Guitars are bad investment pieces
There are certain things that are worth investing money in; guitars aren't one of them.
Above is a Fender Kurt Cobain Jaguar. If you buy one of these for investment purposes, you're an idiot.
An example of something that would retain its value over time, provided it's properly cared for, is a Rolex Sea-Dweller wristwatch. You drop 9 or 10 grand on one of those, and it will retain its value plus gain value over time. In fact, it's almost a certainty it will because Rolexes are very, very good when acting as investment pieces. The same can be said for other certain wristwatch brands, but Rolex is an easy buy as long as you "keep it steel" (meaning not gold and not two-tone). Heck, even a Rolex Submariner will retain its value. If there is anything you want to dump money into as an investment that's not land, not a property and not a stock option, a wristwatch is actually pretty darned easy choice, provided you go Rolex.
Guitars are bad investment pieces. Really bad. Maybe not as bad as cars (if there were a top 5 "worst investments ever", cars would be in that list), but darned close.
Now to note: It is 100% okay to invest in yourself as player. If you drop 600 bucks on a Standard Strat and play the crap out of that thing, that is absolutely well and good because you're using the guitar for its intended purpose - TO PLAY IT.
But if you buy that guitar to have it do nothing but sit in a case and go unplayed, wow are you stupid. Why? Because there is absolutely no guarantee the guitar will gain value over time or even retain its existing value.
Take the bad investment option I mentioned above, cars. The reason cars are so stupid to invest in is because the depreciation value is so unbelievably high no matter which car you buy. Anyone in America knows that a brand new car with 0 miles on the clock loses 30% of its value the moment its driven off the lot. It doesn't matter if it's a Ford or a Ferrari. The moment you sign that dotted line and drive off the lot, whammo, that car just lost 30%.
Using that same scenario with new guitars, you lose 15% to 20% of its value after 30 days. This means for a brand new American Standard Strat, you lose between $195 to $260 the second the 30-day money back guarantee expires.
Will you ever make your money back? NO! That guitar, should you decide to sell it even just 3 months later, will be sold at a loss and there's not a thing you can do about it. It doesn't matter if it went unplayed, still has all its original stickers and doesn't have a scratch on it, you will lose.
And God help you if you dropped a few thousand on a more expensive guitar. The more you spend, the more you lose.
"How come I see other guitar players touting cheap axes as 'gem' or 'sleeper' guitar investments that I know are garbage from personal experience?"
GREAT QUESTION, and I'll give you a great answer:
To artificially inflate the value so it sells for more later.
I have seen several guitar players on YouTube - crappy ones, mind you - that purposely buy guitars that have no videos about them on the internet. These guys buy cheap guitars knowing they're junk, then record videos saying how great they are so they're #1 in a search result for that crappy axe. What that does is generate interest and, with any luck, inflates the value through good ol' hype. After a little while, they sell that junk guitar for a nice tidy profit.
Guys who do this are after one thing - your money. They're in the business of what's called "flipping" guitars. Buy cheap, hype up the axe, then sell for as high as possible. Happens all the time.
Are there any good investment opportunities with guitars?
There's only one way, and everyone has already beaten you to it:
Parts.
Guitar parts always sell better and faster than fully assembled instruments. An original set of vintage Fender Strat pickups, or knobs, or bridges, or string saddles or necks or whatever is actually much easier to sell than the actual guitar.
Guitar parts guys have been doing this on eBay for years, and in fact it's so profitable that several buy brand new guitars and purposely disassemble them just to "part them out". And oh yeah, they make money - EVEN WITH SQUIER PARTS! It's true.
But as I said above, everyone has beaten you to the punch. Don't get into the guitar parts business because there's a mountain of competition out there, and you will lose.
You want to invest in a thing that will pay you back later? Get a steel Rolex
Just pick a steel model you like. I mentioned the Sea-Dweller and Submariner above. Other models I'd recommend are the DateJust, Explorer, GMT and Daytona. Any one of those will pay you back over time.
Yes, a Rolex will cost you anywhere from $4,000 to even as high as $50,000 or greater, but it does retain and gain value. You can also choose to buy new or used with Rolex. Compared to guitars, it is okay to invest in a used Rolex piece in good condition. True, you have to look for things like over-polishing, re-dials (always avoid re-dials) and so on, but the point is you can get a good piece for a decent price and be comfortable with the purchase, provided it comes with the original box and papers.
Oh, and another thing. Obviously, a Rolex is far easier to store and care for compared to a guitar. Keep it in a safe at home or in a safety deposit box at the bank. If you keep it at home, you may want to get a watch winder so the gears stay moving and don't freeze up.
As for guitar investment pieces, there are none. Oh sure, there are expensive new and vintage guitars out there, to be sure, but they are ALL horrible investment pieces.
Buy a guitar for just one person. You. Don't buy it to keep in a case or hang on a wall just to sell it later. Buy it to play it, scratch it up, beat on it and make beautiful noise with the thing. Investing in a guitar to sell later is just plain stupid; you will lose your shirt.
I don't care if you spend $100 or $10,000 on a guitar as long as you never buy it as an investment piece. Buy it for the love of creating music.
You want an investment piece? Buy a Rolex. You want to make music? Buy a guitar.
Published 2016 Feb 1
