If you happen to be new to coin collecting, welcome to a world that has its own language. Before a new collector can begin to focus on coin values or hunt for rare coins Grand Rapids may be hiding, the collector needs to know some basic numismatic terms.
I addressed important concepts about a coin's appearance, condition, rarity, and ultimately, the value in another blog, "Characteristics of Rare, Collectible, and Valuable Coins" on August 9, 2012. Now let's talk about "Type" coins, commemoratives and proofs, and varieties and errors. Because each of these categories is heavily influenced by Mint marks, and rarity and condition, I have also touched on these here.
This is the basic language—the most common terminology--you'll need to know. However, as you gain knowledge, you may find that the desire for more information leads to a far more extensive vocabulary. It's all part of the process of becoming an avid coin collector. Let's start with the basics and keep the focus on US coinage:
The United States of America began minting coins in 1793 with the issuance of 11,178 copper one cent coins. In subsequent years the Mint issued half cents, dimes, quarters, halves, silver dollars, and gold coins. Many years later, it added half dimes, nickels, two cent pieces, three cent coins and 20 cent coins.
The design of these coins changed periodically over the years as directed by the Director of the US Mint. Each different denomination in each design is referred to a "type" coin. A Morgan Dollar issued between 1878-1921 is a type… a Peace dollar issued between 1921-1935 is another type. Many collectors will seek subcategories for type coins as well, reflecting minor design changes and/or different mint marks.
Commemorative and Proof Coins
While most coins are minted as "business strikes" intended for circulation as a tool of commerce, commemorative coins and proof coins are designed and minted specifically for the collector.
Commemorative coins are official US Mint issues commemorating a special event, person or important memory in our history. The first commemorative coin was the Columbian half dollar struck in 1892 for the Columbian Exposition in Chicago.
Proof coins are struck by the Mint with special preparation and handling with intent to produce a particularly attractive coin. The dies are specially prepared to include fine details and the planchets are often highly polished to give the coin a mirror-like surface. While some proofs and commemorative coins can be quite valuable, many have a surprisingly modest collector value. The reason is they are often readily available in pristine condition. Many proof and commemorative coins, particularly those issued 1955 and later, were issued in large quantities for collectors, and are therefore quite common.
Varieties and Errors
Many collectors are "treasure hunters" seeking rare die varieties and error coins.
Die varieties are coins made with a working die (often 20,000-100,000 coins are made with each working die) having a noticeable flaw. That flaw might make those coins highly desirable and valuable. Perhaps the most famous variety is the 1955 Doubled Die Lincoln Cent. The die was struck a second time with a significant rotation from the first strike and the result was a die that produced thousands of Cents that appear to be double struck. These coins are worth a minimum of $800 even in heavily circulated condition!!
Errors are Mint accidents, usually unique coins that are damaged in the minting process and yet still issued into circulation. Depending on the type of error, these can also be quite valuable.
Mint Marks on Coins
A mint mark is a letter included in the design of a coin that references the city in which the Mint producing the coin is located. The very first coins were minted in Philadelphia but because this was the only US mint at the time, the Philadelphia coins did not have a mint mark. In later years, the US Mint began to produce coins in Mints established in other cities across the country, and began the practice of including mint marks on those coins. US coins can be found with mint marks from Denver (D), San Francisco (S), New Orleans (O), Charlotte (C – gold only), Dahlonega (D – gold only), Carson City(CC), and West Point (W). In recent years the Philadelphia Mint also began to include a mint mark (P).
Rarity and Condition
Some coins are simply very rare, and therefore quite valuable. An 1893 Morgan Dollar minted in San Francisco (1893-S) is the rarest of the Morgan Dollar series. Even one in poor condition is worth nearly $2,000. Most series have one or more rare dates. Rare date Lincoln Cents include the 1909-S, 1914-D, 1922, and others. The 1916-D Mercury dime is quite rare. You can pick up coin values books or search coin values online and easily identify the rare date coins, and then enjoy the search for rare coins Grand Rapids may have in coin shops, shows, and other sources.
Condition is a major factor in a coin's value. A coin's grade is based upon its condition, with grades ranging from 1-70. Grades up to 60 are for circulated coins; Mint State grades 61-70 are for Uncirculated coins.
I mentioned that the 1893-S Morgan is worth $2,000 even in poor condition -- however, an uncirculated example is worth minimum of $100,000 and possibly as much as $1,000,000. Gem Uncirculated (MS65) examples of relatively common date coins can be worth significant premiums.
IMPORTANT! The first rule of coin collecting, NEVER CLEAN A COIN! Cleaning a coin will damage its value even in heavily circulated condition.
Coin Features and Nomenclature
Coin terminology can be daunting, but once you start speaking the language, it comes rather easily. The PCGS (Profession Coin Grading Service) website offers a section called "Lingo" which is a terrific resource to help everyone from novice to expert. It's easy to use and truly one of the best resources on the web. http://www.pcgs.com/Lingo/
Numismaster.com has an extensive "glossary" of coin terms: http://www.numismaster.com/ta/inside_numis.jsp?page=Glossary.
The US Mint also has a user-friendly educational website, which provides a good summary of the history of US coins and other worthwhile coin facts: http://www.usmint.gov/
There are also many online forums dedicated to talking about coins. I use forums at Coincommunity.com and PCGS.com every day.
Internet search engines will help you find nearly anything you want to know about any type of coin.
Finally, we invite you to subscribe to the Mullen Coins blog for regular updates on coin collecting topics.
With the terminology contained in this article, you can begin to understand what makes a coin valuable. Coin values are determined by rarity, condition, appearance, composition, and collector demand (see my blog "Characteristics of Rare, Collectible, and Valuable Coins" of August 9, 2012). When you additionally understand the differences in Types, Commemoratives and Proofs, and varieties and errors, your level of numismatic understanding will make a quantum leap! Take advantage of all the resources at your fingertips to help you make better coin-buying decisions, and to have more fun as a numismatist!!