Striking Out on Mark McGwire Cards

Kiplinger's Personal Finance Magazine, Jan, 1999 by Kimberly Lankford, Sean O'Neill

* Big Mac's rookie-season baseball cards are worth only a few bucks.

I just found in my baseball-card collection a Mark McGwire rookie card and a "record breakers" card from 1987. Both were issued by Topps. How much are they worth?

--J.S., Huntington, N.Y.

Not much. Even though Big Mac's 70-homer season has raised the value of McGwire collectibles, the rookie card still retails for only about $6 in near-mint condition, and the recordbreakers card for about $2, says Grant Sandground, senior price editor for Beckett Publications, which issues baseball-card price guides.

The problem: Baseball-card collectors don't consider the 1987 card to be McGwire's rookie card, even though it was issued during his rookie year. Collectors define a player's rookie card as the first one to appear in a nationally a valuable set. McGwire made his major-card debut as a college student, when he appeared on a 1985 Topps card as a member of the 1984 Olympic team.

The retail price for a 1985 McGwire card in near-mint condition spiked from $35 in the spring to $150 in August and $250 in September, says Sandground. In early fall, the same card was retailing for $2,000 to $3,000 if it had been professionally graded as a rare gemmint proof, which means it's perfectly centered with no ink irregularities or wear. Sandground expects prices to stay high until someone breaks McGwire's record, which could be a long time. "This is going to become a part of American folklore," he says.

You'd get about 50% to 60% of the retail price if you sold such a card to a dealer--a higher percentage than usual because of the demand, says Sandground. You could get more if you sold it at auction, but you'd probably have to pay a 10% commission.

PENALTIES FOR TARDY CD CASHOUTS

I went to my bank to cash out a one-year certificate of deposit 14 days after it matured, and I was penalized because I showed up late to request the money. Is this unusual?

--GUY YOLTON, Penn Yan, N.Y.

Unfortunately, no. Banks typically roll over certificates of deposit into they mature. If you cash in the CD more than ten days later, you'll be charged a penalty for early withdrawal unless you wait until the new certificate matures, says Rob Rowe, regulatory counsel for the Independent Bankers Association of America.

For example, 1st Source Bank sends out renewal notices for each CD about two weeks before it matures. To cash it in, you must sign the certificate and deliver or mail it to the bank. If it's postmarked within ten days of maturity, you'll get the full principal and interest on the CD as if it hadn't rolled over. If the postmark on a CD is later than that--say, 14 days--you'll earn 14 days' worth of interest on the new CD but will be charged an early-withdrawal penalty equivalent to three months' worth of interest on a one-year CD and six months' interest on a CD with a longer maturity.

BEST DEALS WHEN YOU CALL COLLECT

I see so many ads on TV about "800" numbers for making collect calls. Are these numbers a good deal?

--S.J.L., Philadelphia

They beat dialing zero. If you call collect by dialing zero, AT&T and Sprint would charge $6.45 for a ten-minute call from Boston to Philadelphia on a weekday evening. MCI WorldCom would charge $6.95. The same call would cost only $2.99 if you dialed 1-800-collect to access MCI WorldCom's service or 1-800-one-dime for Sprint's service. AT&T's 1-800-call-ATT costs $4.89.

The three phone services all charge a $1.99 connection fee for their "800"-number collect calls, plus a per-minute rate. Sprint charges 10 cents per minute anytime, AT&T charges 29 cents per minute anytime and MCI charges 10 cents per minute for evenings, 39 cents for weekend days and 49 cents for weekdays.

WHAT HAPPENS IF THE BROKER GOES BUST?

Is there more risk for investors who use some of the new, ultra-low-cost online brokers? What happens to accounts held in street name if the broker goes bankrupt?

--LONG QUAN, Houston

As long as the broker is registered with the Securities and Exchange Commission--and all brokers are required to register--your investments are covered by the Securities Investor Protection Corp. (SIPC). If your broker goes bankrupt, SIPC first tries to transfer your account to another firm--often before you can file a claim--or returns your securities, usually within three months, giving you the same number of shares as you had before the bankruptcy. In some cases, SIPC will give you cash instead, making up the difference between the value of your account when the firm filed for bankruptcy and your share of the firm's assets after the bankruptcy is settled (SIPC covers up to $500,000, with a $100,000 limit for cash).

Investors with very deep pockets could lose money at a small brokerage firm. Most firms have private insurance, which kicks in if your loss exceeds SIPC's limits. The companies featured in our online-broker survey, "Cheap Frills," in the October 1998 issue (also available at www.kiplinger .com under "Investments") all have private insurance, but small firms tend to have less than the big names in the industry. For example, Fidelity, Schwab and Suretrade have $99.5 million in additional coverage for each account, but Datek and Scottrade have $2 million each. SIPC has liquidated seven brokerage firms a year over the past ten years.