Monday, September 17, 2012

Quick Guide to Currency Collecting

I started collecting with a single purchase back in 1997 yet little did I realize how fun, frustrating, consuming and rewarding collecting would be. Today, as a more serious collector, I am working on building a large collection encompassing every country that has existed since 1960 including many "national" collections that have several notes from the selected countries dating back to the 1800s.

Coin collecting is America’s most popular hobby and although numismatics includes paper money when it comes to collecting cash it’s pretty hard to find out how to do it or where to start. Books on coins are everywhere and the most important ones are less than $20. Books dealing with foreign currency on the other hand are few, expensive and heavy. Of course it’s understandable that they’d be pricey and large, there are 200 or so countries, but not everyone is out to build a collection like mine. To be honest, while I know they exist I’ve never found another person who has a collection like mine.
The first thing you need to do is figure out what kind of collection you want. Do you want a European one, nations of the Christian/Muslim world, WWII countries, pre-WWII notes, modern, notes with animals or famous people, or one that contains all of the notes of a specific country? Once you’ve done that it’s really important to have a way to keep them safe.

I use 3-ring notebooks and safe plastic holders that can hold 3 notes each. They’re easy to find, cheap and above all else, safe. It’s incredibly important that what you house your collection in won’t actually harm it in the long-term. Paper envelopes, tape etc can all contain chemicals that will discolor or ruin a collection especially since notes are made of many different materials. Personally, I use BCW Supplies, an online store. But there are many others you can pick from including your local hobby store.

After that I’d recommend buying a used copy of the “Standard Catalog of World Paper Money”. It comes in 2 volumes, Vol. 1 is 1368-1960, Vol. 2 1960-present. There is also a volume of “special issues” but you only need that if you’re interested in banknotes that aren’t commonly issued to the public, special treasury bills etc. Each catalog is around 1,200 pages long but you can usually find a used one on Ebay or for under $40, new ones can cost up to $85. Start with the one that best suits your needs, no reason to buy all 3 if you’re only collecting modern notes.

The reason having the catalog is so important is because it gives you A LOT of information and it has the values of most issues. The first rule in the value of something is this: something is only as valuable as someone is willing to pay, no matter how rare. The book is just a good guideline, you may find things for sale cheaper or more expensive, it just matters how much you want it. Often times you can find notes for sale far below the book price, but, there are times when it will cost more. Having knowledge of similar notes can help you determine if the higher price is really worth it, and at times it is.

A large part of a notes value comes from its condition. A note in “Very Good’ condition may be worth $8 while the same note in “Uncirculated” could be worth $550. Banknote grading guides vary from publisher to publisher but are fairly uniform until the higher grades. Banknotes, like coins, are graded along a 70 point scale; the higher the number the higher the grade. In order to keep your notes protected I recommend that you use white cotton gloves to handle them and to do so gently as to not bend or otherwise damage them. If you don't have cotton gloves make sure your hands have been washed and are free of any dirt, food, sticky substances etc. Having a 10x magnifier is also a good idea so you can inspect the many small details modern notes have and to detect possible errors.
The following guide is a mix of the two most widely used grading scales:
 Fair/Poor 0-3 (Fair or Pr): Heavily soiled, may have multiple tears, holes, faded, difficult to read, little more than a rag. Notes in this condition are worthless except in cases of high rarity. If you can’t find a note in a better condition then they could be used as a “place holder” until you find a better one.

Good 4-7 (G): Very worn, limp, may have small tears or holes, staining etc. There is a difference between a G4 and a G7, less damaged. Most old notes still circulating will be in this condition.

Very Good 8-11 (VG): Well circulated but intact, without large pieces missing. There may be staple holes, light staining, rounded corners, small corner may be missing. Most collectors won’t collect anything in a lesser grade.
Fine 12-19 (F): Circulated, no corners missing, may have folds or creases, not totally limp (or soft), colors are more clear, minor discoloration, rounded corners, pinholes may be present, no tears.

Very Fine 20-29 (VF): Attractive, few folds, creases, note still retains some crispness, small stains or soiling.
Very Fine+ 30-39 (VF+): Colors are bright, less than 5 fold lines, looks similar to an Extremely Fine note but with more folds, a corner may be rounded and other minor differences.

Extremely Fine 40-49 (EF): Less than 3 folds (folds are light), crisp overall, very attractive, clean, all corners are sharp.
About Uncirculated 50-59 (AU): Minor evidence of handling, may have a single fold line either vertical or horizontal, corners sharp, may have a pinhole, no creases, may have minor crimps.

Uncirculated 60-69 (UNC): Never mishandled, 1 minor fold, no staining, clean, firm/crisp paper, corners are square, no edge marks. Lower grads may have printing off center, higher grades more centered.
UNC 70: Perfect, crisp, no marks, folds, stains, holes, perfect registration and 50/50 margins (printing perfectly centered). Very rare.


1. Values will not often be given for notes under VG8 other than their face value or in cases of rarity.
2. Remember, there are differences between each number, the higher the number the better the quality, even 1 less fold or rounded corner can increase the grade by a point.

3. A “crease” is a line, fold or other mark that has “broken” the paper, its feature has gone all the way through and can be seen on the other side of the note, it has broken the crispness of that area. The term “broken” doesn’t mean an actual tear or rip.

4. Pinholes are small holes, usually the size of a sewing pin or staple, which have normally been placed there by the government or bank for various purposes. Other holes may be similar but larger and may represent a cancelled note or specimen. Small pinholes may be acceptable for lower UNC grades. Holes placed there by the government (larger, may spell a word) for specimen notes will also be acceptable for grades under 69.

5. Some folds or creases may be the result of the printing and counting process by the government. These crimps have become more common with the introduction of wide security threads. Notes without these features may command a higher price.
6. For grades Very Fine and higher notes with a higher grade within the main grade (like EF 45) may also be called “Choice EF” or EF+, AU+ etc.

* This grading scale is a combination of the two most commonly used. For more information check out the Paper Money Guaranty or the Standard Catalog grading definitions.
After you have the supplies you need and some basic information the next, and best, step is to start collecting!

Finding different banknotes is much easier to do today than even 10 years ago. Some companies like Littleton Coin offer collecting programs. The benefit of such a program is you get notes every month and can pick which ones you want to buy and which you don’t. The down side is the prices are generally far more than they’re worth and you won’t be able to find older notes.
If you have a coin shop in your town they will likely have paper money as well. Using your local shop is a great way to meet people with similar interests, learn new information and find rare notes or ones in higher conditions. Plus, it’s a wonderful way to help your local economy.

If you don’t have a local shop or you can’t find what you want there you can always use the Internet. Sites like or banknote specific sites will have a wide variety of notes and they’ll usually be at decent prices. Do some searches and find a seller you trust. If they don’t offer returns, ask extremely high prices or don’t answer your questions you will want to find another seller.
Here are some sites you might find useful:

1. American Numismatic Association
2. BCW Supplies
3. Ultra-Pro Products  


5. Heritage Auctions
6. Constellation Numismatic (Error notes)

7.  Ebay

8. Tom Chao (Seller and lots of information)  
9. Page’s Coins and Currency

10. Me, if you can’t find what you’re looking for send me an email at or see my Ebay profile

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