Collecting banknotes typically comes later in a coin collector's pursuit of his/her hobby. The same can be said for a currency collector who may likely focus on his/her home country first and later broaden his/her horizons with international currency for one reason or another. The other type of collector is the "Globe-Trotter" who visits countries and stashes a few circulated notes as mementos of his/her travels abroad. Recently, Social Media enthusiasts (IG, FB Groups & Reddit) have been getting in on the act by sharing their interest in notaphily. This has raised the profile of world currencies but often with mixed results. Oftentimes, the IG collector with a high volume of traffic becomes an overnight "expert" on a particular nation (or how to source notes). Or, one might see the odd Reddit post on how a collector got all "UNC" notes and sold them for a small (undisclosed) "fortune." Many wild claims & exaggerations dominate the social media domains.
One important factor to acknowledge is that a decent banknote collection shouldn't be just a bunch of used bills stuffed into an envelope or displayed on IG (to garner "likes" &/or a following). Once a collector acquires knowledge of the vast number of nations he/she can focus on, or decides on a MOTIF, he/she soon accepts the fact that several countries must be excluded. The one thing he/she must avoid is to acquire a hoard of notes. Each collector should shape his/her collection according to some kind of GUIDING principles. Since I have joined a few FB Groups (focussed on Canadian or World Paper Money), I have seen countless posts of the unfortunate inheritors of used currency "collections." Sometimes the collections are indeed signature sets &/or various denominations sourced for a particular reason. Often, they were just a hoard of circulated notes tucked away for some obscure reason we'll never know. Sadly, these dirty limp relics seldom elicit collector interest.
Most coin collectors get the significance of collecting sets of coins with a goal (what VARIETY is worth keeping & in what condition?) Whether immediately, or over time, they DISCRIMINATE "it's not how many you keep- but exactly WHAT you collect (in what condition/rarity?) Factors that may weigh in on a coin collector's set will differ from a set of banknotes. Each collector develops his or her own discretion and begins to rule out what he/she won't collect. Will "Collector A" focus on $1, $2 & $5 denominations while "Collector B" seek denominations that are $50 & over? Many more advanced collectors abide by strict defining guidelines (eg: UNC condition only) or may just collect Replacements, Special serial numbers, Errors, or tough signature Change-over prefixes. If you are unfamiliar with these types of notes, see this Notable Terms page.
I have often observed a haphazard "gap-filling by denomination" approach for many hobbyist. I have done it myself. Many people don't care about "varieties" or getting to know each nation's series. After years of searching YouTube, I saw many world collections with the first three to five denominations (& little regard for a note's condition, its serial number, signature variety, etc). For some, this is exactly all they want to acquire & there's nothing wrong with a gap-filling approach (especially keeping notes in UNC condition). But, in the end, you will get less satisfaction from the hobby. I also wish to point out that to collect "1 note from every nation" is such a far-reaching (ambitious) goal that it often leads to frustration, apathy & the collector abandoning his/her pursuit. This is one of the main reasons I would never encourage this avenue. There are countless nations (especially going back in time) with numerous denominations & you'd best register with an online catalogue site like NUMISTA. Remember, setting up reasonable goals is a clever way not to lose interest, not to blow your budget & just enjoy the hobby! Reigning in your scope can actually be very beneficial!
Numista can help you track your progress in whatever area you decide to collect. If you craft a worthy COLLECTOR GOAL with narrow limits, fill that & then create new objectives: this way you will end up learning a great deal more about your particular "speciality." Once each objective is met YOU DECIDE where to your next step goes. This way, you never have to worry about giving up the chase & you keep involved in the hobby!
I've observed that most veteran collectors will have notes with special serial numbers, change-overs, commemoratives, replacements, errors, and other highly desired specimens while less experienced collectors keep 4-5 notes of one denomination & buy only if the note can be sourced cheaply or near Face Value (FV). Remember "you get what you pay for" & if you're primarily driven by economic necessity, then don't expect much. This is one of the reasons that most seniors who hoard older currency seldom chance upon anything tough/valuable (they have not sought what is uncommon but rather just set aside what looked nice, what started to disappear, or was a gifted, or what could be stashed at a particular time). To get more out of this hobby, you must put a little more into it. This may mean getting currency sleeves, an album & a few notes valued above X Dollars.
Research what type of notes most collectors seek. Find the pulse of the hobby - know what collectors seek (their interests/goals) - helps set you apart from the average collector! I'm not encouraging you to be a copycat as there are lots of different items you can collect when delving into WORLD CURRENCY.
Many world collectors acquire notes to fill gaps in terms of the country he/she is missing. Others may focus on countries they have visited, or by specific design (ships, fish, birds, famous inventors, etc). This is often referred to as collecting by motif and is an excellent approach. Each manner in which you decide to shape your collection has worthy objectives so long as you set some limits and consider budget constraints. One thing one mustn't do is collect only what's cheap (or keep circulated notes in an envelope for "old times sake)." I have done this myself- so I am not judging those who have adopted a globe trotter's approach: it is more common than we realize.
I do, however, encourage collectors to avoid hoarding simply because one can! I am very certain that one must at least set a few guideposts to follow so he/she establish, early on, what he/she will not collect (& then to stick to that). The best collections I have seen are LESS (not more)! They have turned their hoards into better notes. They have "turned a corner" in other words.
After I started frugally acquiring lower denominations of nations I visited, I felt I only got it half-right. And "half-right" might as well be half-wrong. Recently, I have made major adjustments to my "scope & focus." I now lean towards errors, replacements, lower numbers or shorter runs. While these collectible notes have cost a little more I feel that they'll always be desirable (& retain/or increase Book Value (BV). My journey has brought me to this one conclusion: I will acquire high grade banknotes which I feel will be treasured for years to come. I have often switched sellers b/c notes described as UNC were AU.
In addition, I only want specific notes which I predict will have a large enough market/fan base to be able to sell in the future. I have often researched the countries I'm interested in so while this may sound shallow/materialistic please note that I usually dig a bit (research) before I buy. For me, that's part of the fun of this hobby & I can spend hours snooping around the net! Unfortunately, my scope has expanded since collecting world but usually I have laser focus (specific denominations, serial numbers, series, etc) once I decide to acquire.
This means: there are hundreds of countries (& certain notes sold in lots) that I will pass on. It also means that the notes I want are the notes everybody wants so they can be more pricey but they usually have much more potential to increase in Book Value (BV). If there is one bottom line to all this, I still feel that we all should have a set budget and be prudent with what we choose to acquire (draw some lines in the sand). I have often acquired extras with the intent to swap (or sell) down the road. If you choose this approach (buy lots or more than one) be sure that you only settle on top grade!
Even if you're not keen on setting goals & narrowing your scope of what you wish to acquire, I suggest you at least set some firm boundaries in terms of what will NEVER be seen in your collection!
I have eliminated several countries for a number of logical reasons & the one most pressing condition is: Lack of a substantial collector base. If the nation doesn't have a large following I won't be interested in it.
I have also eliminated specimens, printer's proofs and hyperinflation notes.* I will never buy a bundle (100) and avoid unreleased, home "test" & special "specimens" which suggest a niche market. Lastly, I suggest "if it looks too good to be true - it probably is" so I avoid bulk bargains (but will buy up to 10 of nations I want if I believe that the extras will sell or swap). I do love to buy sets of early prefixes, special numbers & pay a little more. I have a lot of confidence that these notes will sell down the road.
(* I realize that there are some scarcer 1923 500,000 & 1,000,000 Hungarian Korona banknotes, and other examples, that command high BV but I will pass on these too, as I wish to adhere to my guidelines). I also, on occasion, break my "no hyperinflation" rule when collecting by motif & the note is a special number, replacement or error.
I have been zeroing in on older Commonwealth nations & island states for their intricate designs, limited quantities, or collectible serial numbers/signature combinations. There are many countries which have a collector "fan base" (for lack of a better term) and these countries will usually remain popular. Notes from popular countries (developed tourist destinations, countries who've experienced regime/name changes, etc) will usually have brisk trade & might be tough to acquire at a good price. The majority of the notes I am interested in are not that expensive (less than $100 USD each). If you are curious in learning what I believe will always hold traction for currency enthusiasts, then see my Collector's Corner & Money Market pages for updated observations. Watch the Notaphilyc Culture videos on that page. Video Three & Four delve further into what nations to collect. Number five is on banknote grading basics.
First off, I think it is very important that a collector becomes realistic (& skeptical) about terms like Book Value (BV), Fair Market Value (FMV) and market value (what you actually paid or believe what you can sell the note for). These terms are liberally confused, mixed up or perceived differently from collector to collector. If you doubt this, just ask any dealer of coins and paper money and I am certain they will set you straight! Or peruse one of the many forums suggested in the Notaphilyc Sites to see how one member will suggest a ragged $100 CDN note is worth a little over Face Value, while the OP paid $300 and another will suggest $600. Imagine, if you will, that you have a solid 6 2017 $1.00 note in about Extra Fine condition. A friend offers you $400 but you are going to drop in on your local coin club & you know they're going to allow members a chance to auction one note. What would you do? I would be willing to bet money that you'd rather wait & see what the auction situation will bear rather than sell the note (unless it was a very good friend & you owed him one!) But I use this anecdote to illustrate one thing: that a catalogue gets its figures from a pricing panel who imagine what the potential price a note commands at auction from an interested buyer (not from a friend).
If you have a tendency to believe your note is worth "X number of dollars" it may be worth your while to review the Noteworthy Terms link. One thing some collectors forget is that each note you acquire should have "eye appeal" in order to attract future buyers. [Many cable home-improvement shows have popped up from this one very simple idea: fix up the exterior/interior of a house so it suddenly has homely eye appeal! They then flip or sell the house at a much higher price than what they paid for it (plus their additional renovations costs). People will always be attracted to homes which exude eye appeal! Unfortunately, you cannot doctor a note to improve its eye appeal so always zero in on "Q" or "Original" notes!] Now imagine what the EF solid 6 2017 $1.00 would fetch if it had a tellers stamp that went across the portrait of George Washington's face!
Often we collectors have a cavalier attitude about the Book Value (BV) of our collections simply because we usually enter this hobby with noble intentions of seeking unique designs, a bit of history, or other whims. Most of us see collecting notes (& coins) as a hobby & not as something with intrinsic value. Coin collectors feel their coins have intrinsic value when the coin has some precious metal content. Later, they realize that this "X" (tough) coin has more collector value because it is hard to acquire in X condition. This is entirely what the banknote game is about: collector value/condition. Is the value of your note because of its crisp uncirculated condition, its limited prefix, its rare signature combination? Is the note valuable because it has a certain degree of notoriety (sexy) like the 1954 Devil's Face series? All collectible banknotes will have some collector value for one reason or another & it is your responsibility to determine why your note is worth X dollars (pounds, yen, euros, etc).
I like to think of myself as the caretaker of my collection. We all know that "you can't take it with you" and whatever you collect - must eventually be sold down the road (whether you're around to witness it or not). So while some may think "it's crass to talk money," when we're talking money, I feel it's paramount to at least set some realistic goal posts, or reference points to establish how rare or collectible a specific note/coin is. That is one of the reasons why a focussed collector will eventually consult his/her reference book.
If you are unfamiliar with the way currency from around the world has been organized by Kraus Publication (KP) Standard Catalog of World Paper Money (SCWPM), then I suggest you either order a digital or a hard copy. You will also hear about a note's P (or Pick) number. It's important for you to start identifying each banknote's P# correctly! Do NOT assume that the seller has identified the correct P# because many do not (& misattribute) which is easy to do at times (especially when the note has No Date ND on it)!
You will find many critics of the SCWPM but I have found my copy critical to helping me familiarize with what to acquire (& to gauge prices). A few years ago, due to mismanagement, K+W, the company that owned Kraus, filed for bankruptcy and the catalog itself has stopped being published. Critics have harped on about incomplete listings, typos or other problems. As you can well imagine, documenting the millions of banknotes published by thousands of countries AND accurately estimating each note's BV is a daunting task. Owen Linzmayer took on this challenge a few years ago and came up with "The Banknote Book." In just a few years, "The Banknote Book" was taken over by GREYSHEET which is now subscription based. And if you really want to get serious about knowing a banknote's Fair Market Value, you can always try (subscribe) to TRACK & PRICE.
Many enterprising individuals have tapped into data provided by eBay thus giving another way to guesstimate a note's Fair Market Value. Check the Reference section of my Notaphilyc Sites link because many sites will give you a better idea of what a specific note is selling for (which can differ dramatically from BV or FMV).
Be aware that sellers can ask anything they want using Buy It Now (BIN) on eBay (or ask exorbitant prices online). BIN prices can be either inflated (no connection to BV) or very fair. Generally, they are definitely not FMV & sometimes catalogue prices have been inflated too. It is always a good idea to get a 2nd opinion if you're unsure. I do believe that one of the perks of joining a forum, is that you can always ask others what they think. You might wish to make contacts & shop from other collectors who rather sell to someone they know rather than a stranger (& at a discount since they don't have to pay a listing fee).
Please visit my WORLD LIST of Notes Available if you are interested in purchasing some of my doubles. Remember, I am NOT a dealer. I simply collect a few extras, swap or sell them if I can. Most of my notes will be less than what you will find on eBay (but UNC unless I have described them as another grade). And you pay the actual postage & no tax! I always hope to reach a "win-win" transaction so you enjoy your purchase & we both keep in touch. I am committed to your satisfaction & keeping the hobby healthy one note at a time.
Check my Bank of Canada list of notes available!
Remember to bookmark my Collector's Corner page
Here is Steve Feltner's excellent perspective on collecting WORLD BANKNOTES. Please check it out!