Heritage Auctions

My friend, John Jay Pittman, though not a wealthy man to begin with, built a vast and famous coin collection. He accomplished that feat by studying relentlessly, then shrewdly investing a large percentage of his limited income as a middle manager for Eastman Kodak and his wife's income as a schoolteacher. In 1954, he mortgaged his house to travel to Egypt and bid on coins at the King Farouk Collection auction. John sacrificed his and his family's lifestyle over the course of many decades. He passed away in 1996, with no apparent regrets, and his long-suffering family justly received the benefit of his efforts when the collection was sold at auction for over $30 million. But why did he do it?

Pittman paid $400 for a Canadian 6-piece 1936 Dot specimen set in 1954. Auctioned in 1999 for $345,000

One fervent collector of historical documents refers to his own collecting propensity as "a genetic defect". More likely, collecting is a basic human instinct; a survival advantage amplified by eons of natural selection. Those of our ancient ancestors who managed to accumulate scarce objects may have been more prone to survive long enough to bear offspring. Even today, wealth correlates to longer life expectancy - and could any form of wealth be more basic than scarce, tangible objects?

But more relevant than the reason you happen to collect Lithuanian first day covers or 1950s romance comic books today, are your long-term goals in seeking them. Understanding your goals may help you achieve them.

If you collect - or ever plan to collect - anything, your first priority should be to develop an honest self-awareness of your personal ambitions. You might even try to predict how those ambitions are likely to evolve throughout the remainder of your life.

For example, in addition to the instinctive predilection previously discussed, the most common reasons people collect things include:

• Knowledge and learning
• Relaxation and stress reduction
• Personal pleasure (including appreciation of beauty, and pride of ownership)
• Social interaction with fellow collectors and others (i.e. the sharing of pleasure and knowledge)
• Competitive challenge
• Recognition by fellow collectors and perhaps even non-collectors
• Altruism (since many great collections are ultimately donated to museums and learning institutions)
• The desire to control, possess and bring order to a small (or even a massive) part of the world
• Nostalgia and/or a connection to history
• Accumulation and diversification of wealth (which can ultimately provide a measure of security and freedom)

The motives listed above, and others, are not mutually exclusive. The majority of collectors reap several - often most - of these benefits, though some may invest excessive amounts of time, energy and discretionary funds.

Like John Pittman, Robert Lesser is a true collector, but also a visionary with an ability to change his own course. He funded his subsequent collections by building a fine collection of Disney memorabilia before anyone else was interested, then selling it for a seven-figure sum once the collecting world caught up with him. Lesser went on to assemble, long before anyone else discovered their now-obvious appeal, the all-time greatest collections of toy robots (museum exhibitions of his collection have attracted sell-out crowds with waiting lines stretching over city blocks) and pulp magazine cover paintings. I highly recommend his book on the latter, elegantly titled: Pulp Art.

Robert Lesser's collection of over 250 rare robots and space toys has been exhibited at several museums and is considered among the finest in the world.

Many non-acquisitive pastimes provide similar levels of satisfaction, knowledge, recognition - and other benefits of collecting. But unlike home gardeners, tropical fish enthusiasts, and similar hobbyists, serious collectors of rare objects will very often find that they have created substantial wealth at the end of the day, especially when they acknowledge, at least to themselves, that doing so is one of their goals.

Therefore, this column will focus primarily on helping collectors make more intelligent financial decisions, improving the monetary value they ultimately reap from their collecting endeavors. Non-financial topics will be covered as well. If you have comments or questions, or would like me to address topics of particular interest to you, please write or email me anytime.