Many people talk about valuable coins… But have you ever wondered what makes a coin valuable in the first place?
What if I told you it’s not just a matter of how old the coin is?
That’s right… Just because a coin is old doesn’t mean it’s valuable!
Let’s go over the 5 key factors that are used to determine the value of every U.S. coin.
#1 – The Coin’s Bullion Value (Metal Value)
Virtually all United States coins are made from metal. I make this point because some World War II-era pattern coins that were never struck for circulation were made from glass, plastic, and other materials to save metal for the war effort.
The metal used to strike coins generally has an intrinsic value. That is, the metal is worth something itself. It’s certainly the case with so many U.S. coins, which are made from copper, nickel, gold, silver, platinum, and combinations of these and other metals that are worth money on their own.
The bullion value of a coin is often the driver of a coin’s value. From the practical standpoint (notwithstanding face value or denomination), a coin will essentially never be worth less than its metal value.
Bullion value is a major component behind the desirability of these coins:
- Old copper pennies
- Pre-1965 90% silver coins (dimes, quarters, and half dollars)
- Silver dollars
- Pre-1933 gold coins
- Bullion coins
- And many other pieces that contain precious metal
#2 – The Coin’s Rarity (How Many Still Exist)
The number of specimens available of a certain coin greatly dictates (though not entirely, as we’ll see later) how much a coin is worth.
One of the primary ways to determine how rare a coin is would be to look up its mintage (aka “the number of coins struck by the Mint”). For U.S. coins, this information is widely available to the public. Generally speaking, the lower a coin’s mintage, the rarer it is.
However, it seems a lot of people fixate only on the mintage of a coin and think this translates to how many specimens of a given coin exist! This is not the case at all. In many cases, coins are melted in great quantities — either due to bullion prices, or orders by the government to destroy a certain number of coins.
Therefore, in figuring out how rare (or common) a coin really is, you must look at not just a coin’s mintage but also its estimated number of survivors or population. (The latter two are not the same.)
Let’s break this down in greater detail, so the terms are clearer:
- Mintage — The official reported number of examples struck for a given issue of a coin. While low mintage figures generally translate to greater rarity for a coin, there are some instances in which a coin is much rarer than its mintage might suggest. An example of this is the extremely rare 1933 Saint-Gaudens double eagle, which saw a relatively high mintage figure of 445,000 struck by the Philadelphia Mint. Yet a 1933 law required all of the 1933 double eagle gold coins to be melted. Only a handful are known to remain, and just one is legal to own. It last sold for nearly $20 million in 2021!
- Estimated survivors — An academic estimation of how many total examples of a given coin are left. This information provides some idea as to the likely remaining number in the whole world. In most cases, population data is compiled by third-party coin-grading services, which regularly handle a large number of both rare and common coins.
- Population — A hard figure of exactly how many examples of a coin have been officially accounted for by professional numismatists. Keep in mind… a low population does not always mean a coin is rare. For example, many common, low-cost coins (like old Lincoln Wheat pennies) have low population figures simply because few collectors submit these coins to third-party coin graders for grading and encapsulation. But these low populations do not translate to greater rarity.
TIP: It’s good to know the difference between rare coins and scarce coins.
#3 – Demand For The Coin (Its Popularity)
Rarity takes into account the number of coins struck versus how many are still available. But rarity in itself does not factor into the whole of a coin’s value.
It’s also about demand — the coin’s popularity.
For example, one of the most valuable rare coins of the 20th century is the 1909-S VDB Lincoln penny, which has a mintage of 484,000 and about 50,000 estimated survivors. This rarity, belonging to one of the most widely collected coin series around (the Lincoln cent) is worth many hundreds of dollars even in well-worn condition.
But there are many coins that have far smaller mintages, yet they are worth only a fraction of the 1909-S VDB penny value.
For example, the 1844-O Liberty Seated half dime has a mintage of just 220,000 and, according to Professional Coin Grading Service, only 300 are estimated to survive. Yet, a rare coin of such meager survival numbers can be had for as little as $300 — less than half the baseline price for a 1909-S VDB penny.
Why is the coin that is so much rarer (and older) worth less than the 1909-S VDB penny?
Because virtually millions of people collect Lincoln pennies, with a great many of these folks vying for a 1909-S VDB penny to help complete their collections.
On the other hand, relatively few people collect Liberty Seated half dimes by date and mint — thus, there is far less demand for the 1844-O half dime.
Read about condition rarities vs. absolute rarities.
#4 – Errors Or Varieties On The Coin (Oddities)
Oddities on coins surely bring attention.
Most times, weird-looking things on coins are either post-mint damage or alterations made after the coin left the mint. These problems generally detract from the value of a coin.
However, true errors and varieties are not only scarce, but they also are frequently quite valuable!
The difference between a variety and an error is how the mistake (or odd distinction) on the coin was created:
- A coin variety results when lots of coins in a row were struck incorrectly due to the die itself striking every coin the same way on the coin press. Varieties are oddities that were caused by mechanical mistakes at the U.S. Mint — and they were replicated many (even thousands!) of times.
Some examples of varieties include doubled dies, overdates, and repunched mintmarks. One of the most valuable varieties of all time is the 1955 doubled die penny, which is worth well over $1,000.
- A coin error results when just one, two, or a few coins were struck incorrectly due to some mishap that took place at that exact moment on the coin press. Errors include major and minor oddities that were caused by human OR mechanical mistakes at the U.S. Mint — they entered circulation that way and are relatively few in number.
Sometimes errors and varieties slip through the cracks and escape the mint on accident. Other times, they are intentionally released by the U.S. Mint.
#5 – Condition (Or Grade) Of The Coin
Another factor that goes into a coin’s value is its condition.
Ordinarily, the better preserved a coin is, the more it is worth — regardless of how common the coin is, the presence or absence of errors, or any other considerations.
Some coins are rare because of their grade (their state of preservation). These pieces, known as conditional rarities, might be common in terms of mintage but offer only a few known examples in the very best condition — thus, those high-end examples are rare due only to their grade.
Even modern coins can be conditional rarities — as is often the case with so-called super-grade coins grading Mint State-69 or Mint State-70.
How to Grade Coins Yourself
Grab a coin magnifier and a copy of the U.S. Coin Grading Standards book. Then, watch this video to see how to grade coins yourself at home:
These are the best coin grading apps that will make grading coins yourself much easier.
The Bottom Line
So to summarize…
Let’s say you have two different U.S. coins.
The things that would make one coin more valuable than the other are (in this order):
- Bullion value (containing precious metal)
- Rarity (having fewer examples still in existence)
- Demand (being popular among collectors)
- Errors (having mint-made oddities)
- Condition (the degree of wear present)
It’s important to take all of those things into consideration when determining the value of a specific coin! That’s what I do.
THE NEXT STEP: Ready to find the value of your own coins? Start here.
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