Obtaining a stamp collection appraisal can be a very smart move depending on your situation and plans for your collection.
If you are a stamp collector with stamps of significant stamp collecting value then getting a professional to assess your stamp collection is likely required for an insurance policy and can also be a powerful negotiation tool if you're looking tosell stamps.
From a future planning perspective, having your stamps valued by an expert will help reduce the risk of burdening your family with having to figure it out should anything happen and it will provide a basis of valuation for an insurance policy.
That peace of mind is enough to convince me that getting an appraisal on a semi-regular basis is a good practice.
How frequently you need to do so really depends on your collection. If you have an extensive and fast growing (either in size or value) collection then more frequent is better. But, if you're not an extremely high net worth stamp investor, then you may only need to document your collection's value every 5 to 10 years.
They key question is whether an appraisal is worth the cost. The good news is that most appraisals are a relatively small expense and some insurance companies reimburse you for all or part of the cost of a formal stamp collection appraisal.
Whether you're planning to sell an inherited collection or just want to know what your stamps are worth for insurance purposes, getting a stamp collection appraisal can make a lot of sense.
Stamp Collection Appraisal Key Info
Stamp Dealers are the main provider of the stamp collection appraisal source so you will need to identify an honest and reliable stamp dealer.
Appraisals are not free - many stamp dealers charge about $50 an hour with an average collection taking a few hours. For high value collections this can be a cost effective way to get an idea of the collection's value.
Ensure you receive a hard copy and electronic copy of the official document. If you are getting an insurance appraisal, you must check with your insurance provider for the list of required information. I recommend, at a minimum, the following.
This appraisal document must include a description of the material included, a value of the material, a definition of whether it is an insurance, retail or wholesale value, and a date and legible name of the performer. Check with your insurance company for their policy requirements.
1. Description of Material included
2. Definition of the Type of Appraisal
- Insurance or Retail – this is a ‘replacement’ value assessment. In other words, if you were to buy all the stamps at full retail prices, this is what you would expect to pay.
- Wholesale – this is what you could reasonably expect to sell the collection for if you put time and effort into breaking down the collection and selling it off in pieces through numerous sales channels
- Cash Offer or Liquidation –
What you could expect to receive if you sold the entire collection as a single unit right now
Dramatically lower value – a collection with a retail value of $100 likely has a Liquidation value of $5 to $20.
If you ask for this type of assessment, make sure you are clear that this will be an offer to buy. In other words, when the appraisal is complete you should be able to either pick up your collection with documented assessment or a check for the appraised liquidation value.
Ensure you are clear about how long the offer stands -longer is better so you can shop around for the best price.
3. Collection Value with a definition of pricing methods and catalogs used
4. Name, Address, Signature and of the Appraiser
5. Business ID and Reference ID of the Appraiser
- You should only use a stamp dealer that is registered with their state to conduct business and has a Business or Tax ID number issued by the state corporation commission
- Nearly all reputable stamp dealers are also part of one or more industry associations, such as the American Philatelic Society (APS) or the American Stamp Dealer Association (ASDA)
6. A Dated Invoice showing how much you paid
One advanced negotiating technique is to obtain a Liquidation or Cash Offer Stamp Collection Appraisal in writing and use that as a starting point for negotiating a sale with a different stamp buyer.
If nothing else this will give you a minimum floor to know where to walk away. But, assuming they agree with the written offer value, most dealers would prefer to pay slightly more than to not buy the collection at all.
If a stamp dealer isn't willing to match the first offer you should run back and accept the original offer!!! Most likely, you won't find a better one.
Regardless of how you plan to use the assessment, there is one key to remember. Clearly discuss and agree what will be provided on the official stamp collection appraisal. Taking 5 minutes to get an exact agreement on what will be provided will ensure you don't have to deal with the hassle and frustration of receiving a document that doesn't meet your needs.
Along those lines, be sure to discuss the "Value" the appraiser will document before they start. It is extremely important to know whether this is a Retail or Liquidation assessment.