If you have a coin collection and are in need of a little (or lot of) money, you’re probably pondering the idea of selling those collectible coins.
Though you may see the promise of cold hard cash in your hands as a reason to sell your coins, sometimes there are tax implications to selling coins, and you might be selling rare coins that may appreciate in value over the long term.
While this post is intended only for informational purposes, and coin values cannot be guaranteed by anyone, we’ll look at the issues of selling coins, and the pros and cons you could face when you sell old coins.
Cons of Selling Coins
Let’s start with the bad stuff (cons) first so we can end on a high note with the positive side (pros) of selling coins!
If you think selling old coins means “free” cash, think again.
In many cases, you have to report to Internal Revenue Service (IRS) the money you earn when you sell coins.
That means for every dollar you make on a coin, you could be liable to report that as income.
It’s best for you to consult your tax advisor on tax laws and how they may specifically apply to you and your old coins.
Don’t forget, if you get caught as having been involved in an unreported coin selling transaction that you had to report, you could get in big trouble!
In the rush to sell old coins to gain quick cash, you may be overlooking sentimental value you may have attached to the coins.
It may seem easy to sell those old albums of coins you inherited from a grandparent or an uncle, but – perhaps – the promise of getting a big fat check from a coin dealer may be clouding your judgment… and you could eventually regret selling those old coins that a loved one that has since passed on bequeathed to you.
Think twice – then think again – before selling any coins that you received as a gift or inheritance from a loved one.
Losing Out on Potential Value Gains
While we will not discuss or speculate on value gains for any particular coins, it’s true that, over the course of many years, rare coins usually tend to appreciate in value.
If you’re considering selling rare old coins, you may want to think twice on selling pieces that could be good investments in the coming months and years. Is now really the time to sell?
Perhaps you should hold out and see if those coins you want to sell may increase even more in value?
Think long and hard about selling old rare coins, and make sure you aren’t making a move you may regret.
Pros of Selling Coins
OK, so we’ve covered the cons that you may confront if you sell your old coins. Now, let’s look at some of the pros of coin selling.
Yep – cold hard cash. That’s why many people sell their old coins. Because they want to – or need to – infuse a little money into their wallets.
Selling coins is usually a quick way to earn a little money. But you need to make sure you’re getting your fair share – or aren’t expecting more than your coins are worth.
Some people have inflated ideas about what their collectible or old coins are worth. Many old coins, such as Morgan or Peace silver dollars, Indian and wheat pennies, Buffalo nickels, and Mercury dimes are common and not worth as much as you may think.
Refer to a coin value guide before selling those coins so that you have a better idea as to what you should get for them.
Reinvesting in Other Areas of the Hobby
Some coin collectors sell old coins not for bill or grocery money, but for more coins.
In fact, for many coin collectors, selling coins may be the only way they can afford to venture into new areas of the hobby.
Perhaps they’ll spend a period of time filling one coin album only to sell those old coins so that they can afford to start a whole new coin collecting project.
Potential Losses if You Wait to Sell
Some coins go down in value.
In fact, it’s not at all uncommon for some coins, especially bullion coins or common gold or silver collectible coins, and even many modern commemorative coins, to fluctuate in value when coin collecting trends or market patterns change.
Many bullion coins ride the wave of the global markets, and investing-privy coin collectors may watch for or predict these fluctuations and sell right before they think the prevailing economic trends will temporarily pull down the value of their silver or gold coins.
As you can see, there’s no real clear cut way to determine if selling your old coins may be the right thing for you. You need to consider many of the factors mentioned above – and determine if there are any others that uniquely affect you – before making a decision to either keep or sell your old coins.