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Coin Collecting

Learn more about the popular hobby of coin collecting.

Magnifiers and reference books are often necessary when coin collecting. [©Jupiter Images, 2009]
©Jupiter Images, 2009
Magnifiers and reference books are often necessary when coin collecting.

Coin collecting is a popular hobby that falls within the field of numismatics, the collecting of coins, tokens, paper money and medals. However, Telesphere Numismatics cites coin collecting as the most common type. My Coin Collecting explains that coin collecting is a science -- as coins reflect the political, economic, artistic and societal trends of a time.

Coins have long been an important part of American history. The Founding Fathers of the U.S. government stressed the importance of establishing a national mint to produce coins. Today, four mints operate in the United States. The first coins created under the American Constitution were the 1792 half dismes (half dimes). While many coin collectors collect only American coins, some also collect foreign coins.

How to Build a Coin Collection

Beginning coin collectors should research the hobby and the market before purchasing coins so that they can make good investments. Those who don't research may fall prey to counterfeit or overvalued coins.

Learning the terminology of coin collecting is important. For example, coin collectors must know a coin's "grade" -- its condition rating -- before trying to assess its value. CoinWorld.com publishes a detailed glossary for new collectors who are still learning coin terminology.

Learning the different types of coins is also important. From the 1793 Liberty Cap half-cent to the Flying Eagle, beginning coin collectors need to be able to identify coins. Telesphere Numismatics explains that most coin collectors specialize in a category, such as ancient coins, or the coins of a specific country. Some coin collectors attempt to compile a series of coins by collecting a type of coin from each minted date.

Beginning coin collectors can find coins through coin dealers, the Internet, auctions, flea markets, coin shows and mail order companies. Coins should only be touched on the edge, as the presence of fingerprints can reduce their value. Coins should be placed in holders. Collected coins should not be cleaned. They should be stored in a place with consistent, moderate temperature, and low humidity.

Magnifiers and reference books are often necessary when coin collecting. Joining a numismatics club is also a good idea.

Coin Values

Coin values are influenced by the following factors:

  • Scarcity. The rarer the coin, the higher its value. My Coin Collecting notes that scarcity is not necessarily determined by age. If an older coin is not scarce, it won't be worth much. A rare coin often means fewer than 75 are in existence. Some rare coins command $1 million.
  • Condition or grade. An uncirculated coin is likely to accrue more value. Determining the grade is very important in establishing value.
  • Gold and silver. The type of metal used in a coin can influence its value.
  • Demand. Collector interest -- the demand for the coin --can increase value. For example, according to My Coin Collecting, 1916-D dimes have a higher value than 1798 dimes. Although the 1798 dime is older and scarcer, more people collect early 20th-century Mercury dimes, thus increasing their value.
  • Errors. Some error coins -- coins with a rare mistake on them -- can be worth a great deal of money. CoinWorld.com reported that one error coin recently sold for $3,000.

Other factors that determine a coin's value are its denomination, the year it was minted and the facility at which it was minted. Mintmarks on the coin are also used to help determine its value.

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