USPS Proposed Stamp Price Increase

As many of you have heard, the United States Post Office is considering a 2 cent stamp increase beginning in January 2011.

I’ve read all the excitement, that we should take advantage of the 44 cent Forever Stamps while we still can, but when it comes down to it, are Forever Stamps great investments? Probably not.

If you could buy 100,000 stamps on December 31st, 2010 sell them all at market price on January 2nd, 2011, you would make a whopping…$2,000. It would be a nice 4.5% investment on your return. That’s pretty amazing. If you could sell them all by June of 2011, you’d still be doing great.

So why aren’t they a great investment? What issues do I see?

First of all, anyone have an extra $44,000 they want to spend on stamps? If you do, let me know. I have a few other investments for you.

Also, when you are ready to sell, do you think anyone would want to buy 100,000 (or even 1,000) stamps the first day the price change goes into effect. So it’s a long term investment. That 4.5% return on your investment will start to drop fast.

How much will they cost to move? Nobody will buy all of them for 46 cents each. Either you’d give them a small discount and lose out on a lot of that “massive” $2,000 profit, or you’ll have to deal with many transactions, costing you both money and time.

If you’ve got $44,000 to invest, you should find something with a higher upside and much less involvement. The goal is to make things simpler! So instead of investing a bunch of money in Forever stamps, spend enough to last 6 months or a year. Instead of trying to strike it rich, focus on saving the time that you usually spend just going to the post office.

Readers, will you be running to the post office to stock up on Forever Stamps??

9 Responses to USPS Proposed Stamp Price Increase

  1. kt- lifedividend says:

    stamps? I really do not see myself getting them. I prefer investments that i do not have to look for safe places to store like art and gold coins and stamps. I prefer something like a business and stocks because you technically do not have to keep them safe. But this reason is subject to change at any time; i haven’t really researched in the potential of these stamps. I would invest in them if they are worth it

  2. I can’t say that I am eager to get into the stamp investment game either. Maybe I’ll stock up on a small amount for myself, but I don’t see buying stamps in order to sell them in my future. Like you said, how many books of stamps do people buy at a time? My guess would be around 1 or 2. If a book is 20 stamps, you’re looking at trying to find up to 5,000 buyers in your example.

  3. We only use about 10 stamps a year, so I buy a pack of 20 and wait until I run out to buy more. We mail packages through USPS, but I use their automated machines for that…

  4. Mysti says:

    I am not going to buy 100,000…but I will buy about 200. That should last us at least until the NEXT increase. As a family, we don’t send out that many bills….maybe 5 a month at most. But holiday cards….that is about 50-60. So 200 will last about a year.

    • Daniel says:

      @Mysti, Come on, you’re already 0.2% of the way there. 200 would get me through the next 5 years I think. I rarely mail letters. Any packages and I’m headed to the post office anyway.

      • Mysti says:

        @Daniel, I will look at the budget again….maybe I can squeeze in another 99,800. And apparently I don’t know how to add. 200 stamps will last 2 years-ish. ;) No wonder I am in debt!

  5. Financial bondage says:

    I use few stamps these days. the more they raise the cost the less I use.

  6. Benjamin Bankruptcy says:

    I think what you’re refering to is the “holding” cost of an investment and the “selling cost”

    You’d need to compare it against the trasactional costs of stock ownership. It’s not free to buy and sell shares.

    Personally I’m amazed that you guys can still USE the stamp after the price has gone up. In Australia, stamps when from 45 c to 50 c, Australia Post release a 5 c stamp so people can use their old stamps

  7. Angel M. says:

    I still see an amazing cost/benefit. USPS will take a letter from my home and deliver it to the farthest reaches of the United States (or overseas military) for 46 cents!

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