Saturday, March 2, 2013

A Different Kind of Gift - How to Buy a Collectible Coin as a Present

We use coins every day to buy coffee, pay tips and make change at the grocery store.  Coins are so common that many of us don’t realize their potential value as gifts.

Many old coin specimens are excellent presents.  The shine of a well-preserved 19th century silver dollar can be appreciated by all sorts of people.  Depending upon its type, age and condition, a coin can carry bullion value, antique value (also called “numismatic value”), historical value, artistic or aesthetic value, and even sentimental value.  The right kind of coin, for the right person, can make for a very personal gift.

Before buying a coin as a present, however, there are a few basic principles of the coin trade that you should first understand.

How to buy a coin as a gift
If you’re considering making a gift of a collectible coin, you probably know the person receiving the gift very well.  Think about what sort of coin he might like to have.  If he’s interested in history, ask him about some of his favorite periods and places and try to find a coin minted in one of those places or times.  Some types of coins are very difficult to find at a reasonable price, whether for reasons of age or low mintage numbers.  Others are surprisingly common: if the man in question is interested in Roman history, for example, you should easily be able to find a nice Roman denarius (a small silver coin featuring the portrait of the emperor of the date of the coin’s mintage) for around forty or fifty US dollars.  If he is interested in genealogy, you might instead consider buying a coin from one of the countries his ancestors came from.

Where to buy coins
Collectible coins are sold primarily in four places: coin shows, coin trading stores, flea markets and online auction sites (or, in other words, eBay.)  The first two are generally the best places to buy coins.  When buying, it’s always advisable to deal with coin experts who understand the values of individual pieces and can independently grade coins and weed out counterfeits.  Coin stores and dealers have reputations to protect, so unless you happen to stumble across the rare crooked dealer, you generally won’t be ripped off.

Be wary of flea market sellers and eBay auctions.  Many of the coins sold in these venues are counterfeits.  To be safe, find a coin dealer with a good reputation and buy from him or her instead.

The difference between slabbed and raw coins
A slabbed coin is one that has been verified by a coin grading service as genuine.  Some of the most trusted coin grading services in the United States include PCGS, NGC and ANACS.  These services authenticate old coins and give them “grades” based upon their conditions and the amount of detail still visible on the coin’s surfaces.  These grades consist of letters and numbers together (for example, G-4 and MS-60) and are practically undecipherable to the coin novice.  Just keep in mind that a higher number means the coin is in better condition (MS-70 indicates a perfectly preserved mint condition coin.)  Slabbed coins are so labeled because they are inserted into large clear plastic cases, or slabs, after being graded.

Any coins that aren’t contained in slabs are considered raw.  There’s nothing wrong with buying a raw coin as long as you know it’s genuine – many raw coins are bought and sold by professional coin dealers, who have the ability to sniff out fakes.  Another advantage of buying a raw coin is that you can actually hold it in your hand, which you can’t do with a slabbed coin.

An old, nicely preserved coin can make for an unusual, unexpected, thoughtful and personal gift.  If you want to give a close friend or relative something different this holiday season, consider an antique coin.

Jack Harding has been an avid coin collector since he was a child, when his grandfather introduced him to the hobby. Click here for more interesting and unusual gift ideas.

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