Author: Mr. Ian Yeates, 2019-2020 President, Regina Philatelic Club, Inc.
One of the items a loved one may leave his or her family is their stamp collection. Reactions to such a bequest generally follow one of two lines: gratitude and appreciation for the inheritance and a resolution to continue the collection; or, rather more commonly, ‘what am I going to do with it?’
The first reaction is, of course, not a problem. The second forms the subject of this note.
“What am I going to do with this stamp collection I have just inherited?”
The simplest option is to find another collector within one’s family circle or with one’s friends and acquaintances who might appreciate it and give it to them. This may not always work depending on a number of factors. Perhaps the accumulation is too large and daunting for another person within one’s circle to take on. Or, the collection might be poorly or only slightly organised and so represents work that friends and relatives decline to take on. In either circumstance this would leave one with the problem of disposal.
Investment Collections versus Hobby Collections
A short digression is perhaps appropriate here. Some collectors have an investment objective in their collection. Such individuals accumulate expensive stamps, often via auction in centres such as New York, London or Paris. Often rarities sell for thousands of dollars at such events and are stored in safety deposit boxes with a view to selling them later at a profit. This type of collection is an investment and is similar in nature to that of antiques, rare coins, and even fine art. Usually an owner of such a collection will have a well organised liquidation plan, and any heirs would almost certainly have clear instructions as to how to dispose of it.
The collection that is the subject of this note is a hobby collection, which is by far and away the typical circumstance. Usually there is no well organised liquidation plan at all, nor are there any instructions for an heir to follow in order to dispose of the collection. The notes that follow are intended to provide some guidance to such an heir.
The Rough and Ready Valuation of a Collection
If giving the collection away has not proven successful, the next option open to the heir is to try and sell it. There are many complexities with this option which will be explored. The first question to resolve is the matter of value. What is the collection worth on the market?
This question is often of great interest on inheriting a collection, with many hoping to secure significant sums for what they have received. People have ‘heard’ that ‘someone’, ‘somewhere’ sold an inherited collection for several hundred thousand dollars and naturally hope to be equally lucky.
This understandable wish is very, very rarely rewarded by success. Most collections are modest affairs, with middling values, particularly if the collector was not personally well off enough to afford to buy rare and expensive stamps – which describes almost all collectors. This does not mean that there is no hope of finding rare and expensive stamps in a collection. But it takes digging and research.
Determining value is a complex question and fraught with difficulties, particularly for the non-expert. An initial step is to seek out a stamp catalogue – the Scott Standard Postage Stamp Catalogue is the most appropriate for world-wide collections and the Unitrade Specialized Catalogue of Canadian Stamps is ideal for a Canadian collection. Helpfully, the latter uses the Scott numbering system. With luck the inheritance will include a catalogue – even if dated, it will provide an indication as to value. It should be noted that there are a variety of other catalogues produced by many countries that have issued stamps with their own numbering system, but for simplicities sake we will assume the Scott Catalogue will be used.
The Scott Catalogue can be found in public libraries and specific stamps can then be looked up to see what the value is. The numbering system, common with all catalogues, starts with the country in question’s first issue and proceeds from there. As the first stamp issued, Great Britain’s Penny Black from 1840, was rapidly followed by all of the world’s countries in the years thereafter, with numbers issued in the several thousand for most countries (e.g. Great Britain has issued over 4000 stamps since 1840). However, geo-political events in the approaching two centuries since 1840 has meant a bewildering variety of postal administrations, name changes and so on. This needs to be kept in mind. For some countries, such as Canada, the United States, France or Great Britain the changes have been minimal. Others, such as many found in Africa, the Middle East and Eastern Europe have had complex histories and so have complex postal administrations.
As a rule of thumb, value and age are linked. Stamps issued, to use the Commonwealth experience as an example, during the reigns of Queen Victoria (d. 1901), King Edward VII (d. 1910).and King George V (d. 1936) tend to be more valuable than those issued for the reigns of King George VI (d. 1952) or Queen Elizabeth II (still reigning). Stamps with a higher denomination will also tend to be more valuable than those of lower denomination – this is due to relative scarcity. Higher denomination stamps were issued in far smaller quantities than lower denomination ones – for example a Canadian Queen Victoria 1897 $5 stamp (catalogue value of $800 for fine used, 16,500 issued) is worth far more than the 2¢ example ($9.50 fine used – 2.5 million issued) from the same set.
Recent decades have also witnessed a proliferation of issues by virtually all countries as a money-making endeavour by their postal administrations. Collecting such stamps is an enjoyable part of the hobby as costs are reasonable, the designs often very well done, and provide an interesting reflection on what various countries find important in their history, tourist sites, natural resources and issues to commemorate or promote. This is what makes the hobby so compelling for most collectors. However, the value of modern issues is correspondingly low as the volume issued is high and availability straightforward. A collection of mint or used stamps from the 1960s on will have modest value, even if comprehensive (e.g. a complete Canada collection from the 1960s to date is not scarce).
With this brief background in mind, examine the collection and check out the values of the older stamps to see what the catalogue value might be. There is no need to assess an entire collection in this way, but a bit of spot checking can provide a useful indication as to the overall value of what you have on hand.
The Detailed Catalogue Value of a Collection
Now that some slight idea as to the catalogue value of your inherited collection has been determined, we must now explore what the market value might be.
As already touched upon, age and denomination are important factors in assessing the value of a collection. One that has a large quantity and range of early issues for a given country could well have considerable catalogue value. One that has only a few older stamps and is largely comprised of contemporary issues is likely to have a very modest value. However, it needs to be understood that some, for example, Victorian era stamps (now over a century old) are common and have a low value accordingly. Just being old does not necessarily translate into ‘expensive’.
All to say, there are a number of elements in a collection that will affect its market value. We shall review the major ones.
Mint and used stamps are the two basic types of any given stamp issue. Mint stamps are those that have not been postally used and so retain the gum on the back (current self-adhesive technologies have replaced the original gum versions). Used stamps have been affixed to an envelope or parcel and so have gone through the postal system. Normally they have been cancelled to indicate that they have been used and so not peeled off and used a second time.
Mint stamps that have not been hinged and stuck into an album are worth more than stamps that have been. These are abbreviated as MNH – Mint, Never Hinged.
Used stamps that have a light cancel – one that does not obliterate the design – is worth more than one that has been heavily cancelled.
A variety of used stamps worth noting are those that are still on the envelope and have been postally used. Some envelopes illustrate the adventures that a given piece of correspondence has had in getting to its intended address. Such details are often of great interest to collectors and a relatively common stamp soaked off the envelope that is worth little can be quite expensive on cover.
The exception here is a post office product known as ‘first day covers’, which is a decorated envelope that has a stamp or set of stamps cancelled to order on the first day of issue. Often the graphic art involved on the envelope is well done, but the value tends to be nominal.
Mint or used stamps that are fresh and clean, nicely centred, and with intact perforations, without creases or tears are worth more than examples with any of the above noted imperfections.
Technical elements include watermarked paper – designed to inhibit forgery – and various phosphor tagging marks (visible with an ultraviolet light) – designed to permit automated sorting by the post office – add to the value equation. Occasionally the watermark is upside down or sideways. Occasionally the phosphor tagging is incorrectly applied. Occasionally different batches of a single design have differing perforations – designed to assist in separating individual stamps from a sheet – with one being quite rare and expensive, the other common and cheap. Generally, it is older issues that exhibit some of these varieties and complexities. Stamps issued after 1960 have far fewer features along this line.
The catalogue value is dependent on all these factors. Condition is critical, particularly for used copies. Mint stamps that have been hinged is normal for stamps issued prior to the Second World War. Stamps thereafter that are hinged will sell at a discount.
Taking all these matters into account will generate an approximate sense as to the catalogue value of a collection. It should be apparent that determining comprehensive and thorough catalogue value of a collection is significant task and one that will take a great deal of time to thoroughly and accurately complete.
The Market Value and Selling a Collection
Once you have a sense of what the collection may be worth, either by a rough and ready examination of the collection, or by a detailed valuation of the catalogue prices, you can then seek to sell it via one of the options below. However, it is important to understand wholesale and retail prices. The catalogue lists retail prices for stamps in fine condition. This is the price a stamp dealer will use as a reference when he or she sells stamps to a collector. Very often the selling price will be at a discount to the catalogue price based on a wide range of factors, particularly condition. Lots of collections have material that is in poor condition and so worth very little. Scarce material may sell for above catalogue value if demand is sufficient. However, as is the rule for any retail operation, the dealer needs to buy his or her stock at wholesale prices in order to make a profit and earn a living. If the dealer operates a shop, then there exist significant overheads to pay for. Many dealers have focused on stamp shows, such as noted above, or sales via the internet (more of which below). However, the basic reality remains unchanged – the dealer will pay wholesale prices for his or her material, not catalogue prices.
A collection will only garner a fraction of the catalogue value. What that fraction will be is dependent on a number of factors beyond the basic question of condition.
Organisation – A collection that indicates the catalogue number of the stamps, is neat and orderly, with most of the material clearly in good to excellent condition, will secure a relatively high percentage of catalogue value. A collection of loose material in a shoebox will be worth almost nothing. Essentially, the dealer will have to do all the work of organising and cataloguing such an accumulation, with no certainty of having a value anywhere close to the amount of work involved.
Demand – The business of selling stamps involves the necessity of a significant inventory. Inventories cost money. Consequently, it is essential that a dealer acquire material that he can sell to collectors fairly quickly, or at least in a reasonable time frame. Depending on market factors a collection can have a considerably high nominal catalogue value, but almost no interest. Stamp collecting has its fashions just like anything else, and so sometimes fairly scarce material sells for relatively little and often less than much more common issues that ‘everyone’ simply has to have.
Errors, Varieties and Oddities – Accumulations will occasionally possess such material and consequently can attract a premium for the entire collection. This type of stamp involves some sort of departure from the intended design. It can involve anything from die flaws associated with the printing plates, to colour shifts, perforation shifts, and missing or wrong colours. A level of expertise is required to detect examples of such stamps. Hopefully, any inherited material will indicate such examples as most collectors would highlight these philatelic prizes. Some errors are worth a great deal of money, others not much more than a regular version of the stamp in question.
Revenue and Telegraph Stamps – Occasionally collections will have a number of stamps that served a revenue purpose (e.g. for tax payments or contract stamp duties) or were for use by telegraph offices. These items look very similar to regular postage stamps and occasionally regular postage stamps were used for these non-postal purposes. Often instead of a postmark such stamps will sport a signature in ink. Others specifically have “Revenue” or “Telegraph” incorporated into the design and so can be readily identified. Other uses include consular stamps for various fees, law stamps, weights and measures stamps, excise taxes stamps, ration stamps, savings stamps, and many other purpose specific types too numerous to list here. Generally, this use of stamps ended during the Victorian era or certainly by the mid-Twentieth Century. It is a highly specialised area of collecting and valuing such material requires the appropriate catalogues. These are not readily available and one is encouraged to contact a dealer for advice (see below).
Many collectors may have a few such stamps but only as curiosities. Relatively few collect such material in a comprehensive fashion.
Purchaser – There are three potential purchasers for a collection. Ideally, another collector will make an offer for the collection for his (or her) collection. This may well get one the highest price.
The second option is to sell the collection to a dealer. As noted above the catalogue value and the selling price are not the same thing and hence the critical question will be the scale of discount. If the collection is not organised the dealer will be forced to assess the value of the collection to his business by eye. If you have done some homework and have been able to identify a collection’s more valuable elements you may secure a decent percentage of catalogue value. If you have not, you will have to rely on the dealer’s assessment and take it or leave it.
The final option is to sell the material via the internet such as E-bay or some similar on-line option. This approach involves considerable labour in describing the material, determining a minimum price and then managing all the shipping and customer issues that are part and parcel of retail life. Lots of people do this, but be aware of the implications and labour involved. That said, this route is more likely to generate the maximum value for the collection, but will take the longest to effect and is by no means guaranteed.Dealers – Regina is not overly blessed with stamp dealers. At the time of writing (early 2020) there is one shop – Barrie’s on McIntyre Street – that sells stamp collecting supplies, but is mainly dealing in coins. One local dealer – Brian Best – does not have a retail space, but can be contacted at email@example.com He may be able to help.
Finally, there is the Canadian Stamp Dealers Association which lists dealers across Canada. The website lists all current members in good standing and can be found here: https://www.csdaonline.com/
Another option is to attend one of the stamp and coin shows run by the Regina Coin Club (every October and April) and the Regina Philatelic Club (every February). There are numerous dealers visiting Regina for these three events and it may be possible to sell the collection to one there. Watch the local media at these times to confirm dates, times and venues.
Bequeathing a Collection
If you are an enthusiastic stamp collector, perhaps your most important duty is to inspire similar enthusiasm for the hobby with someone in your orbit to whom you can leave your collection. This simplifies the entire question of passing the collection on and minimising the difficulty of disposal for your heirs.
A second option is to appoint a special executor to dispose of the collection on behalf of your heirs. This involves assigning some percentage of whatever the executor can sell the collection for as well as any expenses that might be involved. The benefit of this route is that it removes the burden of disposal from ill-equipped heirs at a reasonable cost. To effect this one needs to identify a willing special executor and insert a clause into your will along this line:
“I appoint__________________ to be my executor with respect to the disposition of my stamp collection and give to him(or her) all my said collection including books, albums and cabinets used in connection therewith. I request that he(or she) arrange for the sale of the said collection on the best terms available and that for his efforts I give to him twenty-five percent (25%) of the net receipts and the remaining seventy-five percent (75%) I direct that he pay to my other executors to become a part of my general estate.”
To ease the difficulty of disposing of a collection, it is enormously beneficial to prepare an inventory of your material. If each stamp is properly identified and an inventory prepared, it simplifies the task of an executor or a general heir in selling the collection. The purchasing dealer or collector will almost certainly be prepared to pay a premium for a collection in such circumstances as it makes breaking the collection down for stock purposes much, much easier.
Finally, an option exists to donate one’s collection to a charitable agency. Oxfam Canada, for example, has a programme of stamp sales and provides a tax receipt that can be of some utility to an heir.
As the above discussion illustrates, the disposal of an inherited collection is not straightforward and there a fair number of complicating factors to take into account. It is hoped that the above information is of some value. If you have any specific question related to the disposal of an inherited collection please leave a message on our website and one of our Club members will do their best to respond.
The above information is provided without prejudice. It is designed to provide anyone with some basic information regarding the disposal of a collection that has been inherited. It is by nature a very high level discussion and is not intended to provide any kind of guarantee or assurance. Due diligence is assumed on the part of a collection’s owner with respect to any disposal decision.