Maybe your in possession of Civil War correspondence between notable historic figures that your great-grandmother gifted to your family back in the 1950s and you’re thinking of taking to Antiques Roadshow. Or maybe you’re a connoisseur of early Picasso drawings and actually own a few. Whatever the personal treasure lying in the back of your closet, tucked away in a safety deposit box or stashed somewhere so secret we can’t even write about it here, these “investments of passion” or “emotional assets” are certainly worth protecting. And as this article in Forbes explores in depth, collectibles can be a good chunk of net worth for some wealthy investors. So for Utah residents, take heed of the free Forbes advice, or ask your own asset protection attorney in Salt Lake City: what should I do with these highly valuable items?
While we’d all like to have money, money, money, it’s human nature to get emotionally attached to things. And for the already wealthy, it’s easier to get attached to things that are valuable, er, that is, monetarily. In fact, a Barclay’s report in 2012 stated that around the world, high net worth households stashed almost 10 percent of their wealth in collectibles. That’s quite a big portion of wealth that hangs out in cabinets and safes in a physical, touchable state – a state that can make such investments both less and more risky, an asset protection attorney in Salt Lake City would warn investors. Less risky because intrinsically valuable collectibles are less subject to market fluctuations than say, mortgages or stocks and bonds, but more subject to damage and, well, physical destruction.
Forbes is well aware of this conundrum for investors, and analyzed the long-term return of art, stamps, violins and wine, as a sampling of collectible items. Intriguingly, they found that the returns for these types of collectibles “are in excess of bonds, bills and gold.” This both before and after adjusting for inflation. Noting that stocks are an exception (and collectibles were found to be “trailing” stocks in attractiveness) this is something you’d want to explore in more detail with your financial advisor and asset protection attorney in Salt Lake City before diving in and ruffling around your portfolio.
Something that Forbes was keen to point out about collectibles like violins and art was their illiquidity. (Wine’s liquidity is another matter altogether, and its personal value as an intoxicant wasn’t taken into consideration in this strictly financial evaluation of investments). Depending largely on sales at auctions, most collectibles are hard to translate into cash with reliability and ease. As an asset protection attorney in Salt Lake City would likely remind Utah residents, it’s the balance of loving the things for themselves, and keeping them around for their value that each collector has to strike in investing.
Forbes agrees, and while it notes that its article “focused almost completely on the financial returns from the investments in collectibles,” most collectors “are likely drawn to the psychic returns or the pleasure the owners derive from these purchases.” Basically: be careful, and enjoy what you have, which is pretty much sound advice for life in general, too.