, then the best choice is the Walking Liberty half dollar. It is not that difficult to understand which series have greater demand, and a greater possible numismatic premium based upon demand.
Most coins are considered long term investments. A great book that can show many of the alternatives in investing in coins is Profit from Gold and Rare Coins now by Donald H. Kagin, Ph.D. This books not only goes into comparisons between different types of coins and the stock market, and provides an analysis of the many options available in coin collecting, it provides recommendations on the best way to invest your money based upon historical data and the author’s vast experience. You can visualize the upswing of coins as compared to most other investments, especially in the long term.
One of the greatest reasons to collect coins is for the enjoyment. When you invest in stocks, do you enjoy reading and learning about the history of the stocks and what they represent? The images used on coins represent the people, places, events from our countries past. They are symbolic in nature of the beliefs and principles of that era. They display the artistic talent and pride from those who endeavored to envision and create them. The more we understand them, the greater we enjoy and appreciate them. The more experienced we become in examining coins, the greater we can use this knowledge to fine tune skills such as grading and selecting coins that are better quality and have a higher potential to increase in value.
A hobby is also something that can be shared between parent and their children or grandchildren. Coin collecting is ageless, the bonds observed between different generations sharing or passing on their knowledge to others is priceless. It is truly the essence of the hobby. Would you want your child collecting sports cards that are simply cardboard and can be printed endlessly or perhaps something like benie babies that became an expensive fad and ended as quickly as it started. Teaching your children about coins can enlighten them into the many great aspects and enjoyments of learning while doing something fun.
If you are at that stage in your life where you are finished college, beginning your career, starting your family, and becoming independent, it is important to consider ways at this stage to invest your money for the long term, including retirement. Coins not only offer a tremendous opportunity for this, but you can also enjoy collecting as you expand your passion, knowledge, and portfolio into this wonderful world that millions have enjoyed.
Most do not start collecting at this point, even if they enjoyed it as a youth.
This is actually a great time to get into collecting for the long term investment potential.
Below is an article I wrote on this subject.
Coin Collecting for Young Adults
Most kids are introduced and enjoy coin collecting between the ages of 6 and 12 years, (first through sixth grade). Through their teenage years in high school and college, they are normally occupied with other activities such as sports, school functions, dating, and other interests.
When they are finished college, their primary focus is normally on starting a career, paying off loans, getting a house, marriage, kids, and other everyday tasks. Time is a commodity that is difficult to find during this period. Most young adults who enjoyed coin collecting as a kid, most likely might start again around the age of 35 when life slows down a little and they have an opportunity that they might enjoy.
The question is whether it is wise to begin collecting as a young adult? What benefits and incentives can be achieved if one starts purchasing coins right outside of college? At this point of your life, there is a drastic change in your financial situation and spare money is normally not readily available. But on the other side of the coin so to speak, investing it is better and more profitable to begin long term investments at an earlier age.
Coin collecting is the oldest hobby in America, but also from a different perspective, it is also a financial investment. Whether it be the value of the precious metal or the value of the coins themselves, one of our goals is to purchase coins that will increase in value of time.
Most gold, silver, and other precious metals will follow the general market value. These might be considered a hedge against the value of the U.S. dollar. As the dollar falls in value, the value of precious metals normally rise. When the stock market crashed in 2008, many investors turned their sights to silver and gold dramatically driving up their value. Silver went from roughly $9 per ounce in 2008 to a peak of $46 dollars in 2011. Gold went from $729 per ounce in 2008 to a peak of $1,856 in 2011. One might be an optimist in regards to our country, but the reality of our plight, with 19 trillion dollars in debt and growing, manufacturing decreasing from 55% of our GDP in 1965 down to less than 5% now, financial bubbles such as student debt waiting to burst, with China and other countries knocking our door attempting to replace our currency with theirs as the global standard, precious metals offer a safe haven if/when those dark days happen upon us. With gold and silver down from their 2011 peaks, this offers a good buy opportunity for these coins. Most financial analyst would stress not putting all of your eggs in one basket, as if that one basket collapses, then you lost all of your money. By investing some of your money in precious metals, you are prepared if the dollar fails, pulling with it many of the common stocks.
If considering precious metals such as silver or gold, one of the more important perspectives to understand is the base value of the precious metal as compared to the numismatic value. You can purchase gold and silver bars in many shapes and sizes with the cost being the base value of that previous metal. If you purchase a coin with the same amount of gold or silver, then the value is normally the base value of the precious metal, plus there can be an additional premium based upon the coin. There are many factors that can contribute to ascertaining the premium, with rarity and demand being two of the primary aspects. For example, the Walking Liberty half dollar, Franklin half dollar, and 1964 Kennedy half dollar all have the same about of silver, and the same value in the base price for their silver. But, the numismatic demand and value for the Walking Liberty half dollar is much greater than the Franklin half dollar, which is normally greater than the Kennedy half dollar. If given the option of these three, the best choice in using a financial consideration as your primary guiding incentive, then the best choice is the Walking Liberty half dollar. It is not that difficult to understand which series have greater demand, and a greater possible numismatic premium based upon demand.
Most coins are considered long term investments. A great book that can show many of the alternatives in investing in coins is Profit from Gold and Rare Coins now by Donald H. Kagin, Ph.D. This books not only goes into comparisons between different types of coins and the stock market, and provides an analysis of the many options available in coin collecting, it provides recommendations on the best way to invest your money based upon historical data and the author’s vast experience. You can visualize the upswing of coins as compared to most other investments, especially in the long term.
One of the greatest reasons to collect coins is for the enjoyment. When you invest in stocks, do you enjoy reading and learning about the history of the stocks and what they represent? The images used on coins represent the people, places, events from our countries past. They are symbolic in nature of the beliefs and principles of that era. They display the artistic talent and pride from those who endeavored to envision and create them. The more we understand them, the greater we enjoy and appreciate them. The more experienced we become in examining coins, the greater we can use this knowledge to fine tune skills such as grading and selecting coins that are better quality and have a higher potential to increase in value.
A hobby is also something that can be shared between parent and their children or grandchildren. Coin collecting is ageless, the bonds observed between different generations sharing or passing on their knowledge to others is priceless. It is truly the essence of the hobby. Would you want your child collecting sports cards that are simply cardboard and can be printed endlessly or perhaps something like benie babies that became an expensive fad and ended as quickly as it started. Teaching your children about coins can enlighten them into the many great aspects and enjoyments of learning while doing something fun.
If you are at that stage in your life where you are finished college, beginning your career, starting your family, and becoming independent, it is important to consider ways at this stage to invest your money for the long term, including retirement. Coins not only offer a tremendous opportunity for this, but you can also enjoy collecting as you expand your passion, knowledge, and portfolio into this wonderful world that millions have enjoyed.
Kevin J Flynn
0
Comments
While I didnt stop collecting in college, my coin budget was a fraction of what it is now nearly a decade later.
I agree that coins offer a very unique investment that are long term in nature. I believe that the precious metal coins produced today offer a very large opportunity for younger collectors (those with time on their side; no offense older members!) Some of these mintages are incredibly low with a great base metal as the floor.
BST Transactions (as the seller): Collectall, GRANDAM, epcjimi1, wondercoin, jmski52, wheathoarder, jay1187, jdsueu, grote15, airplanenut, bigole
I became a more avid collector at about 25 years old and still collect today at the age of 35. There are very few people in my age bracket who collect coins. Most collectors are either very young or very old. I think most people who become advanced collectors don't reach that point until the age of 45. Until then, most collectors are casual as they have other responsibilities. Forty five may even be an underestimate. Fifty or fifty five may be a better guess. Coin collecting has always been an old man's hobby for a number of reasons. It requires time and money. It does not require any physical strength or stamina. It is a reminder of the yesteryear before credit cards and online purchases were the norm. With the exception of online research and holographic slabs, the hobby does not require any high-tech tools. It is obviously an old man's hobby when observed on any bourse floor or coin club.
I collect because I have a genuine interest in the hobby and realize that when the day comes that I am ready to sell, I will be faced with a sea of greedy sharks who are all eager to buy low and sell high for an outrageous profit margin. Selling will require patience, strategy, and probably a bit of frustration. I will need to find someone like-minded as myself who appreciate coins for the same reasons as I do, not merely as a way to make an insane profit at my expense. I hope to have access to a local coin club when that day comes and will be happy to break even. I do not view my collection as an investment, as the goal of an investment is not to break even. I do admit I will be disappointed if my collection realizes less than what I spent. I expect a 30 to 40 year holding period for the more prized items of my collection.
kids coming out of college are normally in debt and cannot afford to buy coins.
Collecting coins with the primary objective of an investment will normally either make you or break you, if you loose money, you will probably leave if you loose your money, or if you make money you, and over time, this normally shifts into learning and enjoying your coins.
But on the other side of the coin to speak, our coins do have value, which hopefully over time, if we purchase smartly will increase in value.
Looking at the charts and analysis in Kagin's incredible book, it is obvious that the longer you hold your coins, the better potential your coins will increase in value.
Therefore starting earlier to collect and/or learn about coins, increases your potential for increased return.
I would always prefer to get people involved because of what coins represent and the history behind them. This brings more connection and enjoyment to your collecting endevours.
And of a young adult collected as a kid, there is a higher probability they already would return, when the time was right.
The bigger group I was targeting was those just considering the hobby. I was teaching a class on apprasing your coins at a local community collection to life members +50), a few students for the next class came in early and a few were listening to the conversations, several spoke to me after about collecting, on of which had been given coins by her father and still treasured them. We spoke for 15 minutes talking about collecting. Point being sometimes people have coins, how do we help them to take the next step.
The investment perspective is something I believe everyones starts to consider when entering the real world, we can show them the opportunity, and show them the other benefits also.
It is better than doing nothing.
If you have other ideas, would be glad to hear them.
Good point about the challenge/fustration of selling, one point I always make at club meetings when doing a presentation about the importance of bringing in kids is that if we do not bring in the next generaiton, who is going to buy our coins? Without collectors, no demand and we go the way of stamps into oblivion.
Thanks
Kevin
The time when people graduate college is a big transition and really the start of life in the real world.
There are a lot of new challenges, adventures, interests and disappointments during this period and many years beyond. Those kind of take priority over hobbies. People can also view coin collecting as something they did as a kid and feel they’ve outgrown it now.
I think the normal cycle for coin collecting is start as a kid, experience life and around middle age come back to collecting. In between is marriage, kids, careers and life in general that take up a lot of time after college.
The one most important thing for young adults to understand is SAVE YOUR MONEY FOR THE FUTURE.
Anyone can become a millionaire. Just save $655 a month and get a 5% return and in 40 years you’ll have a million dollars in the bank.
Most won’t be able to save that much in their 20’s but you have to get in the habit of putting money away for your future, even if it is only $25 or $50 a month to start.
Compound interest can be your friend, but you have to start the habit of paying yourself early in life and keep doing it.
I think it is dishonest to cherry pick precious metal numbers from 2008 to 2011. Like that if you then bought silver for $46 in 2011 you would be totally screwed right now if you had to sell. Adding a line like "With gold and silver down from their 2011 peaks, this offers a good buy opportunity" just comes across as a marketing line from a gold huckster firm. It's pretty much presented as all upside, no downside.
I personally agree having some bullion for diversity and for a SHTF situation, but the average young adult would probably be better served by just investing in a few index funds.
I am all ears on other perspectives.
Objective is to get them involved.
Would be glad to include comments from others (under their name of course for that section, or a completely different section)
Will be posting articles like this on other sites.
Kevin
<< <i>I first developed an interest when I was about 9 years old, but was unable to collect due to a lack of transportation. This was before the era of mainstream Internet or Ebay. I started collecting again when I was in my early 20's, but took off to a very slow start. My financial goals were centered around my education and buying my first reliable car.
I became a more avid collector at about 25 years old and still collect today at the age of 35. There are very few people in my age bracket who collect coins. Most collectors are either very young or very old. I think most people who become advanced collectors don't reach that point until the age of 45. Until then, most collectors are casual as they have other responsibilities. Forty five may even be an underestimate. Fifty or fifty five may be a better guess. Coin collecting has always been an old man's hobby for a number of reasons. It requires time and money. It does not require any physical strength or stamina. It is a reminder of the yesteryear before credit cards and online purchases were the norm. With the exception of online research and holographic slabs, the hobby does not require any high-tech tools. It is obviously an old man's hobby when observed on any bourse floor or coin club.
I collect because I have a genuine interest in the hobby and realize that when the day comes that I am ready to sell, I will be faced with a sea of greedy sharks who are all eager to buy low and sell high for an outrageous profit margin. Selling will require patience, strategy, and probably a bit of frustration. I will need to find someone like-minded as myself who appreciate coins for the same reasons as I do, not merely as a way to make an insane profit at my expense. I hope to have access to a local coin club when that day comes and will be happy to break even. I do not view my collection as an investment, as the goal of an investment is not to break even. I do admit I will be disappointed if my collection realizes less than what I spent. I expect a 30 to 40 year holding period for the more prized items of my collection. >>
I would like to add to this being that it hits close to home for me also. I am turning 44 this year and not financially able to collect the way I would truly like to for a consideration not mentioned, children. I have 4 boys and just feeding them every month is a monumental task then add in that 2 of them 16 and 18 are of driving age. Then all the other bills/expenses for them is crazy. I would not give up my children for anything and would not go back and change how many I have as they are such a gift. An expensive gift nonetheless. This does curtail the ability to spend money on collecting coins and other hobbies. The other thing that makes it harder is what income bracket you are in when you start. If you happen to be one of the lucky individuals who is in a high income bracket you can afford better coins to start. When in a lower income 50,000 to 70,000 for a family the coins you buy are more common and many times lesser quality. With this being said the longer you collect, interact and learn in the hobby the more you want the better coins. When you see the better coins being posted all the time on different boards and seeing them for sale and just knowing you can not get them can be depressing. This can lead to a loss of interest until you are as stated an old man when you have more disposable income. Just an opinion based on my experience and some friends.