Should I consider coin collecting as part of my retirement strategy?

In my opinion, collectible coins and bullion coins (Silver and Gold) can have a place in your retirement strategy, if you want physical wealth that has to be managed.  The collectible value is frequently much more than just collecting bullion (bulk precious metal).

For example, I like US Morgan Dollars, each one is one ounce of silver, which is   US Currency and (at a minimum) worth the value of the base metal, silver. If you have highly graded coins, they will be worth much more then the value of the the silver. and It can be fun collecting an entire set (years and mintages) of Morgans, or just a few for your modest collection.

Morgan dollars grade example

Morgan Dollar grading guide

 

This Morgan dollar was graded MS (“Mint State”) 69 by NGC, a grading organization. Higher grades command higher values. Morgan Dollar (1878-1921) Value – PCGS Price Guide  , Comprehensive Grading Guide for U.S. Coins (from Amazon)

Another personal favorite of mine to collect are Silver Strike casino coins, which are a $10 casino chips with a silver center (about .6 ounce of silver). Collecting casino memorabilia is fun to me, since I have been to many of the casinos and enjoy displaying the strikes I have won/collected.

Silver Strike Token

 

$10 face value Silver city Casino strike (Casino closed 1999)

Most casinos are not using Silver Strike slot machines, as they are mechanical machines, making them harder to find. I frequently buy them on ebay and Amazon. You can also visit the Silver Strikers Club, which has the latest news on Silver Strikes.

Some coins have no silver or gold (or any precious metal) in them; They may only have collectible value.  Some may have no value at all,  making them good for jewelry or as a memento of your visit to a foreign country.  If you have some bona fide collectibles, WONDERFUL!  If not, well, hold on to them if you enjoy owning them.  Your kids may find pleasure in owning Great grandad’s coins from his trip to Havana.

Another favorite of mine is the Silver Eagle (and Gold Eagle) US Coins. Each are 1 ounce of the base metal and are beautifully minted coins! Here again, I frequently buy them on ebay and Amazon. You may also find them at swap meets, flea markets, and yard sales. Coin dealers usually have many in stock, although they buy at wholesale and sell to you at retail. Learn values and grades, and soon you will become a shrewd buyer!

2016 silver and Gold Eagle coins, available online from  eBay and Amazon.

If you enjoy collecting coins, You will need a safe place to  keep them. Some people keep them in a safe deposit box at their bank, others in a  gun safe, if they have one. Thieves don’t like to run around with hundreds of pounds of metal coins – unless you have rare or extremely valuable coins, crooks may pass them by (or just take the shiny ones).

As a hedge on retirement, coins can be readily converted into cash.  You can easily sell most coins to a dealer or on Ebay. Pawn shops will give you a better value on gold coins (usually smelt or base metal value) than on most jewelry. This means you can use your coins like a retirement plan, cashing them out over your anticipated retirement, or saving them as a reserve fund for unexpected bills.

How To Buy And Sell Gold & Silver PRIVATELY: Must Know Strategies To Keep Your Portfolio Private, Stay In The IRS’s Good Graces, Know Your Tax Requirements, … File The Right Reports, Buy The Right Metal

You can give your coins to your heirs while you are still alive, sharing in your enjoyment and teaching the next generation about coin collecting.  Why wait until the end?  You can even get your children (and Grandchildren) coin collecting sets, and get them in the habit of looking at their pocket change, and putting old and potentially valuable coins in “flips”. I bought my grandson this collecting set on Amazon.

Coin collecting set

To recap:

  • Coins can be part of your retirement strategy. (if you don’t like coins, consider a collectible that you will like).
  • Consider the value of the coin, Base metal and collectible value.
  • You will need to track your purchases and store your coins securely.  Anticipate taxes.
  • Coins can be readily exchanged for cash from multiple sources.
  • You can pass them to your heirs without being deceased (or paying taxes, up to $14,000 in the US). (talk to your accountant).
  • Most important – you can enjoy them while you are alive!

I can’t tell you what to do, but I can tell you what I do – a small portion of my retirement is in coins that I enjoy. some are listed above (Morgans, strikes, Silver Eagles, etc.) and some are pocket change and circulated coins that have a value – above face value – with the possibility of appreciation over time. I have a modest budget for my eclectic coin collection.

If you are seriously thinking about coin collecting as a retirement option, Talk to your financial advisor, attorney, and accountant – and guys like me – to determine if  adding coins to your personal financial assets makes sense. Or you can just start collecting pocket change and the occasional coins you like. That is an easy way to start.

Consider all your options, and enjoy your retirement!

The Last Word:

Niue has a cottage business in funky collectible coins.

Niue coins also available on eBay – note the Star Wars coins! (link opens in new window)

niue coins star warsThese are legal tender on Nuie.

Nuie entry in wikipedia

I hope you found my point of view enlightening and informative.  Please share it with your retiring friends.  What’s in your Pocket?

What is the proper way to clean coins?

By Alan Chenkin, Novice coin collector.
The general rule of thumb is to never clean coins. Ever.
This is particularly important with valuable coins, because a speculator might clean the coin to improve it’s worth – but most cleaning actually is visible to coin graders, and such attempts actually reduce the coins value. But there are times to clean a coin, and consider the best way to handle them – look at this from the internet:
How to Clean Coins – Wikihow
If you are considering selling the coins, definitely do not clean them; store them separately and bring them to a dealer for appraisal. If your coins have sentimental value, souvenirs of a trip, or a gift from a friend, preserve them in a holder or frame, and clean them if necessary – the sentiment is worth far more than the coin.
There is nothing wrong with wiping your coins with an athletic sock or polishing cloth, as these do minimal invasive damage to the coin. You may also want to polish a coin that is deteriorating due to corrosion or oxidation – consider it’s value before attempting this, cleaning can actually diminish the collectible value of the coin if done harshly or with strong chemicals.
After you polish your coins, reduce any further damage by keeping them in plastic holders or traditional coin flips.
A fun thing to do with some coins is to use them as jewelry. In that case, having a clean finish will be necessary, and the finished piece may be worth more than the coin itself.
Here is how you can put an amazing shine on a coin:

He uses Mothers Metal Polish and a Dremel tool with a buffing wheel. (Links to Amazon)

If you are unsure as to clean your coins or not, bring them to a coin dealer and ask! Most are helpful professionals, and have a wealth of knowledge. You can also get an idea from these sites on coin grading, especially when dealing with a coin you suspect has value:
How To Grade Coins Using the Coin Grading Scale – Coin collecting guide for beginners
The Westin St. Francis Hotel washes it’s coins, and has an employee dedicated to the task! “Rob Holsen is the coin washer at the Westin St. Francis Hotel, and perhaps the only coin washer on Earth. He said the hotel on Union Square started washing its coins in 1934 when the general manager noticed a woman’s white gloves getting dirty.” From NBC news
Remember to have fun with your collection! Clean or not, sort your pocket change, and see where your coins have traveled from in the world!
Of course, if you don’t want to mess with those nasty, dirty, coins, just send them to me and I will “take care of them for you”.  Honest.
Thanks for reading my Blog! – Feel free to share!

 

Edited from my Answer on Quora.