Before You Buy That Collectible .(.(.
-- Exercise caution when speculating on collectibles. Retail dealers will sell at market price, but buy collectibles back at a fraction of what the market says they're worth, said Michael Walther of Oak Wealth Advisors.
-- Insurance and storage costs for collectibles can eat at investment gains, so consider them before buying, Walther said.
-- Don't buy into collectible markets all at once, advised Marc Henn of Harvest Financial Advisors. Unlike stocks, guitars are not traded and scrutinized on a public exchange, so true valuations may be hard to come by.
-- Don't buy collectibles with money you may need on short notice. A guitar, for example, can be difficult to unload quickly at a fair price, Henn said.
-- Avoid pumping money into popular collectibles, financial advisers say. Everybody else probably already has, inflating the price.
-- Buy collectibles you'll enjoy looking at (art) or playing with (guitars), and make investment returns secondary, the experts say. Enjoyment can make wild price fluctuations, even big losses, bearable.