What Collectibles Survive Inflation the Best? Here's What Experts Say
When inflation hits a family budget, it can be tempting to start looking for easy ways to bring in money. Collectibles tend to be one source families look at for possible income when times are tough, especially if those pieces have shown a history of surviving inflation.
According to Melanie Musson, a finance expert with Quote.com, “Things with a truly limited supply tend to hold their value even during inflationary periods. Understanding what makes these collectibles valuable is essential for investment success.”
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Here’s what to know about which collectibles survive inflation the best.
Trading Cards
Not all trading cards will increase in value, but vintage and rare cards usually do, even when the economy is bad, per Musson.
“There aren’t going to be any more in the supply,” she explained. “In fact, the supply of good cards will increasingly diminish as cards are lost, damaged and worn. Not all trading cards perform equally well. Mass-produced cards are easy to find, so they are not valuable.”
Coins
According to Musson, “Coins not only have a collectible aspect contributing to their value, but they also have intrinsic value because of the precious metal they’re made of.
Musson added that gold and silver are often good investments to hedge against inflationary losses.
“Watch out for collector coins that aren't made of solid precious metals,” she noted. “The collectible aspect alone isn’t often enough. The metal value needs to be part of it.”
High-End Watches
High-end watches are another collector’s item that tends to maintain and grow in value over inflationary periods, Musson said.
“Those who understand which watches are the rarest and most desirable can do well using watches as investments,” she noted. “One of the biggest risks is that if you invest a lot of money in watches without knowing what makes the watch valuable, you could choose an asset that doesn’t increase in value with inflation.”
Art
If you ask Taylor Kovar, certified financial planner (CFP) and co-founder of UseKlear.com, art and rare coins are often the categories that seem to hold up best, mostly because there's a longer track record and a somewhat established market for pricing them.
“A painting or a rare card can sit for months before the right buyer comes along, and that can be tough if you might need that money sooner rather than later,” he added. “Condition and authenticity matter quite a bit too, and without real experience in a category it's easy to pay more than something's actually worth.”
The Bottom Line
Mark Prokoudine, executive chairman and co-founder of Youtooz, said inflation alone isn’t what makes a collectible desirable. He explained that the underlying demand still has to be there regardless of what’s happening in the market.
“I'd look for an established community around the underlying intellectual property, genuine rather than manufactured scarcity, product quality and evidence that people want to own the item independent of its resale price,” he added.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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