I have to admit that I’m a bit of a collector, and I’ve been gathering collectibles since I was a kid. I’ve also been looking around for ways to make some extra money and wondered: could my collections make me a profit?
As the saying goes, sometimes you have to spend money to make money, and that’s certainly true when you collect items. It is an activity that almost everyone has participated in at some time or another in their lives. I have done it and I’m betting that you have as well. It says something about you and your personality when you are a “collector” as your collection usually involves something that’s close to your heart and that you really enjoy.
Hobby or Business?
For tax purposes, the IRS defines a hobby as something you do that doesn’t make any money 3 out of every 5 years. As a hobby, collecting things is thought of as a positive activity. It can be a learning tool for history and or the arts. It’s an activity that can occupy your free time when you’re alone or you can be a part of a social group for collectors that share the experience. Of course if you make money at collection, at least every 2 of every 5 years, you are in a business.
My Start as a Collector
As a kid, I was into all kinds of collecting. I did it as far back as I can remember with things like baseball cards, coins, and stamps. Millions of people have done that type of thing and still do today. It was something that I did for fun and shared with my friends. Making money on it may have crossed my mind, but it wasn’t the attraction for me. And that was a good thing since I never made any. Looking back on that now, I have wondered what those collections might have been worth in dollars and cents today.
Of course, how many of us can actually say we have held on to those things we collected as children for any period long enough to make them really valuable? Anything I collected at the age of 10 would be over 50 years older today. 50 years is a long time for sure, but does that make something valuable in its own right? If being old was insurance that something was worth a lot of money, I’d be very valuable myself!
When I was about 8, I began to collect baseball cards because as you may know by now, I’m a huge baseball fan. Buying a package with that awful gum inside was about 5 cents back in the 1950’s for the gum and about a dozen cards. Everyone I knew did just like I did and rushed down to the candy store whenever they had an extra nickel to make a purchase. If you were lucky, you might get a “checklist” in the package and you could organize the cards to try and get them all for the current season. Getting all of the cards, maybe 200-300 was a real badge of honor. When you did, you felt like you had something of real value. It may have been only an investment of “nickels” but it seemed like so much more than that.
Beyond a Collection
Baseball cards were used in lots of social activities. Things like trading them for the ones you needed with some other kid. The duplicates you had were the ones that your friends might want and duplicates were aplenty let me tell you! Almost in every pack of cards you bought, you could count on several Chico Fernandez’s or Al Spangler’s…you can look them up, they were really players back in those days!
I can remember using the cards in a game we called “flipping”, where you would literally flip the cards against a step and try and get them to land closer to the wall to win your opponent’s cards. If you got one that leaned against the step wall with your skill, that meant your friend would have to keep flipping his cards until he was able to knock it down and beat it or you win a whole bunch of his cards. To keep it from being a disaster, we’d set a limit on the “knock it down and beat it” attempts of 5 or 10 tries. We had a bit of mercy on the poor losers back then.
When a card was no longer of interest or value for collecting, i.e. your card wasn’t a star player or it was a triplicate for example, its fate was clear. It would be attached to your bike wheel with a clothespin so it could be used to create a “motoriffic” sound rubbing against the wheels as you rode around the neighborhood. It lasted maybe a few hours before it was shredded, but we had a great supply of those little devils of which we could draw upon.
Getting Down to Business
As a business, my card collecting never got off the ground. When I was in my 20’s and 30’s I began to collect memorabilia that I loved about the game of baseball. I collected autographed photos of some of my favorite players and icons of the game. Players like Hank Aaron and Tom Seaver. I got autographs from future Hall of Famers on the Braves, my favorite team, whenever I went to the ball games in Philadelphia or New York. I still have balls autographed in the 1980’s by Phil Niekro, Tom Glavine, and John Smoltz, now Hall-of-Famers.
While I did make some money on autographs, it wasn’t on my collection, but on setting up autographing events as I talked about in a previous post.
If you happen to be wealthy, you may be an art collector. Original art by a famous or trendy artist has untold value. Besides the fact that you can actually hang it on a wall or pose it on a table or shelf to enjoy it, one-of-a-kind art pieces can grow in its value. If you are lucky enough to get in “low”, then you could turn a magnificent profit at some point, especially after the artist’s demise. So the simple answer is, yes, you can make money on art.
I also collected U.S. postage stamps when I was young. I had a really huge book of stamps that I mostly bought from a mail-order company in Boston. At one point, I must have had 1,000 mint stamps in my collection. When I was a little older, in my 20’s, I bought several mint commemorative sets of stamps that I thought would be something I could give to my kids as a valuable gift one day. That didn’t happen. The stamps have never really become valuable. For example, the 1976 U.S. commemorative set which I still have in “mint condition” with cover and all the trimmings was purchased back then for $3. Today’s eBay price is about $6 a set. Although they have doubled in value, unless I had purchase about 1,000 sets, it’s really not much to get excited about after 40+ years!
When it comes to stamps, here’s an interesting thought. If you had purchased and saved a bunch of “Forever Stamps” when they first were available just 10 years ago in 2007 for $0.41 cents, the stamps today would have increased in value about 20% to $0.49 cents each. That wouldn’t have involved collecting anything, just inflation made them more valuable. Does anyone regularly mail anything today anyway?
What People Collect
The list of items that people actually collect is mind boggling to say the least. Here’s a brief list of the 20 “top” items that people actually collect today that they hope will grow into a profit at some point in their lives. As an alternative to investing in stocks and bonds, or simply safely putting their money into an insured bank account, many “collect” for future money value and the fun and prestige in things like:
- Baseball cards and memorabilia
- Postage stamps
- Comic books
- Original autographs
- Original artwork
- Rare limited reproduction artwork
- Posters by genre
- Vinyl records and album covers
- Old toys
- Beer cans or bottles
- Bottle caps
- Magazines and newspapers
- Old books
- Vintage clothing
Requirements for a Collection
There are actually hundreds more of different kinds of items that people can and do collect. Some collectors, like the oft-mentioned Jay Leno, have to have a big home and property for his collection of antique autos. Incidentally, those autos have bigger and better accommodations than I have for my wife and me.
And that’s a major rub. You are more likely than not to need a space to store your investment collectibles. If you are into comic books, for example, where do you keep the 25,000 or more copies you may have? They’re more likely than not in boxes somewhere, perhaps in a storage facility at some real dollar expense or at best in your basement or garage collecting dust. Are they collecting dust? Do you go through them regularly and look at them or are they just some kind of reassuring insurance policy for you and your investment?
Don’t get me wrong, it’s not something to be ashamed of if you’re a collector. It’s just this: don’t be fooled in thinking that you will make a killing in some kind of collecting activities just because someone else has done that. The “art” of collection is dependent on the time, place, and climate, and you can never really tell what the next best great thing might be. It might even include an awful piece of gum!
Are you a collector? What do you collect and why? Have you made any money being a collector? Is making money why you collect it?