We’ve all known someone who became an uber collector and went over the edge. Soon, before the well intentioned person knew it the collection turned from a wise investment to a financial pit and an then a painful obsession.
I have to admit I had my own select tiny obsession when my daughter was young and I bought cases of baseball cards that I was convinced would become very valuable in 20 years and help to fund some future necessary expense. After 20 years I sold the cases for $100. Lesson learned.
The Robinson family spent a bit more than I did. A cool $100,000 went into their collection obsession.
When it comes to debt from collecting the key to learn is the spending is never about the thing, but about the thrill of the hunt. Yea, the excitement of the hunt for the collectible is the real brain chemistry charge that becomes the drug.
How many Beanie Babies are we talking about, well 15,000-20,000 or so Beanie Babies comprise the prized Robinson collection. Who knows, maybe the damn things will rise in value to recoup some of the investment. The fear is hanging on to a sinking investment in hopes it will pay off at one point in the future is, well, most often fools gold and just loss aversion.
In economics and decision theory, loss aversion refers to people’s tendency to strongly prefer avoiding losses to acquiring gains. Some studies suggest that losses are twice as powerful, psychologically, as gains.
If there is any lesson to be learned from collecting or investing it is what Neil Patel observes, the real money should be made on the buy, not the sell. See his excellent article 7 Lessons Learned From Losing $739,135 In Bad Investments.
If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.Beanie Baby Budget Buster Begets Bankruptcy by Steve Rhode