Inherited a Collection? Now What?
So you’ve just inherited a collection huh? While each situation will differ, the most difficult decision is often the most basic one: do you keep it?
Safely store the collection
Understanding that time will be needed to make decisions about what to do with the collection, you should quickly find a secure and accessible place to store it. As a general rule, store the collection in a cool, dry place away from light, humidity, and moisture. This will ensure the collection remains out of harm’s way while you decide what to do with it.
How much is it worth?
The value of the collection typically has the greatest impact on how to proceed. But how does one go about assessing value? While seeking a professional appraisal is often the preferred choice, there are a few things you should do beforehand.
Owner’s notes: Most collectors keep notes, inventory, receipts, and other documentation related to their collection. Often times, these details are located alongside the collection itself; stored in boxes, notebooks, binders, etc. The more disciplined collector will even leave specific instructions in their Will to guide their heirs on what to do with it.
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Insurance policy: There are typically two types of insurance coverage that a collector will purchase for their collection. The first, and most common, is an insurance rider — also referred to as a floater or an endorsement — that is an optional add-on to a home owner’s insurance policy. This type of policy typically provides additional coverage for things you own that are worth more than the per-item limit of your homeowner’s insurance policy; or, in some cases, provide protection for things that may not be covered at all by a standard policy. The second, and more specialized, is collectible insurance; typically purchased from a specialty insurance provider. To understand the differences between the two, read our article on insuring your collectibles.
If such policies are in place, contact the insurance company to gain insight on what was covered and the collection’s worth.
Talk to dealers: Most collectible genres are represented by dealers, shows, and clubs. Consider taking the collection to a dealer and asking them how much they would pay for it. If you’re able to visit a show, offer the collection to several dealers and compare their offers.
Formal appraisal: If you’re still not satisfied or confident in the valuation of the collection, you may want to conduct a formal appraisal. Depending on the type of collection you’ve inherited and where you live, expect to pay anywhere from $50 to $125 an hour for a professional appraiser’s services.
RELATED ARTICLE: 7 Things to Know About Professional Appraisals
Before moving forward with an appraisal, make sure you’ve agreed on the cost and basis for valuation (resale or replacement value). Also, don’t be surprised if the appraiser doesn’t include every item in the collection in their final valuation. Being that most of the value in a collection comes from a small percentage of items, the appraiser will base their valuation on those items versus the more common ones.
Should you keep it?
Now that you’ve determined the value of the collection, the question persists: do I keep it? When you boil it all down, you really have four choices:
Keep it: You could keep the collection for yourself. You may choose to do so purely for sentimental reasons or as a financial investment.
Pass it on: You may decide to gift the collection to someone else within your family. For instance, although you inherited the collection, there may be someone else who’s expressed interest in it. In this case, the collection would be more valued in their possession, not yours.
Donate or loan it: A local museum or other non-profit organizations may be interested in the collection. If you’re interested in exploring this route, read our article on loaning items to a museum.
Sell it: Ultimately, you may decide to sell the collection. If this is the route you decide to go, the next question you’ll encounter is: how? A collection’s value, how much you expect in return, and the time you’re willing to dedicate to selling it, are all determining factors in choosing the sales approach best suited for you and your situation.
Know what you have
In closing, we cannot emphasis enough the importance of understanding exactly what you’ve inherited and its estimated value. Researching the collection and its value is by far the first, and most important step in answering the question: do I keep it?
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