It was Warren Buffet’s childhood hobby that helped him become a self-made billionaire. At a very young age, Warren displayed an incredible aptitude for business and finance. When he was six, he bought packs of Coca-Cola, priced at 25 cents, from his grandfather’s grocery store. He then resold them for a nickel each, gaining a profit of five cents. That may not seem much, but Warren was making money as a child.
His father, Howard Buffet, was the owner of a small brokerage. Little Warren would observe investors as they were doing their jobs. One day, at 11 years old, he bought three shares of Cities Service Preferred for himself and his sister, Doris. At the time of the purchase, the share was at $38 each. The stocks fell shortly afterwards, amounting to only $27 per share. Warren held his shares, but when the stocks rebounded to $40, he immediately sold them. It turned out to be a mistake; soon after, Cities Service rose to $200. If only he had waited.
Looking at Warren Buffet’s childhood experience and leading example, patience and passion combined can help you make great investments. Of course, buying stocks doesn’t really sound like an entertaining hobby, but there are enjoyable alternatives that can make a sizable profit. Here are three interesting hobbies that can earn high returns in the long run:
Collecting Military Coins
If you have a family member who has served in the military, collecting challenge coins can be a good investment. The tradition is believed to have originated in the Army Air Service during the First World War. Another theory suggests that the ancient Romans also practiced giving coins; others say that these military coins are rather more recent, invented during the Korean War.
Regardless of where it all started, the practice of minting and dispensing military coins have become widespread in the U.S. military. Today, there are several varieties. Each branch of the military has their own challenge coin minter who crafts coins with the squadron’s unique patch or insignia.
In the U.S. Army, they are given to base visitors and standout personnel, and they feature the seal of the Army and other related symbols. Similarly, the Air Force, Navy, the Marines, and the National Guards make and distribute challenge coins the same way.
Sometimes, they make custom coins that are awarded to soldiers who go above and beyond in their line of duty, a symbol of personal achievement and pride. Custom coins are also used to commemorate accomplishments and special events, memorialize fallen comrades, and raise funds for the community.
As such, there’s always a story behind every custom challenge coin. That’s why challenge coins are meant to be carried and displayed and why they make such excellent collector’s items. Given that they carry memories—an unforgettable visit to a military base, a fun trade between friends, a lasting memory of a brave soldier—they are virtually priceless.
But if you’re looking into the monetary value of challenge coins, rare coins do offer a lot of money, especially when they contain precious metal. If you have a gold coin, it can be worth more than a thousand dollars. For silver, it can sell for around $30 per troy ounce.
Collecting Investment-grade Stamps
If you’re wondering how valuable stamps are, the answer is that a tiny percentage can be worth millions. For instance, it was a British Guiana One-Cent Magenta stamp that broke the world record for the highest sale at 9.48 million U.S. dollars.
It’s one thing to collect stamps for pleasure; it’s another to purchase them for investment. But it always pays to look into your collection to see if they can benefit your portfolio later in life.
To know how much stamps are worth, studying philately and postal history is a great step.
Valuable stamps all tell a story that has a historical significance. But history isn’t the only factor that makes investors willing to pay big money for stamp collections. Rarity, condition, and authenticity also play a vital role.
The rarer the stamp is, the more money you can get. But you need to make sure that it’s in perfect condition. Investment-grade stamps are graded in quality before the value is determined, and this can range from superb to poor. To gauge a stamp’s condition, look for signs of tear, off-center designs, and fading colors.
If you love collecting autographs of notable cultural icons and celebrities, hold on to those signatures. Because autographs have a hedge against currency fluctuations, they can actually diversify your asset portfolio in the future. Indices show that the value of most sought-after autographs is increasing by 12 to 16 percent in the last decade.
To calculate the value of your treasured signatures, you need to look out for the demand, rarity, and condition of the autographs. For instance, a hand-written letter from a famous person will get you a higher monetary value than autographs on album covers.
Always store signed memorabilia properly; the slightest damage can significantly reduce their value. Tampering, framing, or mending will also decrease their worth. Finally, make sure that they’re authentic, as only genuine signatures are investment-grade.
The Bottom Line: Keep It Fun
Hobbies that involve collecting valuable stuff are almost always only profitable when you wait for years. That’s why it’s also important to enjoy the act of collecting items rather than buying them solely for money. By knowing what makes these collector’s items a great investment, you can make some money from your hobby in the future.