I invest in Lego because it’s better than stocks, bonds and gold – and I made $500k in 2 years

Shane O’Farrell had no intention of getting rich by buying and selling Lego – all the 35-year-old from New Jersey was looking for was a connection to his childhood in Ireland, where the modest Fort Legoredo was one of them. favorite toy.

Twenty years later, when he saw the kit going for hundreds more than its 1996 retail price of $85, it was a lightbulb moment for side hustle seekers.

O’Farrell quickly jumped into what turned out to be a lucrative market of buying and trading coveted Lego sets online. The same set he wanted currently sells for $2,405.

The savvy service engineer is one of a growing number of investors splashing their hard-earned cash on plastic bricks — at a time when Lego’s resale value has risen 11% year-on-year and outpaced the stock, bonds and gold, according to a 2022 study.

“I started trying to invest in stocks and realized that the 8% per year I’m making in the stock market is not going to work. It’s not really going to get me where I want to go,” O’Farrell told The Post. “It would take decades.”

In the last two years alone, trading his toys has brought him about $500,000.

“The time it takes is very minimal, so I can do it on top of my full-time job and generate extra income,” O’Farrell said.

A plastic wallet

“You’re talking about a 400% return on investment in a year and a half.”

Shane O’Farrell

He’s so enthusiastic about his part-time gig that O’Farrell even shares advice for potential investors on his YouTube channel, called Brick Bucks.

What is required is a standard-sized storage unit for inventory and a set of keen eyes monitoring the companies, he said. O’Farrell reads annual financial and trend reports released by Lego, also keeping track of when sets are being retired to help determine future value.

Once Lego stops selling a particular model, then the store opens up to sellers like O’Farrell. More recently, this was the Lego “Star Wars” TIE Fighter Pilot Helmet Model.

“It was $60 before it retired in 2021. Then, with about a year and a half of retirement, it was $350,” O’Farrell said. “You’re talking about a 400% return on investment in a year and a half.”

Lego collaborations with giant franchises like “Star Wars,” “Harry Potter” or Marvel don’t always guarantee increased resale, he said.

Instead, absence is a key. Sets exclusively for sale in a store – as there are likely to be fewer produced – tend to be the best due to post-retirement demand.

There is also a market just for minifigures within a set. They are in such demand that bandits recently broke into a group of stores in California and made off with $100,000 worth.

Recently, O’Farrell noticed an uptick in demand for the minifigures sold in Lego’s $460 Lord of the Rings Barad-dûr set.

“People were selling just the minifigures from the set for $250,” he said of the high-end Eye of Mordor model.

In time, Frodo Baggins, Samwise Gamgee, Gollum and others will likely be worth even more.

‘A Waiting Game’

O’Farrell said returning Legos is easy as “value increases over time”. You just have to be patient.

“You can just buy the stuff, put it in storage somewhere and just wait for the price to go up,” he said. “The workload is quite low.”

Another retailer and YouTube personality, David G – who does not use his last name for privacy reasons and instead goes by DG Bricks – said: “It’s kind of like running a wine cellar.”

“I’m buying products that are available today. I’m keeping them safe waiting for some future customer, years later. It’s a waiting game,” he told The Post.

The 27-year-old Chicago-based freelance videographer has sold $20,000 worth of Lego sets in his lifetime.

Of the estimated thousand he invested in and held onto for years, only one never paid off — a $12 Disney Frozen set that he resold for $10.

However, DG does not call the Lego economy an investment cheat code. There is a lot of knowledge required to make a profit.

“There are a lot of stars that go with that impressive ROI number,” he said. “You have to buy at the right price, you have to definitely pick the right groups – not all groups rate the same rate or at all.”

Plastic in dough

Still, DG thinks it could be an ideal market for Gen Zers and millennials to dip their toes into — especially since demand for adult toys surpassed that of preschoolers for the first time ever, reaching $1.5 billion in sales from January to April, new data shown.

“For a young person like me, I have a lot of time on my hands, but what I lack is a significant amount of capital,” he said.

“I think for young guys starting at that position, you would get that trade. I will do more work in exchange for a higher return on my investment.”

As the current most valuable toy brand in the world “Barbie doesn’t even come close” more people are putting their dough into plastic bricks.

Jonny Cangemi, a 26-year-old fintech worker in the Financial District, has been an avid Lego builder since he was 5 years old, but is just starting out as a salesman.

He bought a Lego “Star Wars” Grog set a year and a half ago and plans to keep it for five years before returning it.

“I truly believe that building things and being creative as a child leads to your mental growth. I remember the sensations that accompanied me until today,” said Cangemi.

“I’m glad I was growing up like a kid without a phone in my hands and now I can grow my bank account too.”