Pros and Cons of Collecting Coins

Coin collecting, also called numismatics, has been around for centuries and was once practiced by kings and wealthy families. According to the US Mint, the earliest recorded coin collection was conducted by Augustus Caesar, the first Roman emperor who lived between 63BC and AD14. In the Renaissance period (around the 12th century), coin collecting has also been popular among scholars because of their fascination with the hobby’s artistic, cultural, and historical elements.

The historical background of coin collecting led to a common misconception that this hobby is only for the rich and the intelligent ones. However, with the advent of online platforms, finding and purchasing rare coins has become more accessible to anyone. With the right website, it only takes a few clicks to be able to indulge in this activity.

At present, there are millions of people from all over the world who collect coins because they enjoy tracking down rare old coins or commemorative special editions that they can add to their existing collections (check out the 8 prized U.S. coins in circulation). The recent Mhojhos Research report found that there are around 615 million coin collectors in the world, of which 140 million come from the U.S. alone.

People of all ages and different walks of life find coin collecting a rewarding hobby. In addition to being a hobby, other people collect coins as an investment due to coins’ potential long-term profit.

No matter what your motivation is, diving into coin collecting requires proper knowledge as it may lead to frustrations or severe losses. This article will present you with the pros and cons of collecting coins to be able to make sure that this hobby is really for you.


The pros

  • Personal pleasure

Whenever you find a rare coin that you’ve hunted for a long time, it always brings a feeling of satisfaction. The history, culture, society, and politics that come along with their discovery may also be educational and exciting for some. In addition to coins’ rarity and historical significance, their beautiful designs and details are also pleasurable to look at.

  • Metal content

It is the metal content of old coins which attracts some collectors. Ancient coins contain  50-90% silver or gold, making coin collecting a rewarding work despite the challenge. Unfortunately, nowadays, most minted coins have only small traces of these valuable metals.

  • Affordability

Although some rare old coins may cost millions of dollars, building an impressive collection can be surprisingly affordable. If you achieve to set aside a few dollars a day, a collection of coins with historical significance, beauty, and lasting value can be built. An article by Thomas Coulson on Collecting Coins on a Budget suggests that devoting a cost of a small cup of coffee or soda a day can build a $1,000 collection in three years and $2,000.00 in five years.

Some collections you can assemble by saving a dollar a day include:

  • Walking Liberty Half Dollar Short Set (1941-1947), which may be completed in 4 to 5 years, is available from Professional Coin Grading Service or Numismatic Guaranty Company in MS63 to MS64 Grades.
  • Braided Hair Half Cent (1849-1857), which may be collected in 4 years, is a group of eight coins that offer excellent value, historic interest, and pursuit challenge due to its scarcity.
  • U.S. Silver Eagles (1986-Date), which may be completed in 4 years, offer beauty and value. Their design was patterned after Adolph Weinman’s Walking Liberty Half Dollar which was considered one of the most beautiful coins struck by the US Mint.
  • Increasing in value

Over time, the value of coins typically increases, making coins a perfect long-term investment. Factors that determine the potential increase in the value of a coin are its historical value, high-quality conditions, and rarity. For example, the most expensive coin sold at an auction last year was a 1787 Brasher Doublon at Mint State for $4,582,500.

  • Plenty of storage options

Whether your concern for storage is safety, appearance, or cost, there are plenty of storage options for every collector. What you have to primarily consider is the possible effects of exposure of your coins to the air, moisture, and other hazards like fingerprints or contact with other coins that can alter their appearance through time.

If you’re collecting raw coins, many folders and albums are available for most series that serve as protection for your set. Most holders of single coins have windows of the same size as the coin. The windows are covered by a thin layer of polyester film and stapled shut.  If you prefer something with the tightest seal, consider hard-plastic holders. Lastly, a more flexible option called flips is available and commonly comes in two pouches.


The Cons

  • Easily lost or stolen

Since they are physical assets, coins can be lost or stolen if you are not careful. For this reason, it is then practical to secure your coins in a safe deposit box at a bank in addition to putting them in holders and albums.

  • Market fluctuations

The coin value may change depending on the current prices of coin metal contents like gold, silver, and platinum. To minimize this risk and maximize your returns, diversification of the collection is the key just like with any investment. Your portfolio should include a combination of half cents, large cents, dimes, quarters, half dollars, and silver dollars.

  • Time-intensive work

Getting the right coin as an addition to your collection requires a lot of time due to researching and tracking down needed. Aside from that, going to coin auctions or trade fairs may also take time.

  • Long-term appreciation

It takes time for coins’ value to go up. It is not for the “get rich quick” type of investor unless you are lucky to find an extremely rare coin worth millions of dollars.

Your current collection may still be of high value in years to come, but it may also have little chance of appreciating due to inflations, currency changes, and face value.

  • No residual income

Unlike bonds or stocks, you won’t earn interest or dividends with coins.