Collectors: Good Record Keeping Can Save You Money
Virtually every day in my stores, we assist heirs of estates who have little to no knowledge about the coins, paper money and other collectibles that they inherit. In such circumstances, it could be easy for unscrupulous people to take advantage of the heirs. I’ve heard an untold number of horror stories about relatives, friends, neighbors and dealers who persuaded the heirs to part with particularly valuable pieces of a collection for a fraction of its current value.
The best way to avoid such sorry stories is to keep good records of your collection. No matter the kind of collection, the best way to track its contents is to keep a document, which can be handwritten or in a computer file, identifying each specifically valuable item. Among the information that should be kept for these individual pieces are a thorough description of the item plus its condition, size, date of purchase, who it was purchased from, cost and even photographs of the individual items. When you decide what bits of information to record, consider what would be useful to the trustee or personal representative who someday might have to decipher this data. Last of all, the records should indicate the date of the last update.
If you own a series of related items, you might want to record the data in chronological or catalog number order. If your collection is not so easy to organize, you might want to assign item numbers in the chronological order in which you acquired the pieces.
It would be a good idea to keep your master inventory list with your collection. That is the first place where someone else might stumble across it. But, for even better safety, keep another copy of each major inventory update away from the premises where the collection is stored (including duplicate photographs of any major pieces). That way, if the collection is stolen or destroyed in a fire or other natural disaster, there is documentation of the existence and value of the holdings.
Yes, I know record keeping is tedious and much less exciting than the search for just the right piece to add to a collection, but the benefits down the road can easily be worth much more than the time invested.
We had a Middle Atlantic states customer who had multiple collections, worth a combined five to six figures. He was a widower. After he died, the bank trustee handling his estate informed us that he had no heirs, so his collections were being liquidated to provide donations to charities. This customer had kept immaculate records of exactly what he owned in each collection. He also went so far as to leave notes identifying, for each item, which person or company would likely be a strong buyer of it and a rough idea of the price or the formula at which the item could be sold. The trustee read me some of the comments he left as to which coin dealers he had dealt with that he held in highest regard and those he recommended against contacting. The trustee was pleased that the prices we paid to buy the coins were right in line with what the customer had listed.
OK, this was the best job I have ever seen of someone preparing his or her collection to be handled after death. You can still do an acceptable job even if you don’t go to this extreme. If a collector has a spouse or other relative the collector can trust, the person should be taken on a periodic tour of the collection. This person needs to know where the collection is stored, which pieces are particularly valuable, how to safely handle and store the items, where to locate any inventory and other records, and any guidance on where to go to appraise or sell the items.
Another thought for senior-aged collectors is to consider liquidating the collection themselves while still alive. If it will be shared among heirs, consider giving it to them early so that you can share information on what makes the collection so special. If your collection ends up being sold, you may know or can probably find stronger buyers than any heirs or trustees ever could.
If you take the time to assemble a quality collection, it is definitely worth the added time and effort to keep a proper inventory of it.
| || |
Patrick A. Heller is Michigan’s largest coin dealer, owning Liberty Coin Service and Premier Coins & Collectibles in Lansing, Michigan. He writes a monthly newsletter, Liberty’s Outlook, available at www.libertycoinservice.com, and weekly commentaries on precious metals that are posted at numismaster.com and coinupdate.com. His radio show “Things You ‘Know’ That Just Aren’t So, And Important News You Need To Know” can be heard at 8:45 a.m. Wednesday mornings on 1320-AM WILS in Lansing (which streams live and is archived at www.1320wils.com).