Rolex, Audemars Piguet, Tag Heuer, Vacheron Constantin, and Cartier, these are just a few of the most well known high-end luxury watch brands in the world. Owning a few expensive luxury watches is common amongst most high net worth individuals, but for some collecting multiple rare and/or high-end watches is a hobby or even an investment. According to one expert collector if you’re in to watches there are a few must-have timepieces that should be a part of your collection. His recommendations include, among others:
• Omega Speedmaster
• Rolex Submariner
• Jaeger-LeCoultre Reverso
• Casio G-Shock
• Breguet Type XXI
Investing in Collector Watches
Of course, at GROCO, we do not watch experts and we wouldn’t even attempt to give you advice when it comes to watch collecting. However, we can help you out when it comes to some of the dos and don’ts of collecting watches and other expensive collector’s items, especially the tax implications. Like any kind of collector’s item, the tax implications will depend on how and why you collect and what you end up doing with your collection. Like with any collectible, you must pay taxes on your gains and these gains to fall under the capital gains tax rate. Over the past few decades rare, vintage and high-end watches have seen a big increase in value as more wealthy individuals are putting more of their income into collectibles. Watches have been selling in increasing numbers recently at auction houses all over the world, and for higher prices.
Other Things to Consider
There are some risks to collecting watches, just as there are with any type of collectible. One of the most common risks is ending up with a fake, or with bad advice that a watch will increase in value when in reality it probably won’t. One important thing to always keep in mind, according to one collector is to stick with the big names. You can rarely go wrong with the likes of Rolex, Cartier and Patek. It’s very wise to use an expert when purchasing watches and going through an auction or trade show is also the safest route to go. You should also be aware that not all watches hold their value and when it comes to collecting watches used models are typically more valuable for collectors than new ones.
Appreciation Takes Time
While collecting watches can be lucrative, most watches will not end up with a huge return on your investment. You should also be aware that it takes a lot of time, usually 10 to 20 years, for a watch to start to appreciate in value, so you have to be prepared to be in it for the long haul. However, most collectors will tell you that the real reason you should buy a watch is for your enjoyment of the watch and not for investment purposes. To learn more about the tax implications of collecting watches or other types of collectibles please contact us today.
The post Time to Add These Watches to Your Collection? first appeared on Advisors to the Ultra-Affluent – Groco.
