People collect coins for several reasons. Coins can be collected as works of art, or to make money. If collecting as a hobby or for a profit, caution is warranted. The best reason to be a numismatist, or coin collector, is because it’s an enjoyable hobby.
Coins are made in different denominations. These are the penny, nickel, dime, quarter, half and dollar. They are stamped with the year they were made and mint location. The current minting sites are Philadelphia, Denver and San Francisco. The West Point mint makes commemorative coins. Some mints don’t produce coins every year, and production varies.
Each coin has a heads and tails. Coin collectors call the heads obverse. It often has the head of an individual. The tails side is called the reverse, and an image associated with the individual or United States symbol, such as an eagle.
Ways To Collect Coins
There are many ways to collect coins. A collector can devise their own collecting methods.
Series: This would be one for each year a coin was minted. This would include one for each from each mint. Jefferson nickels have been minted since 1938. A complete series of Jefferson nickels is from 1938 to present. A series set includes design changes.
Type: This is one of each type of coin. A nickel has 4 types; the shield, liberty, buffalo and Jefferson. A type set would be one of each type. Each type had design changes from time to time. These changes could be included for a complete set.
Date Sets: This collection could be for any year. It could be a birth, or anniversary year. It would be one of each denomination for that year. It could include coins from different mints, or one.
Proof and Uncirculated Sets: A proof set is one of each coin foCredit: Public Domainr a year. Proofs are specially minted and processed for quality and luster. An Uncirculated set is one of each coin for a year. They aren’t issued for general circulation. These coins are minted with special dies.
There are specialized coins to collect. The United States mints commemorative and gold and silver bullion coins. It offers literature and brochures that show their current offerings.
American Numismatic Association
The American Numismatic Association (ANA) is the national organization for coin collectors. It sets coin collecting standards, governs practices and ethics for coin dealers, clubs and individual members.
Coin condition and rarity determine the value of a coin. Condition is the most important thing to know about coin collecting. The ANA has developed an alphanumeric system to designate the condition of a coin. It ranges from mint state perfect to worn to where the date is barely visible. The book, American Numismatic Association for Grading United States Coins is the ANA standard. Photograde: A Photographic Grading Guide is also accepted. The information is the same in both, but the presentation is different. The ANA book uses drawings of coins. Photograde uses photos. The importance of a collector knowing grading practices cannot be overstated. Value between grades is significant. The difference between two grades can determine profit or loss.
The ANA offers a grading service. It is the Numismatic Grading Corporation, (NGC). For a fee the NGC determines the coin authentication, grade, and encapsulates it in a plastic case with the grade on the case. Professional Coin Grading Service, (PCGS) and Independent Coin Graders, (ICG) are also ANA approved certification services.
Gold and silver is a commodity. Coins made from these metals will fluctuate with the commodity market. Collector coin prices vary by these fluctuations in addition to condition and rarity. Coins bought when gold or silver is high, will drop when the market price drops.
Coin Collecting Hazards
If a coin is rare enough, it will be counterfeited. Even the grading service plastic cases and labels are faked. This allows a seller to pass off a lower grade coin at a higher price. If the coin is premium, the difference is a great deal of money.
The best way to buy coins is from a dealer or individual that is an ANA member. They should have a return policy that covers condition and rarity. The dealer should be willing to submit the coin to an independent evaluation. A buyer should feel comfortable with their coin dealer.