Pawn shop customers are more knowledgeable than they used to be. They’ll take a closer look at that coin before they drop it into a vending machine or that jar tucked into the back of a kitchen cabinet. Maybe that penny feels a little heavier, or they don’t recognize the face on that silver dollar. They realize they might be holding a rare coin that’s worth a lot more than the amount stamped on it, and they’ll bring it to you.
Even if you already have some experience with buying and selling coins, it’s important to know how to accurately grade and authenticate coins. You’ll be able to set fair and accurate prices for buyers and sellers by knowing how to disclose a coin’s defects, and you’ll be equipped to get the best price for coins you’re looking to sell.
Coin Authentication
Wait a second—is that 1911 Indian Head $2.5 coin really a 1911 Indian Head $2.5 coin? (Yes, there was a time that the US minted coins worth two and a half dollars.) Before we can examine the condition of the coin and assign it a value, we have to first determine that the coin in question is authentic.
When you work with an authentication service, experts will examine your coin in a variety of ways to determine its authenticity:
- Physical: Evaluating weight and diameter
- Microscopic: Searching for minute alterations
- Chemical: Analyzing the chemical composition of the metal
- Historical: Comparing the coin against historical records
Coin Grading
Different coin associations have different grading scales, but in the United States, the most commonly used scale is the Sheldon scale. This scale grades coins from 1-70 along with a descriptor. The lowest grade is Poor 1, given to coins that, well, barely resemble a coin anymore, they’ve been so worn down by circulation or by being at the bottom of a 5-gallon water cooler jug full of pennies for 30 years. Coins that look as pristine as the day they were minted, on the other hand, are called Mint State and given a grade between 60 and 70. These coins likely never paid for a game of Pac-Man in 1982 or rolled around a dryer after being left in a pocket—they were likely never in circulation at all.
Coins are assigned their 1-70 grade based on the presence or absence of the following details:
- Dents
- Scratches
- Rust or tarnish
- Luster (how brightly the coin shines)
- Worn-out details (i.e. facial features worn down or letters no longer legible)
While the American Numismatic Association offers lots of guidance on grading your coins, there is still a degree of subjectivity involved if you don’t have much experience. You can have coins professionally graded, but if you’re grading coins yourself, it might be best to err on the side of a lower grade. It’s better to protect your reputation as an honest merchant than to try to bump up a coin’s grade by a point or two by failing to disclose a minor scratch. Working with a professional, however, can remove that guesswork and provide as objective a grade as possible.
There are plenty of resources online to help you grade your rare and collectible coins, but nothing beats the trained eye of a professional, especially when it comes to authentication. Visit the Coin Gallery.
