Collectibles

We got a call a couple of months ago about a person who had passed away and left a large amount of collectibles as personal property in their estate. As collectors ourselves we recognize that although people collect different things we all face similar problems in storing our collectibles during our life and disposing of them after our death. And although we collect for the fun of it, we all secretly hope our collection will become a valuable asset in our estate.

The thing about any collection is that its value is determined by the value of each individual item in the collection. Two things determine the value of each item: condition and scarcity. The better condition an item is in, the more valuable it is. The scarcer an item is, the more valuable it is. The Barbie doll in its original box will be worth more than the Barbie doll that was played with because it is in better condition. An issue of Action Comics #1 published in 1938 (the first appearance of Superman) is worth more than the issue of Action Comics published this month because it is much more scarce. 

Given those facts, collectors need to realize that their collections (with some exceptions) will be most valuable at the time of the collector’s death. And their death raises a separate set of issues including who will inherit the collection, how will it be valued, and how will it be disposed of by the collector’s heirs. If the collector is lucky they will have a family member who is a fellow collector who appreciates the collection and will continue to keep it and let it grow in value. More likely, the collector will leave the collection to a family member or several family members and hope for the best.

Whoever receives an item from the collection or the collection itself will have to decide what to do with it. The first step is usually to figure out how much it is worth. There is probably a published guide to help value almost any collectible. The issue is usually not the price of the items, but their condition. Condition is evaluated based on several factors and grouped into what are known as grades and a value is assigned based on the grade. The most valuable grades are Mint and Near Mint. But the evaluation and the factors used to decide the grade is subjective. It is not unusual for different experts to give widely different grades to the same item. Reaching an agreed value between family members and between buyers and sellers can be expensive and time-consuming.

The last step is disposing of the collection. If only one person inherits the collection and wants to keep it as it is, nothing needs to be done and the collection will continue to grow in value. If more than one person inherits, the collection will most likely have to be broken up and may lose some of its value. If a person who inherits all or part of the collection has no interest in it, they will most likely want to sell it. There are a couple of ways to sell collections. The first is to find another collector or a dealer who specializes in the items in the collection (toys, books, coins) and sell it to them. The second is to find an Estate Sales firm that specializes in collectibles and have them value the items in the collection and conduct a sale.

Finally, a collector needs to remember that a collection is rarely the investment the collector thinks it is. So they should manage their collection for fun and manage their expectations on the value of their collection as part of their estate or their legacy.