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Have you ever considered what kind of assets you could probably pass to your next generation, or even the generation after next, like your grandchildren? Money, jewelry, shares, gold bars or insurance sum-assured? Yes, these are the possible options. I think there is another option you may consider which is easier to achieve without having to invest a lot of money. The answer is ‘collection of old bank notes and coins’.

You don’t really need to spend plenty of your time to manage your wealth like shares because old bank notes and coins can be effortlessly gleaned from time to time. What you have to do is only saving a small amount of bank notes and coins that you have at your particular period of time. For instance, keeping 1 or 2 pieces bank notes and coins of different figures. For the cheaper bank notes like 1, 5 or 10 dollars, you can probably collect more of them. Subsequently, store them nicely in your album, thus you can transfer them to your future generation. As simple as that!

The main benefit of this asset is its high investment value. Before we mention about the return, let’s take inflation into consideration first. For example, the current inflation rate is around 1.9%, while the bank is having a miserable fixed deposit interest rate of 2.75%. In another words, if you keep your money in the bank’s FD, you are making an estimated return of 0.85% (2.75%-1.90%) only. If you want to maintain the return of 2.75% of the current amount you deposit in the bank, most likely you may need to look for an investment tool that can bring you approximately 4.65% (2.75%+1.9%) return in order to fight against the terrible inflation rate.

Recently, I have adopted a slight interest on the collection of old bank notes and coins. I find out the collection can eventually turn into a big fortune in the future for our next generation. Let me quote a simple example, few months ago, I saw a 10 Malaysian dollar bank note (currently known as 10 Ringgit Malaysia) issued in 1967 with the old Malaysian spelling ‘Sapuloh’ (ten) was sold at the price of 180 Ringgit Malaysia, which is 1800% higher than the original value. This particular type of 10 Malaysian dollar bank note that I am referring was commonly used during the 1970s. The spelling of ‘Sapuloh’ was the older version compared to ‘Sepuluh’, which was a later Malaysian spelling. Due to this reason, the ‘Sapuloh’ bank note is more expensive than the ‘Sepuluh’ bank note in the current collectors’ market.

According to my mum, a bowl of noodle that was sold at the hawker stall at that period was around 80 cents. Now normal noodle sold at the hawker stall is around RM3.50 per bowl (RM stands for Ringgit Malaysia). The inflation is around 400% over the 35-year period. If we conservatively assume the ‘Sapuloh’ bank note only increases 1000% of its original value. After deducting the spiraling inflation rate of 400% over the 35 years, we still make a profit of 600%.

Of course there are definitely some pros and cons in everything we choose.  The disadvantage of the old notes collection is, these notes cannot be liquidated as fast as gold, because only collectors are our targeted selling market. On the contrary, collecting bank notes from time to time is much more affordable than keeping gold bars.

Sometimes you may be surprised that some seemingly low-value bank notes are worth unexpectedly high in price after certain period of time. For example, in 1980s, the five ringgit bank note with a flag pole at the reverse side was wrongly printed with a horizontal pole in the mid, eventually formed a cross shape. In 1986, this 5 ringgit bank note had been redesigned due to some religious issues triggered by some Malaysians.  After that, this type of bank note had been replaced with a new design without a cross shaped flag pole on it. Recently, I saw someone selling this type of note at RM40, which is 800% higher than the original value.

Have you ever thought a RM1 bank note is worth more than a thousand Malaysian dollars? Out of all the new version of RM1 bank notes, the 3rd version of RM1 bank note signed by Tan Sri Dato’ Seri Ali Abul Hassan Bin Sulaiman is the most expensive RM1 note at the current market. Some collectors are willing to buy it with more than 1 thousand dollars. This type of RM1 bank note is unique due to the signature of the Immediate Past Governor Tan Sri Dato’ Seri Ali Abul Hassan bin Sulaiman with the prefix CR, while  the current RM1 bank note that you are using, carries the signature of Tan Sri Dato’ Sri Dr. Zeti Akhtar Aziz. What is so valuable about the past governor’s signature? Seriously I don’t know.

So, don’t belittle all these simple looking and commonly used bank notes, one day your children or grandchildren may be amazed with the enormous fortune you leave for them, even though what you give them may just be the 1 dollar bank notes. I got the ‘Sapuloh’ bank note (as mentioned above) from my mum recently. I was surprised to discover that my mum owns this note. She told me she kept it when she was around 20s. She was intrigued to know that her collection is worth much higher than the original value after so many years. Anyway, I got it for free instead of RM180. Hehe…

You don’t have to be a very rich man to adopt this hobby. Of course, the value of the old bank notes and coins fade away without your further action of selling them. A simple tip for you before I end my sharing:  try not to fold your bank notes. The unfolded bank notes are more valuable than the folded one. Is this the best asset for your future generation? You are the only one who can decide the answer.