Investable Collectables?

Key Takeaways

  • Collectable items are different from investable assets; collectables are just items whereas investable assets have an operating purpose.
  • Consider keepingyour hobby collection to under 5% of your investable assets.
  • If you decide to sell your collection, use an appraiser to ensure you know what your collection is worth in today’s market.

Remember Beanie Babies back in the 1990s? They started out in the beginning of that decade as loveable, kids’ toys, then turned in to valuable collector’s items where you could trade them for higher and higher prices and make a lot of money. Then suddenly, they bombed. Within a few years, you could buy three for a dollar at the dollar store.

There are many kinds of collectable items. Some people collect coins, baseball cards, figurines, stamps, and many other items. These are not the same however, as investable assets.

Investable assets have an operating purpose, whereas collectables are just things. An operating purpose would be to make money in a particular area of our marketplace, so there’s actual operating income, pay out of dividends, or interest earned on loans. We can look at those investable assets and say that, at some point in the future, they are going to be worth more than they are today.

There’s certainly nothing wrong with having a passion for collecting things, but think of it as being a hobby.

I know a gentleman who, for the past 25 years, has been collecting a certain kind of item, where he’ll find them for $30 or $40 and they are worth $5,000! He scours the countryside for these items and it’s really a profession for him as he makes a living from the money he makes selling these items. For most of us though, collecting truly is a hobby.

If you have a hobby, how much should you really spend on it?

It’s good to keep spending on your hobby under 5% of your investable assets. If you don’t set a cap on it, and you really love collecting, it can get out of control. You’ve heard those stories of people who have huge warehouses or even museums dedicated to Cabbage Patch Kids, Beanie Babies, figurines, plates, or some other item where they’ve spent their entire life savings on it. Certainly, most of us know not to do that, but capping your expenditure to under 5% on your hobby is a good guideline.

If you decide you want to look at selling your collection, give us a call and we can help you find the right appraisers to look at your collection to ensure you get the most out of selling it.

Until next time, enjoy!


Learn more about TransformingWealth™ , our proprietary approach, designed to get your arms around the big picture so you can make informed financial decisions. Ask Gary about Coyle’s TransformingWealth Preview Meeting, and schedule a complimentary consultation and start living the Good Life Managed Well™.

Gary Klaben is in our Glenview, IL office and serves our clients who are now located all over the country.  He has over 30 years of experience and is the author of Changing the Conversation, The Wealth Sanctuary and co-author of The Business BattlefieldWhether advising his clients, mentoring his team, or coaching entrepreneurs, he is always simplifying complexity and motivating others to take the next action that’s right for them.
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