As things are bad right now, economically, many people are thinking that now is the time to sell their collectibles and use the money for ordinary things, like the mortgage payment or eating. Unfortunately, because things are bad economically, you will find that selling your collectibles is more difficult, and most people are not in the mood to buy, even if they have the money. Many people are trying to get whatever money they can from the things they bought when times were better, so it is definitely a buyers market, meaning you will get less than “book value” for your possessions. Baring gold and silver specie, where prices are up, you are going to have a hard time turning anything into money right now.

There are several reasons for the disappointment the previous paragraph may have, and probably did, inspire. First, when you bought your collectibles, whether stamps, coins or old beer bottles, they had value. You paid for them, therefore they had value, to you and to the person you bought them from. You two may have agreed on a price based on a pricing guide, which gives some indication of the rarity of the item and the prices realized at auction or in the secondary market for the previous year or two. Now you would like to use that same price to sell your possession, but no one is interested. Perhaps no one is interested at even half of what you paid for the item. This is very discouraging, but the current state of the economy has a great deal to do with this.

Perhaps you purchased a whole series of items from the manufacturer, who sold them to you as limited editions that “would increase in value.” Here the rub is in the number of the edition. An edition of 25 will probably be sold out in only a few years, and the secondary market will reflect that in the aftermarket price. But, if the edition is 10,000, the original vendor still has many copies available years after its introduction, and most people will buy new and from the original vendor rather than chance non-mint condition and the possibility of getting a forgery for the less-than-issue price. So, until the original edition is sold, you have no chance of getting your money back from the object, and it may never have a secondary market price over half of the amount your paid originally. There are exceptions to this rule, but very few. However, the marketing of such collectibles always plays up the rare case of instant sell-out and increasing value in the secondary market in order to get you to buy these collectibles.

So, what to do: If you really intend to get your money back on the things you buy, you need to buy gold and silver ingots, etc. Buy with your head. If you buy with your heart, as we do when things are good, than buy because you like the items and without concern for their “value.” Your grand-kids can worry about that when they inherit and try to sell the collectible. Buy what you like and enjoy it. If you develop a relationship with a dealer or two, they may be able to provide leads for disposing your collection when the time comes, but this requires two things: spending time and money with the dealers when things are good, and having lots of time to dispose of your collection. If you need the money today, or this week, you are going to have a hard time getting anything for your items or you will get way less than you paid for them.

Harsh truths, and you wish someone had mentioned them before. Me, too. But the fact is, most people will not realize any increase in value of the things they buy over a lifetime. Period. So, buy what you like, but do not call it an investment, as it is an expense.

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