Beefing Up Your Investment Strategy with Collectibles
Sign up for our FREE Monthly Email Newsletter
In addition to keeping in the financial know, you may be interested in checking your credit score and report.
¹The credit scores provided under the offers described here use the Equifax Credit Score, which is a proprietary credit model developed by Equifax. The Equifax Credit Score and 3-Bureau scores are each based on the Equifax Credit Score model, but calculated using the information in your Equifax, Experian and TransUnion credit files. The Equifax Credit Score is intended for your own educational use. It is also commercially available to third parties along with numerous other credit scores and models in the marketplace. Please keep in mind third parties are likely to use a different score when evaluating your creditworthiness. Also, third parties will take into consideration items other than your credit score or information found in your credit file, such as your income.
²The Automatic Fraud Alert feature is made available to consumers by Equifax Information Services LLC and fulfilled on its behalf by Equifax Consumer Services LLC.
³Equifax Credit Report Control™ is only available while you have a current subscription to Equifax Complete Premier. Locking your credit file with Equifax Credit Report Control will prevent access to your Equifax credit file by certain third parties, such as credit grantors or other companies and agencies. Credit Report Control will not prevent access to your credit file at any other credit reporting agency, and will not prevent access to your Equifax credit file by companies like Equifax Personal Solutions which provide you with access to your credit report or credit score or monitor your credit file; Federal, state and local government agencies; companies reviewing your application for employment; companies that have a current account or relationship with you, and collection agencies acting on behalf of those whom you owe; for fraud detection and prevention purposes; and companies that wish to make pre-approved offers of credit or insurance to you. To opt out of such pre-approved offers, visit www.optoutprescreen.com/.
4We will require you to provide your payment information when you sign up and we will immediately charge your card $4.95. After that, we will charge the card $19.95 for each month you continue your subscription. You may cancel at any time; however, we do not provide partial month refunds.
Equifax® is a registered trademark and Equifax Complete™ Premier is a trademark of Equifax, Inc. © 2014, Equifax Inc., Atlanta, Georgia. All rights reserved.
Throughout history, people all over the globe have invested their money into collectibles, including art, classic cars, antiques, coin collections, fine wine, and jewelry. In today’s unpredictable economic climate, many investors are again considering these as investment strategy options. Is this type of atypical investment…
Throughout history, people all over the globe have invested their money into collectibles, including art, classic cars, antiques, coin collections, fine wine, and jewelry. In today’s unpredictable economic climate, many investors are again considering these as investment strategy options.
Is this type of atypical investment right for you? What are the things you will need to consider before purchasing an art collection or other valuable item as an investment?
Benefits of investing in collectibles
Investing in valuables can be beneficial for some people, especially those who love what they are collecting. If you love art, investing in an art collection may be a great option—and you’ll get a great deal of enjoyment out of it. Also, most collectibles will not lose their value over time. In comparison, when you invest in a stock, you could see it dwindle to nothing in one day if the market crashes.
Cons of investing in collectibles
There are a few things to carefully consider if you do decide to invest in valuables. First, valuables are only going to yield a profit if they are in demand. If you are ready to invest you need to choose wisely. If you are an expert in the investment area, that’s great. If not, seek advice from someone who is.
Getting an appraisal before you buy is recommended. Make sure you are purchasing genuine products that are unique and will be in demand not only today but in the future. Finally, storing and insuring collectibles can be costly, and you will not receive any income on your investment until you sell.
Don’t forget insurance
If you do decide to invest in collectibles, make sure you get the right insurance to cover for loss, theft, and damage. Your homeowners insurance policy will most likely not cover the cost of collectibles—read the fine print very carefully and make sure you understand the terms. For example, if you collect classic cars, your insurance coverage may only allow so many miles driven per year in order to keep your coverage. Review your policy on an annual basis to make sure it is up to date with your current needs.
Consider the tax implications
Before investing in collectibles, make sure you understand the tax implications you could be facing down the road when you sell. You will most likely need to pay a capital gains tax on any profit you make. It is always a good idea to consult with a tax specialist before moving forward.
Is this investment strategy right for you?
Deciding whether or not to invest in collectibles is a personal decision that only you can make. Carefully look at the pros and cons before investing. A well-diversified portfolio requires care and attention. If you do decide to diversify your portfolio with valuables, choose wisely. Carefully research the items you plan to buy to ensure they are authentic and will not lose value over time.
Jeff Rose is a certified financial planner and author of the blogs Good Financial Cents and Soldier of Finance. Learn more about his Roth IRA Movement that has inspired over 140 personal finance to educate young adults on the importance of saving.
Equifax maintains this interactive forum for education and information purposes in order to allow individuals to share their relevant knowledge and opinions with other members and visitors. We encourage you to participate in discussions about personal finance issues and other topics of interest to this community, but please read our commenting guidelines first. Equifax reserves the right to monitor postings to the forum and comments will be published at our discretion. Do you have questions or comments about your Equifax credit report or customer-service issues regarding an Equifax product? If so, please contact Equifax directly. All opinions and information expressed or shared in blog comments are solely those of the person submitting the comments, and don't necessarily represent the views of Equifax or its management.