How many of us have a “prized” collection of such things such as Hummel figurines, carefully purchased “collectible” gold or silver coins, “collectible” sports cards, treasured wedding presents, or grandmother’s china set?
I listened to a nationally known collector of comic books earlier this week and I thought of my own collections of “stuff” that may be of value or interest to me and none of my heirs. That got me to thinking of collections I have helped value and the number of times the executor had no idea of the value of the collection I was asked to value. Sadly, there are usually two very distinct points for most collections: one being that the collection has no value at all; two that the collection is worth astronomically more that its real value. If you are one of the many of us who have amassed various items that hold either real or sentimental value I would suggest that in your estate planning you consider taking some actions to ensure that first they go to someone who will value them; and two that the monetary value is ascertained accurately and recorded.
Let’s deal with the easiest first. Whatever you are considering giving to an heir or heirs, first ascertain that they would be willing and eager to have the item(s). If they are, fine, proceed with the estate planning. If they have no interest in the items, have them valued and either convert them to cash so that the cash can go to a loved one and save them of the burden of valuing and disposing of the item. You are probably the best person to know of and be able to describe any particular facet of your item that will increase its value. For instance, if an item has been owned by someone of note, and you can document that, the value increases, sometimes exponentially. There might be a small number of items in a large collection that have a great value, while the majority of that collection is sentimental and has little financial value at all. An heir would probably be ignorant of such facets of your collection.
The second action you might take is to make note of a reliable and trusted dealer or appraiser that would be familiar with your collection and be relied upon to advise your heirs of the value or recommend the various ways in which they could be disposed of if that is the direction preferred. To avoid sticker shock you might also note that the common appraisal fee or commission could range up to 40% of the value of the collection.
Whatever you decide to do with the items and collections that have meant so much to you over your lifetime, know that everyone may not hold the same sentimental value as you do. Also know that it is entirely possible that the monetary value you think they may have is also subject to subject to disappointment due to market fluctuations and/or to misrepresentation on the part of the party selling them to you initially.