Taking money out of retirement funds to purchase cards

[G1911]

Draining retirement accounts to do it doesn’t sound like diversification but going all in on the current fad.

Although, I have been reliably informed by people who put too much of their money into cards that the only direction for baseball cards is up, and Mickey Mantle is the safest investment that can be made. Empty your retirement accounts, sell your house, and put all in on mass produced cardboard pictures. Be a visionary and print that money #investemoji

[Peter_Spaeth]

Originally Posted by G1911

Draining retirement accounts to do it doesn’t sound like diversification but going all in on the current fad.

Although, I have been reliably informed by people who put too much of their money into cards that the only direction for baseball cards is up, and Mickey Mantle is the safest investment that can be made. Empty your retirement accounts, sell your house, and put all in on mass produced cardboard pictures. Be a visionary and print that money #investemoji

I wouldn't advocate draining retirement accounts by any means, but it isn't an all or nothing proposition.

[Snapolit1]

Originally Posted by Peter_Spaeth

I wouldn't advocate draining retirement accounts by any means, but it isn't an all or nothing proposition.

Agree. Any collection worth more than a small amount is diversification of sorts.

I have never specifically taken retirement money to buy hobby stuff and never will.

[Peter_Spaeth]

Originally Posted by Snapolit1

Agree. Any collection worth more than a small amount is diversification of sorts.

I have never specifically taken retirement money to buy hobby stuff and never will.

Right, and any decision to spend more than a small amount on cards, rather than putting it into stocks or other assets, is whether one likes it or not, an investment decision or one with investment implications.

[Johnny630]

Drew, I have heard some of the same things from dealers who set up at the bigger shows with the higher-end vintage names I collect. From what I’ve seen and heard this has been commonplace since around the Start of all these Vaults, especially since March 2020. Idk to each their own I guess.

[raulus]

Originally Posted by Johnny630

Andrew, I have heard some of the same things from dealers who set up at the bigger shows with the higher-end vintage names I collect. From what I’ve seen and heard this has been commonplace since around the Start of all these Vaults, especially since March 2020. Idk to each their own I guess.

And once the cards are in the vault, then you can borrow against them to buy more cards!

So not only have you placed 100% of your assets into cards, you've leveraged up to 160% or more...

[Johnny630]

Originally Posted by raulus

And once the cards are in the vault, then you can borrow against them to buy more cards!

So not only have you placed 100% of your assets into cards, you've leveraged up to 160% or more...

Isn't it wild!! Feels like a very slippery slope to me. Idk thank God we have smart guys with money who love the cards and are keeping this hobby strong many of whom are on this board :-)

[raulus]

I guess maybe they follow Michael Saylor, except instead of Bitcoin, they go with cards:

‘How do I buy more Bitcoin?’ Take all your money. Buy Bitcoin. Then take all your time, figure out how to borrow money to buy more Bitcoin, then take all your time and figure out what you can sell to buy Bitcoin.” - Michael Saylor

[x2drich2000]

I don't think enough info is provided. What type of retirement account are they withdrawing funds from? What are the ages? Withdrawing from a 401k is much different than withdrawing from a Roth IRA same as withdrawing before age 59 1/2 is a lot different than withdrawing after age 59 1/2. That information will have drastically different issues with taxes and penalties on the withdrawal. As I understand the rules, personally I might consider it from a Roth IRA, but wouldn't even think about it from a 401k.

[G1911]

Originally Posted by Peter_Spaeth

I wouldn't advocate draining retirement accounts by any means, but it isn't an all or nothing proposition.

If you’re to the point where you’re taking money out of retirement accounts, and incurring the heavy taxes and fees for doing that early and improperly, I have a hard time seeing how this person isn’t going all in. Once you’ve gone this far, there isn’t much further to go.

I have no problem if people want to invest some money in coins, stamps, crypto, beanie babies or cardboard. It’s riskier, but there’s also a plausible chance they will outperform my index funds. If you’re taking money out of retirement accounts to do it, this person really should hit pause and reflect on what they are doing.

[steve B]

It's not something I would do.

I also wouldn't take on debt to buy collectibles, although I've been told that I won't be a serious collector until I do. That was regarding a stamp that was "needed" to maybe make an exhibit worthy of a top prize. Of course there's only one, and the last sale was 60K, more debt than I'd ever consider for a collectible.