Way back in 1985 (I think it was 1985) my husband bought a high-quality commemorative silver coin with numismatic value of $1700. I'll talk about what happened to the $1700 at the end of this blog.
What would that $1,700 be worth today, if we had invested it in the S&P 500 in 1985? According to a chart provided by the NYU Stern Business school, our $1,700, had it been allowed to compound (reinvest all dividends automatically), would have been worth $178,145 by the end of this year.
The chart offered by Stern shows a year by year breakdown. I've looked at other sources that suggest less would have been earned, but still the earnings would have been significantly over $100,000. I've no way of knowing if that's true, but it's obvious the initial investment would be worth a lot.
What if we had put the same money in a house? According to one site, Amortization.org, that money would be worth $5,240 if it had been invested in a home. For my family, a home was a great place to put our money. Our investment all the way back in 1974 grew to 20 times its value by 1923, when we sold that home. Over those years we also had a roof over our heads--a place to live. There were expenses, but basically we lived with a very low rent because we owned our home. So we must add that value to the absolute increase we would have enjoyed.
What about gold? What if we had bought 1 oz. of gold in 1985? What would that be worth today? According to the site Macrotrends, the $1,700 would be worth $24,278.00 today.
How about a bank account? What if we simply put the money in the bank and let the interest reinvest? One site, Measuring Worth, characterizes this as a 'short term investment'. According to this site, in 2024 (the last year offered for growth analysis) our $1,700 would have been worth $5,620.
But wait a minute...those are 1985 dollars. We can't compare the 1985 rate of growth to today unless we consider inflation. How much would inflation have eroded the value of our 1,700 if we did nothing with it? According to the Minneapolis Fed, we would need $5,088 in today's dollars to match the value that $1700 had in 1985.
If we go by the Minneapolis Fed's inflation numbers, a bank investment barely keeps pace with inflation. The other investments beat inflation significantly.
Of course if we had done nothing with the money...stuffed it in our mattress, the original value, because of inflation, would have been dramatically eroded.
Oh, this does get complex, doesn't it?
What we do with our money should be mostly a rational decision, but that is not always the case. People have different comfort levels.
My husband and I are not sophisticated investors. We tend to go with the familiar, with what we know and understand. Except for investing in our home, this has not yielded us the most profitable results over the years. I can see that now. But even knowing what I do, would I do anything different? I'm not sure.
Handling money should be a rational act, but it is not purely that for many of us. So, what about our $1,700 coin? Why did my husband pay so much, what was the strategy?
Sorry about the blurry picture. Can't find the wire to upload my camera's pictures.
To start with, I won't claim the purchase was strategic. My husband loved looking at coins and buying them. He would go around to coin shows and even to auction houses with his friend Myron and my son. It was always an expedition. It was an outing, an exercise in aesthetics, and also an adventure in history. Most of the coins my husband bought were modestly priced. This 1921 commemorative was one of the most expensive.
Another blurry....
$1,700 was a lot of money back then, so of course he hoped he was making a good investment. He always thought he'd put something aside and maybe leave it for our children, a hard asset that would hold value over the years.
My husband was right on several accounts. The coin is beautiful. My son loves the coins he purchased with my husband. Myron is gone, taken out in the first year of the COVID pandemic. Can't look at the coins and not think of Myron. That's the emotional part of the purchase.
My son doesn't want to ever sell any of the coins unless times are really hard. My daughter doesn't feel that way. She wants to know what they are worth. When the time comes that these belong to my children, they'll have to work out this difference in attitude. My husband and I hope we never have to sell them. But who knows?
The question remains, were they a good investment in financial terms? The answer to that has to be, so far, a firm, "No", not if you compare it to other things we might have done with our money.
I looked up the coin's current value. This is tricky, because value is entirely dependent on rating, and on the market. This one was rated choice brilliant uncirculated. The organization that rated it was Stacks Bowers, a very solid rare coin auctioneer in Manhattan.
I checked out recent auctions of this coin. The selling price (list of 50) ranged from a low of $360 in November of 2024 to a high of $7800 in September of 2025. Most auctions for this coin came in at under $1000.
Here is a picture of the jacket the coin came in. You can see we actually paid $,1750 for this. I realize that now as I look at the picture. The 2X2 is important information. Apparently the Alabama 1921 with a 2X2 marking is more rare than one without it. There were 64,038 of the coins printed without the 2X2, 6,006 with it (Wikipedia)
To be sure, these are not good days for coin sales. But, even so, I would say, going by my experience, coin collecting for the average person is more a vanity pursuit than a serious investment.
@azircon, administrator of this blog and a savvy investor, wrote a blog some days ago that seemed to have a good investment strategy, one that even a conservative investor like me could follow. It described consistent investing in an S&P 500 fund. I guess, if I were starting over I might do that. Right now, I'd probably be buying at the top of the market and I certainly don't have the years to watch my money grow. For me, the investment ship has sailed. Do I regret that my husband bought a beautiful 1921 coin? No. Never.
I love that coin.
Thank you for reading my blog. Peace and health to all.
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thanks for this post! It put quite a few things into a new perspective for me.
About investing in the stock market: that's good if you know what you're doing. I gave my money to a big investment firm which put it all into mutual funds. I needed it when everyone else needed it, during a crash, and there was no more in those accounts than I had invested. Yes, it's all nice and high right now, but will it be when you need it? When you've lost your job because of an economic crash, and so have many of the people you know? I just started trying to learn how to trade for myself. So far, I haven't made anything, but I haven't lost anything either. Onward!
I took a lot of money out in cash, so that, should the banks not be able to dispense money or our credit cards stopped working (which seemed quite possible during covid), I would be able to purchase needed supplies. This money can no longer buy as much as it did a few years ago. Can we say it has deflated? The dollar remains strong, so idk what we say that money has done for me since.
When looking at whether or not a house has been a good investment, too many of us don't figure in the fact that we got to live in the property, or use it in some way, which has a value far above the dollar values. Thank you for pointing that out.
Same for the coin. I love that you love it. Priceless!
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Exactly right. Can't put a price on it. Maybe not an investment, but a thing of beauty.
As for the house...yes, an investment and an object of great affection. Owning your own place, not answering to anyone: how do you put a price on that?
Plus, I am a student of history. I think of times when cash lost its value. When it was prudent to own things you could hold onto or sell. Well, that's a house, gold or a coin. Probably foolish, but as I said in the blog, sometimes decisions are emotional.
Exactly. Tangibles. I like those best.
It is true. $1700 put in 1985 and not adding anything at all in S&P500 index fund will be worth $180K plus today.
This is not sophisticated, this is as simple as it gets. Vanguard and Fidelity existed then, and they exist now. Nothing beats the US stock market in the last 100 years. What will happen in the next 100 years I am unsure, as I am told by the top economists of the world that; past performance doesn't guarantee future return.
However, I can assure you that stock market will always.........always outperform precious metal over long term. Unless we go back to the stone age!
Homes often do better over a human lifetime, but they do that because of leverage. You typically buy home with a mortgage, which is typically 5X to 10X leveraged (people often don't realize it!).
Imagine that. I could pay my granddaughter's graduate school tuition. Oh well :)))
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Yeah, I think nowadays coins are not a great investment, people kinda lost interest in numismatics, shops are closing, even 100 year old coins unless really rare have no value, i have some coins back from fascism period, and they are worth nothing... basically you buy the metal rather than the coin... Your son and daughter will just share in half and then any of them decides what to do with their part, I guess
I still hold out hope for some of the rarer coins. Still, obviously not a good investment. Of course, you always hope somehow you got that one coin, that one gem that is worth a fortune :)))
I think I'm going to try and evaluate whatever hard assets I have so that they can divvy up the stuff before my husband and I check out. Let them agree on it in advance then there will be no arguments. I just hate it when people argue over legacy items.
i think the real estate is a sure bet.. stock are, IMO, never certain. one could lose it all, but a house u live in is something needed and useful no matter what.