Selling It
Many collectors think abstractly about selling off their collections, but few do it. What is it really like to do it? How do you do it? What does it leave you feeling like? Several years ago, I had to face the ultimate test for an active collector, selling a big chunk of my collection to pay for my daughter’s education. I made notes at the time and hope my experience will be helpful to you if you are facing a similar situation.
Like many collectors, I have an ongoing, long-term eBay and auction addiction. I revolve items into and out of my collection continually and have been doing so for about 35 years since I returned to collecting after a several year hiatus to chase girls (I was a ton better at cards, BTW). When I was single and buying cards--the first ten years or so after I returned to the hobby--it really didn’t matter because if I paid my bills the rest was play money. As a student I’d been used to living very cheaply and when I got out of school, I really didn’t change my tastes, so I was living like a student on a lawyer’s salary.
Then I met a girl and things changed, especially after I got married. Not at first. The first few years we were DINKs: double income no kids. It was great. I pulled a decent salary, and my wife just about equaled it. We lived in a small place that cost us less than 10% of our gross income, and our cars were owned. We definitely enjoyed the high life with multiple vacations each year and lots of fun and games. Plenty of money for cards, too.
Things sort of changed when I opened my own law practice. Working for yourself means that each month you get to figure out how you will get paid that month. I won’t bore you with the details; suffice it to say that the first few years of my practice were quite choppy, financially speaking. Meanwhile, just as things were taking off, my wife got pregnant and she--er, we--decided that she would be a stay-at-home mom until the kid went off to school. Our income dropped 40% and I became sole breadwinner for the family. By the time my wife fully returned to the work force it was 2007. The Great Recession hit, she lost her job, and spent another two years in involuntary non-working status.
One rule I always had for myself was never to rob the family to buy cards; never spend money I needed for something else and no debt for cards. I am very proud of the fact that my family never wanted for anything we really needed and there were lots of bonuses too. If we wanted a vacation, I got it. I paid cash for braces, covered various household and other calamities, and made sure there was enough. I always justified my card spending by saying that I don’t golf or go out to bars or do other ‘manly’ leisure activities that simply consume money, that at least I can recoup most of my expenditures--perhaps even profit--when I decide to sell.
What I spent on cards wasn’t a bothersome issue until 2008. Well, we all know what happened in the Great Recession. By the time the carnage was over we were out roughly two-thirds of our assets, with college for my kid looming on the horizon in 2017.
Since we knew college was a coming expense, we sought financial planning help to get us started with the process several years before we would need the money. We went through the financials and arrived at an aggressive savings plan that projected out to about cover the costs if we started immediately. Funny thing about plans: life intervenes. We started a year with two owned cars; we ended it with two dead cars and over $1,300 a month in new car payments. To round out a crappy money year, our sewer main line had to be replaced. It turns out that piping the poop out of your house is grotesquely expensive. Totally worth it, of course, but very costly. The savings we had accumulated towards the college program went bye-bye to pay for it all. Toughest of all, financially speaking, my daughter announced that she wanted to become a doctor. Four years of school became eight, with the last four at a projected $50,000+ a year just for tuition. At that point it was readily apparent to me that we would have to make up at least $175,000 of the savings goal somewhere and my collection was the only asset I could tap, so I had to do it.
Emotionally, deciding to sell a beloved collection is a lot like coming to terms with an impending death. One of the first things a very astute friend asked me was whether I had come to terms with the decision itself. I had not, so that was my first task, to deal with the emotional toll of the ‘death’ of my collection.
I love the scene in All That Jazz where a comedian riffs on Elizabeth Kubler-Ross’s breakdown of the five stages of death:
“This chick, man, without the benefit of dying herself, has broken down the process of dying into five stages: anger, denial, bargaining, depression and acceptance. Sounds like a Jewish law firm. 'Good morning, Anger-Denial-Bargaining-Depression-Acceptance!'”
I found myself going through these feelings.
Denial was first for me. I kept thinking--honestly thinking--that the money thing would somehow just work out. Then, when I realized that the math was inexorable, I was so pissed off that I had to sell from my collection. I blamed my wife, I blamed the world, I blamed everyone. None of it fair and most of it not even true, but it swirls through my head and the tantrums happen. Closely followed by depression. I heard that depression is rage turned inwards, and that makes a lot of sense to me that I would mope around for a while after fuming. I was soooo pissed about having to sell that the reality of it just bummed me out completely. Eventually, I came to accept, I manned up, and decided to get the job done in the least awful manner I could muster.
Where to start, where to start?
The good news was that I had a few years to work on it, so I did not have to hold a fire sale. The acceptance phase of card death, so to speak, took the form of card triage, carefully dividing my collection into three groups: items I really like and want to keep as long as I can, items I think are good investments to hold, and everything else.
Deciding what I really wanted to do, long term, with my collection wasn’t an easy question to answer, at least for me. I like a wide variety of cards and memorabilia from many eras, sports, cultural segments, etc. I don’t know anyone else who collects basketball cards, boxing cards, Groucho memorabilia, baseball cards, Lucille Ball stuff, football cards, hockey cards, exhibit cards of all sorts, rock and roll autographs, team issues, premiums, Star Trek, Bruce Lee and Kung Fu (the tv series), 1970s wuxia, art nouveau Japanese postcards…you get the idea.
What was easy to set aside were the untouchables: any card I owned when I was a kid. There isn’t a ton of value there (the best card is a T206 Walter Johnson I got when I was 12), but I would never sell them. I also set aside a few weird things that just make me genuinely happy to own them, like a rare collection of H815 Adam Hats premiums I’d amassed over the years and signed Star Trek original series cast cards.
I also had come to realize, after buying a few collections, that I am just as happy having lower grade raw cards in binders rather than slabbed higher-grade cards. My first effort was to liquidate the higher grade slabbed mainstream postwar cards I had amassed and replace them with lower grade raw cards. That turned out to be kind of fun. I made a game of seeing how much I could get for the slabbed card and how little I would have to roll over into an acceptable replacement. In some cases, I was able to sub in a new card I liked for 10% of what the old card sold for.
My next big question was what to hang on to as an investment. Now I know that the I-word is a dirty one to some, but damn it, Jim, there’s real money at issue here. I was bitterly aware that if I’d been utterly mercenary about what I purchased in 1990, I’d have been looking at selling a handful of cards to fund my daughter’s educational needs instead of gutting my collection, so I was absolutely going to think long and hard about what made investment sense to keep. It was a struggle, and I was fortunate to get it mostly right (misjudged the sale timing on a 1954 Topps Aaron PSA 7 RC, but what’s $25,000 among friends…). If I was faced with that dilemma today, it would be easier. With all the data scraping, aggregating and analytical tools available, it is now possible to read the market and determine what has potential with an ease that was not the case when I had to make the judgments.
After I pulled the sentimental stuff and the investment stuff, the remainder of my collection was up for grabs. My view on liquidation of any group of cards is to start with the commons and the crap and work your way back to the really good cards. See what you can get out of the junk. Maybe it covers your needs, or your costs, and you still have the best items to work with. If not, you sell until you get what you need out of it.
I will spare you the granular details of what I sold. How I sold is more interesting. I worked with auction houses, consignment sellers and retailed myself on eBay. Each has its own merits and negatives.
Auction houses offer a one-stop solution for the cost of the buyer’s premium. With all of the auctioneers out there, take time to look around and you will find a 0% commission auction. Nothing I had was of sufficient quality to ask for a share of the buyer’s premium. By that I mean that if you are selling a T206 Wagner, you can bargain for most of the BP. With a high six or seven figure card, that is a deal any auctioneer will take. My stuff, though, best I could do was a 0% commission.
Not all auctioneers are created equally, though. All of them can sell a slabbed 1956 Mantle, but if you have something oddball or esoteric, you need to choose an auctioneer with experience and a customer list to match. Formatting is also important. If I am selling a large collection of slabbed cards, I want an auction that will sell the cards as singles, or as close to it as possible. Most of the large auction houses now have two tiers of auctions, the premium catalog auction, and the monthly internet only auction. The latter is where your meat and potatoes graded cards belong, to be sold singly at what amounts to retail. If you let an auctioneer throw 100 of your slabbed cards into a grab bag lot, all you have done is hand a middleman--a dealer--a guaranteed profit when he buys the lot at a discount. I’ve made a ton of money breaking down and retailing cards that were inadvisably put into mass lots. You absolutely must grab the bull by the balls and make yourself heard on lotting decisions before you consign. If the auctioneer insists on doing things that you know are not to your financial advantage, pass and look for someone else.
eBay consignment sellers are akin to auctioneers. Same comments.
If you have an eBay account and you are interested in retailing, then by all means go for it. Selling at retail to collectors is probably your best route to extracting the most money. It is, however, a giant time-suck. If you don’t want to spend your leisure hours scanning, listing, and packing stuff, and then accounting for the results, go to an auctioneer. And there are the people on eBay. Some real idiots, crackpots and crooks there.
The other thing I did, and it has become a way of life for me, is convert to what I call a “kill-eat” collecting model: I can only spend what I earn selling other cards. It turned me into a picker and a flipper, which is fine. The pandemic was godsend in that regard: I sold into it very heavily.
In case you were wondering, I was able to stop selling cards for my daughter’s education fund once she decided against medical school. Turned out she did not like clinical work. I still had the core of my collection intact. I also had a newfound appreciation for planning for expenditures and for the work of being a card investor and seller.
My take-away for this segment, my younger brethren, is to plan for the long term now and pay yourself first. I had a hell of a good time amassing my collection, but I wish I’d realistically assessed my 2017 cash needs in 2000 and started saving then instead of just impulse buying every card I wanted.