Doing your research is key to making money in collections, so it's best to pick a subject area that you're interested in or passionate about. Whether it's sports, comic books or music doesn't matter -- just stick to one or two that you can become an expert in. If you're not sure which area to focus on, keep in mind certain collections are safer investments than others.
Currency, for example, is a great investment. You can easily become an expert in currency by accessing the U.S. Mint and other government documents. Supply and demand is easy to establish as currency is created in limited, well-marked batches or mints. With a quick snapshot of the piece and a reference book, you could immediately determine how rare it is, and how much it is worth.
For example, you might discover a coin in a bag of change left to you by a relative. With some simple Internet research, you could discover it is a $2.50 Indian Head coin worth anywhere from $340 to $17,500 [source: PCGS.com]. You might even begin collecting today's currency by simply gathering coins you don't already have. Usually collectors who pick through circulation are looking for coins from each year and each mint. You'll want to have your collection properly stored and insured, but we'll get into that more on the next page.
Sports memorabilia collections are also pretty reliable. If you begin a sports collection, supply and demand is important. The "classics" are important as well -- focus on great legends or firsts in the industry. If you find anything that once belonged to a well-known, and now-deceased, legend like Babe Ruth, it's almost certain to increase in value, as long as it's in good condition and stays that way. Or, if you have a collection of baseball cards from a team's very first season, it will be worth more than those its following seasons. If you know what you're looking for, you can find gems on eBay.com, at local antique shops or even garage sales.
Comic books also make great collections. If you can get your hands on an out-of-print classic Superman or Batman comic, you can certainly find a passionate fan to make your investment worthwhile. In February 2010, a mint condition and very rare copy of a Batman comic from 1939 sold for $1,075,500 [source: Censky]. Just a month later, though, a copy of Action Comics Superman No. 1 from 1938 sold for a record $1.5 million on the online auction site ComicConnect.com [source: CNN.com]. Of course not all comics are going to be worth that much. Condition and rarity affect the value, and first appearances of popular characters -- like the Superman No. 1 comic -- are also more valuable. Often it's these rare comics that are hidden away for years, so keep your eyes open when you're on the hunt because you never know when may run across one. The Superman No. 1 comic that fetched $1.5 million was tucked inside a movie magazine for more than 50 years [source: CNN.com].
So now you know a few worthwhile collections, but how can you actually make them pay?