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Revenge of the nerds, as stamp collecting proves more valuable than being cool

Filed under: Investing, Entertainment

If you thought collecting stamps is for kids and nerds, think again.

Apparently they've held their value well during the recession and, especially now that interest rates are stuck at a record low, you could get a bigger return than if you put cash in the bank.

Most stamp collectors spend £200 on new stamps every year. Most will have their own specialisms and interests, and will get as much out of handling and looking at them as they could ever make from an increase in value.

Of course, this isn't a guaranteed investment. The value of stamps is not predictable or reliable. However, if you fancy a bash and you're not into the tweezers and white gloves side of things, you could try a rare stamps index.

For example, the GB30 Rarities Index jumped 39% in 2008, was up just 2% last year and has risen 7% so far this year.

Stamp collecting and autographs firm Stanley Gibbons says the rare stamps index usually goes up by over 10% a year over the long term. "This is a good return when the banks pay you 0.5%," its boss Michael Hall tells me. With interest rates at 0.5%, savings rates have plummeted.

So if you're 30 and you invest £10,000 in British rare stamps you could look forward to cashing in an investment worth over £750,000 if you retire at 65.

Assuming the past continues to be replicated in future (which is always a dangerous assumption).

For those who want to trade their stamps, Stanley Gibbons is going to make its huge unique stamp catalogue - with prices for 700,000 stamps around the world - available online later in the year and will set up an Ebay-style site where people can buy and sell stamps.

You can also invest in autographs of famous people, even going back to Henry VIII. You could get photographs with Michael Jackson's scrawl for £20 before his death but as soon as he died the price shot up to £1,000. So if you can think of someone famous who might pop their clogs soon, get their signature pronto.

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