What Makes Coins Valuable?

Have you ever wondered what makes coins valuable? We can tell you right now: the answer isn’t always cut and dry. Many contributing factors go into a coin’s value. Just because you saw a coin online that “looks like” yours sell for, perhaps, $10,000 or $20,000, it unfortunately doesn’t mean your coin is worth that much. And sometimes, it may be the case that your specific specimen is worth more.

Why Are Coins Valuable In the First Place?

Coins are currency. They are quite literally money.

When you look back in history, the value of coins generally corresponded to their metallic composition. Whereas now, circulating coins have monetary value solely because the government says so. This is known as fiat money.

Modern bullion coins and old gold and silver coins are valuable by virtue of their precious metal content. They are worth more—usually much more!—than their legal tender value.

Additionally, some coins may become collectible.

Here's some Factors That Make a Coin Valuable

  • Mintage

One of the most important things in determining the value of a particular coin (down to the date and mintmark) is its mintage. A mintage number represents how many examples of that given issue were originally made at the United States Mint. A lower mintage typically means there more interested collectors than there are coins available.

However, mintage alone isn’t the only quantity-related consideration that factors into the value of a coin. Yes, mintage is important. It gives us a number on how many specimens may exist in the largest possible pool of a certain coin. But too many collectors fixate on mintage numbers alone when they should really be more concerned about a coin’s population estimate.

  • Population Estimates

Population estimates are often expressed as an approximate figure rather than a hard number. It describes how many of that particular coin may exist in all collections, holdings, across the marketplace, and “wild” in circulation.

Why is the population often more important in determining the value of a coin? Well, we know 44.6 million 1921 Morgan dollars were struck at the Philadelphia Mint that year. The reality is that a far lower number of these coins remain today. Losses through theft, fire, burial, and melting have reduced the numbers of available 1921 Morgan dollars to a much smaller total than records show.

  • Demand

A couple dozen of any coin sure sounds pretty rare, doesn’t it? But is it all that rare if only, say, five or ten people want an example of a coin with 20 or 30 survivors?

In the case of the aforementioned 1927-D Saint-Gaudens double eagle, there are many thousands of active collectors who not only want an example of that very coin but are in a good financial position to plunk half a million dollars on such a coin. Conversely, there are many obscure foreign coins that yield only a few dozen survivors. But, because virtually nobody knows about them or collects them, they can be had for a song.

On the other hand, consider the 1909-S VDB Lincoln cent. It is a coin long heralded by collectors and dealers as the ultimate rarity. Yet, hold on a moment there… How many were made? According to U.S. Mint records, the mintage of the 1909-S VDB Lincoln cent is 484,000. And how many survive? Perhaps 50,000—maybe more.

So, how is a coin with a population figure in the tens of thousands considered rare? One must dive a little deeper. It’s all about supply and demand!

The 1909-S VDB Lincoln cent belongs to the most widely collected coin series in the United States—and possibly the world. Only 50,000 specimens of this famous coin are available for the millions of collectors who want and can afford to buy one, so relative rarity ensues.

And, for the 1909-S VDB, it’s more than just a matter of supply and demand. There’s some degree of fame involved, too. The 1909-S VDB penny is one of but a tiny handful of coins that people outside the hobby knows about as a rarity and collectible. The same really can’t be said about the 1927-D Saint-Gaudens $20. Frankly, only a certain segment of collectors knows this gold coin is a rarity. But the 1909-S VDB penny? It’s an iconic coin that even countless non-collectors broadly regard as “the 1909 penny.”