Misconceptions and Need-To-Know Information About Collectible Currency
The following information is only meant to be a very brief introduction to a few topics and misconceptions that the novice collector or outside observer sometimes encounter. In addition to reading the information below, you may find our page listing a few Frequently Asked Questions and our page on Common “Old” Currency Values of interest.
Year Printed – Every single note will have at least one year printed on it. That year is known as the series. Generally speaking, the year on a note is the first year that series of note was printed; it is not necessarily the year that individual note entered circulation. A great example of this is the 1935 silver certificate series. These notes were first printed in 1935 and were printed all the way up to 1956. They all say 1935 (sometimes with a letter suffix) but very few of them actually left the printing presses in 1935. The same is true of green seal notes from 1934. These were printed until 1949. Unlike coins, paper money is not so transparent as to when it came off the presses. To get a better idea of actual age take a look at the signatures on the note. These signatures will be of the people who were in office when the note left the presses.
Age – There is a misconception that if a note is very old that it is normal for it to be in terrible condition. The term “great shape for its age” really has no place in the world of collectible currency. Currency is graded purely on condition and age is never factored in. There are literally tens of thousands of notes from the 19th century that are in perfect condition. Furthermore, notes from the 1700s exist in uncirculated condition. On the same point, age does not really affect rarity. There are plenty of notes from 1862 that are much more common than some notes from 1929. Rarity is a factor of number of notes printed and survival rates, not just age.
Condition – We frequently talk to people who are not familiar with the hobby and they don’t know what makes a note qualify as being in uncirculated condition. We have a guide here about the technical grading of paper money, but we wanted to briefly discuss the topic here as well. One description we hear a lot is “everything is readable.” If a note was undecipherable it would not be collectible. Readability has nothing to do with grade. We are well aware that it is very difficult for a novice to analyze the intricacies of paper money grading. However, if describing a note, instead of assigning an arbitrary opinion like “decent” shape or “normal wear” try to take it step further. Consider the number of folds, take a look at the corners, check for pinholes. The more accurately and technically you can describe a note the more seriously you will be taken. If you can describe a note like a professional while you are taking bids for a sale – you will 100% of the time be offered more money. When possible include pictures.
Storage – A lot of times people will describe a note like this: the note is from 1929 it is in great condition, we have kept it in a book for 30 years. While 30 years in a book will certainly flatten a note (which is frowned upon) it in no way improves the quality. Having spent 30 years well protected in a safe deposit box will not make up for the notes first 50 years of circulation. We suggest keeping notes in a Mylar plastic sleeve in a temperature controlled environment. When describing a note, focus less on the note’s history with you as an owner and focus more on actually condition.
Price Appreciation – We get emails and phone calls from thousands of people each year looking to find out what their note is worth. Sadly, at least 80% of the time the note is really just worth face value or 50% over. When we relay this information to the owner, generally they are surprised at the small premium. Many people assume that if the note is held for a few more years it will appreciate in price or become rarer. There is only one ultimate truth in currency collecting: Your note will never be any rarer than it is today.
At a certain point a note reaches the level where its collector value is higher than its face value. Once this is established it is very unlikely the note will ever be spent. However, this also means that for the rest of history anytime someone sees such a note and realizes it is worth more than face value he or she won’t spend it and instead it will just increase the supply available to collectors. Many notes including modern small size silver certificates and 1953 and 1963 red seal legal tenders are in this category. They are worth more than face value, but not by much. Rather than saving these and hoping for the best – sell them for a premium today and take the proceeds and buy a real investment.
Reserve Banks – All notes that are either Federal Reserve Notes or Federal Reserve Bank Notes will have a denotation on them as to which bank issued them:
A – 1 – Boston
B – 2 – New York City
C – 3 – Philadelphia
D – 4 – Cleveland
E – 5 – Richmond
6 – F – Atlanta
7 – G – Chicago
8 – H – St. Louis
9 – I – Minneapolis
10 – J – Kansas City
11 – K – Dallas
12 – L – San Francisco
The currency was not printed in these towns, but rather it was printed in Washington DC for these Federal Reserve banks. In the coin collecting world people tend to associate mints with rarity. This leads people to believe the San Francisco Federal Reserve Bank has something to do with the San Francisco mint. The two are not related. The issuing bank does tend to affect rarity on the 1928 and 1929 green and brown seal notes. Chicago and New York are almost always the most common and worth the least. The other banks have differing rarities. If you have a note from the 1928, 1929, or 1934 series you’d like to know more about, please contact us.