There are a lot of ways to lose money collecting coins, with a premium here and a fee there; but in my experience, you can lose money 9 times out of 10 by paying ridiculous premiums for unopened mint and proof sets from the 1950s and 60s. But, as usual, there is no other way to persuade some of my zealous readers than to go through a fact-based exercise and, I predict, lose my own money proving the point.
So here’s what we are going to do in this column. In a recent Weaver Signature Coin Auction on Proxibid, I won these unopened mint sets:
I bid $85, or $99.45 with 17% buyer’s fee, for unopened 1960 and 1961 mint sets. I could purchase both of them for about $30-35 each online, so the premium here is about $30.
I bid $80, or $93.60 with buyer’s fee, for these unopened 1962 and 64 mint sets:
These sell for about $25 each, so the premium here is about $40.
After opening the sets, I was, predictably, disappointed. Here’s how the 1964 set looked, jostled around for several decades:
The photo above doesn’t capture the flaws in most of these average coins, but if you look closely at the half dollar at the bottom of the picture, you can see the milk spots. The worth of this set is in the silver. Big loss.
The 1962 set yielded similar average-coin results with the metal content having any value. With silver at about $15 per ounce, I just threw $40-45 down the drain.
Same result with the 1960 set. Another big loss.
However, there was one coin in the 1961 set that caught my eye, this half dollar:
The fields were relatively clean, as you can see, and the reverse was a toss-up for full bell lines. At MS65 FBL, we’re looking at about $100. At MS66, about $650.
So, as you can see, I cut it out of the 1961 mint set to send to PCGS. (I’ll report on that later.)
Now I am stuck with a silver quarter and dime and cent and nickel that I really can’t consign anywhere. But the point here is, why are we paying these ridiculous premiums for unopened sets?
After some reflection, I think many of us like the excitement of imagining what is inside the envelope. Magnificently toned coins? Errors? Varieties? We are paying for the imagination and the thrill of temptation. “To open or not to open?”–that is the question and the answer here, methinks.
You can find cheaper thrills in a video game.
Here’s the thing: Why pay so much for coins you cannot see? Would we do that at a coin shop or show, let alone online? Better to inspect sets for possible high-grade, toned, or rarer coins and decide whether the investment is worth it.
Or am I missing something? If so, share your viewpoint in the comments below … and relate what experiences you may have had with unopened sets.
Share:
What about unopened proof sets? I have always thought they would be disappointing but finding a nice cameo half or quarter would certainly be a thrill!
Ah, a cameo! I think you’re paying a premium to imagine what’s inside. But that’s OK. I am tempted too.
These “unopened” sets are a fools game. I remember seeing the mint envelopes in pristine condition for sale some years ago. Gee, I wonder what the buyers were going to do with them?
And a lot of these have been steamed open, examined and then sealed back up again by pros and sold as “unopened”.
Great article, Mike. I hope it saves a lot of money for a lot of gamblers on eBay. If after reading this expose, and they decide to buy some, then it’s all on them.
CAVEAT EMPTOR! > Let the buyer beware<
Right on but not the same, buying rolls with the outside coin showing something worth a few extra bucks thinking to my self, boy would it be great if there was 4 or 5 more in this roll. Some people have really gotten good at opening a roll of coins and slipping a end coin in and resealed without making a mess of the wrapper.
Bob–
You’re right! I forgot about the steaming open and inspecting–an old trick. Thanks for mentioning that!
Michael
Gary,
You’re right about those rolls. I did a piece on that for Coin Update a few years back: http://news.coinupdate.com/buying-coin-rolls-online-3344/
Purchasing unopened mint sets is absolutely a negative for me. It is like a pig in a poke. You have no idea as to what is in the envelope till you open it. If you like to gamble and have a lot of money to throw around, be my guest. As for me, I need to see the coin(s) before I buy. I need to know up front what I am purchasing. A lot of these so called “unopened” mint sets are really not unopened. The probability of finding a really unopened set is very very small. I have purchased bulk sets from the mint in the past and have opened every single one of them. I need to make sure that I am getting what I paid for and they are not defective. I also check for error items. I work hard to earn my money and I am sure you do too and I do not have the ability to “throw” it away. With the advent of modern technology, it is way too easy to fake something today. Expensive items require certification. CAVEAT EMPTOR!
Thanks, obie, for your observations. I agree with you 100%. It is always best to see what you are buying rather than buy what you hope to be seeing!
I bought some of these sets you have about ten years ago and they were opened but the seal of the envelope still had the glue intact for most part. After reading your article I checked to see if I had any decent type Half that would be considered MS65 or better. Oddly enough, probably because of the humidity, some of the envelope packages naturally resealed. So I agree with you if you can’t see it don’t buy it because this is a perfect example that can happen where they (Bad Guys) could switch P and D packages that are weaker strikes and keep the nicer ones and you would never know it.
Thanks face. Yet another example of deception — switching!
Where do the future MS 69 and MS 70 and ultra cameo proof coins come from if not from mint and proof sets? Or, if someone was wanting to build a high quality collection of each domination, would it not be more cost effective to buy mint sets than each coin one at a time? Just asking as a hobbyist collector.
Thanks for your comment, Chip. In recent years, the quality of US Mint and Proof sets has been exceptional so that almost every coin, properly handled and submitted for grading, would be MS69 with some a point below or a point above. Sets from the 1950s and 60s grade typically much lower in on the Sheldon scale. But even on recent high-quality US Mint products, it is always best to see the coins than to imagine what is inside them … and then pay a premium for that.
In a few weeks I will be doing a column on double mint sets and the expertise they require to know value. Stay tuned.
Thank you for your reply Michael. I understand that the focus of your article is on unopened sets. I agree that the modern coin sets are of much higher quality generally.
I guess in retrospect, I should have asked, how do you find mint state and proof coins from the 1950’s to the 1970’s that are not already graded mint state and selling at a premium if not by buying unopened sets? Pick a year, and what are the chances of finding a mint state or cameo proof? One in 10, one in 100? Clearly, the population of mint state coins is small in the early years relative to the total number of uncirculated coins but then you have to weigh that against the cost of buying a graded mint state coin. Anyway, I’m intrigued by this which is why I was interested in reading your article.
Based on your experience or any of the other experienced collectors, are you recommending that if someone wants to build a collection of graded mint state coins that they are better off paying for graded mint state coins individually than trying to find them among mint sets? I could ask the same question with proof coins.
The main reason I was interested in this article was because several years ago I invested in mint sets from the 1960’s to modern day. I haven’t broken them up yet and trying to decide if I should do so. However, when I have checked pricing of buying a mint set vs. each coin individually, and keeping in mind the shipping cost for each coin, I thought maybe I was further ahead buying the mint set. Also, often I bought large groups, like all the 1970 sets. I thought the coins for the most part looked very nice but I cannot attest to my grading skills. I did not buy or pay extra for unopened sets because frankly there was no way to be sure that they hadn’t been opened and inspected in the past, so I assume that they were at some point. I also considered the enormous amount of additional time it would take to buy coins individually.
I appreciate the article and comments. Its always helpful to learn from more experienced collectors.
Chip, thanks for expanding on your comment. There will always be exceptions, but we have to face the hard truth: You’re gambling when you think the way to build a cameo or high mint-state collection is to pay premiums for unopened (purportedly) mint and proof sets. Let’s forget about the 1970s. Apart from a few coins and popular varieties and error sets–such as the 1970-D half, 1970 small date cent or 1975 missing “S” proof set–those will be common coins.
Face the difficult truth: There are only a very few cameos, etc., in unopened sets because those older fellows–the ones that write about the good old days–have cherry-picked them long ago. They’re gone. True, you could luck out in some genuinely unopened sets just the same way you can luck out at the casino.
There are sellers and auctioneers that love the gambling mind. There is an auction on Proxibid right now that states about an unopened 1957 proof set: “Scarce sealed unopened envelope set; set inside has for sure never been seen/searched; high grade coins errors/varieties possible; HUGE POTENTIAL VALUE TO $15000+ PER COIN POSSIBLE; these unopened sets sell at a large premium; 5 coins in set.”
The key to building the kind of collection you want is to wait until an old collection comes on the block with opened mint and proof sets, use your grading acumen to tell which is the best buy, and then bid accordingly.
ya, i would seek out these sets. too risky
You lost me after the opening paragraphs. Why on earth would you knowingly pay a premium at auction when you could have paid $30 less just ordering the sets online? The point of the article, I thought, was to illustrate how buying mint sets is a waste of money. All you proved, however, is that you’re easily taken in by auctions.
You’re the kind of reader, John, who does not understand that this is journalism. I do what I do to inform hobbyists, even if I take a loss. I don’t write my columns, as so many so, by offering an opinion based on my years in the hobby or credentials; I do it by fact, as a reporter does, replete with photos. I’m glad you see that there is no value in paying a premium for unopened sets. However, many others are doing so. Worse, unscrupulous sellers are hyping their descriptions to sell sets that in all probability have common coins inside, not worth any premium.
Hi Michael
Great article, always enjoy yours, they are always informative and interesting.
I once put together a birth year set (1968), so I purchased 9 or 10 sets from a dealer online. I bought them at decent price (a little higher than “opened”). Many of the coins were as you suggested, fairly rough, but I did find one MS66 quarter and one MS66 FT dime (P – a good one). This finished my NGC-graded MS66 set. For the remainder of the coins in the sets I broke open, I bought a Dansco year page and placed the best looking remaining coins in that. So now I have a graded set that has some value and an album set that is just neat to look at once in a while.
I wouldn’t have bought sets like this on a regular basis. As long as what you are doing is part of a numismatic project, just keep in mind the “profit” you receive at the end may not be in measured in money as much as in personal satisfaction.
Excellent points, bullsey! Thanks for enriching the discussion.
Michael: We are an “Auction” company. When a seller brings us their items to sell, it is our job to fairly describe & photograph the items as best we can. We generally do not use the term “unopened” on mint/proof sets that we have auctioned. In our auction vocabulary, “sealed” only indicates that the envelope glue is sticking. It may well be sticking because it has been in a high humidity area for years but in no way shape or form do we indicate it was unopened from the mint, unless we have absolute proof. Just as we don’t clean coins, we don’t open glued envelopes. We do not list estimated values in our descriptions. The amount a buyer chooses to pay for any item we sell is their choice based on what we hope is honest accurate information provided by us. That is our responsibility. The buyer’s responsibility is to make informed decisions. We are always happy to answer questions regarding any item we sell. Thanks. Dave & Cheryl Weaver, Weaver Coin Auction
Cheryl and Dave: You know I always list your auction as a top, ethical company. I’ve praised your auctions for years for many of the tenets you recite in your comment. And I’m happy that you list your mint and proof sets as sealed rather than unopened, although I really don’t think that matters. Actually, this article has nothing to do with your auction and everything to do with premiums hobbyists pay for “unopened,” “sealed,” “original envelopes,” etc. The only reason I bid on the sets in your auction, to tell the truth, was that I would rather give my funds to you than, say, this Proxibid seller who states in the description of a 1957 proof set: “Scarce sealed unopened envelope set; set inside has for sure never been seen/searched; high grade coins errors/varieties possible; HUGE POTENTIAL VALUE TO $15000+ PER COIN POSSIBLE; these unopened sets sell at a large premium; 5 coins in set.” Worse, his opening bid was $100.