Certain collections could be worth a fortune.
Nostalgia is a significant market.
Movies, clothing, and toys from the past often trigger fond childhood memories.
People find both monetary and sentimental value in the items they collect.
According to a recent The Wealth Advisor article titled “Estate Planning for Your Collections May Be a Smart Decision to Make,” failing to consider your collectibles in your estate plan could cost you dearly.
When you think of your assets, you likely first think of your home, your bank accounts, your investments, and your life insurance policies.
Although you cannot ignore these essentials in your estate plan, you should also not overlook collectibles.
If you make collecting a hobby, you likely have sentimental and possibly monetary value associated with your items.
The problem comes when other people do not know what you know.
In fact, you may not even be aware of the value of your collection.
What should you do?
Start by cataloging your collectibles.
You should take photos and create a file indicating the type of collection.
To get an idea of the value of your collections, you can research each item on eBay.
You also should know the grade of your collectibles as these significantly impact the price.
Is your item in pristine condition with the original box?
You will likely get close to the highest price.
Is your item “used” with signs of wear and tear?
This will fetch you a smaller price.
Transferring collectibles to a trust is often possible through the “Schedule A” of the trust.
Other items, like motor vehicles, may have their own title.
These will need to have the title transferred to the trust.
The trust can then maintain and distribute the collectibles, providing greater control over the various collections while avoiding probate.
If you choose to distribute your collections through your last will and testament, you will want to make a specific bequest.
Simply listing your collection “generically” as tangible personal property may lead to inadequate handling of these assets.
If no one in your family wants your collections, you may be able to sell them while you are alive.
After investing the time to research and value your collections, you will likely receive the best price and find a good home for them.
You may even be able to spoil yourself with the proceeds from your collections (on your next collections).
Reference: The Wealth Advisor (Feb. 2, 2021) “Estate Planning for Your Collections May Be a Smart Decision to Make”