Gold prices are still sky high. It is tempting to rake through your jewelry box to find gold items you no longer wear to take advantage of today’s high prices.
Before you decide to sell, consider the following.
- Gold is going higher CNBC thinks it will hit $2000 this year
- Gold will keep it’s value as money, even if currencies in the world become worthless. Jim Rogers says “The long term looks bright for precious metals, he says. “There is no paper money in 2014 or 2015 that will be worth much of anything.”
- Gold has been used throughout history to facilitate trade and exchange.
- Gold is limited in supply, easy to carry and pretty to view, making it desirable for trade.
- Gold helps you survive in extreme times.
In the book “Family Fortunes – How to Build Family Wealth and Hold on to it for 100 years”, the authors describe the experience of Marion Szabilcki, a Pole during WWII.
Russia was about to invade Poland, Marion, fighting for Poland, was told by the Polish army to go home to protect his family. He knew his country’s currency would undergo inflation so he dug a hole and hid the family gold and jewelry to use later. Later the next year, he learned that he and his family were to be deported to Siberia. He was able to dig up the gold and jewelry and conceal it in his clothing and sew it into his shoes before being taken away. In Siberia, he used that gold to survive, buying housing, food and tools to work for more goods. He also used some of the gold to bribe his way onto a train to get out of Siberia in 1942.
He says “I owe my life to a handful of gold coins and chains.”
I’m keeping my gold!
But, if you truly need to sell, consider this:
Gold isn’t as easy to sell as you might think, if you want the best value for your item. Think twice about selling what you have and if you do decide to sell take precautions to get the value from your pieces.
Don’t sell your gold until you educate yourself.
Set your expectations.
You probably aren’t going to get full price for your gold piece. According to Kiplinger’s bars or coins might bring 90 – 95% of the current market gold prices, but jewelry may bring only 80 – 85% of the melt value.
Jeanne Phipps in Old jewelry worth its weight in gold? describes it this way:
“A jeweler, pawn broker, gold refiner or scrap gold dealer will buy the stuff in the back of your jewelry box at a price based on the weight of its gold content, minus a handling fee. He melts down the jewelry, extracts the gold and sometimes some of the hardening agents and resells it or uses it himself.”
The gold buyers are in business to make money, they aren’t going to give you retail prices. They need room to make a profit.
Know current prices.
Go into the gold buyer knowing the current price of gold. Look it up. One place is goldprice.org.
Know how ounces are measured.
Different kinds of ounces exist: Troy ounce (31.1 grans) vs a kitchen or postal scale ounce (28 grams) vs penny weight or dwt (1.555 grams).
Some buyers will pay you for an ounce in penny weight – cheating you out of 31.1 grams minus 1.555 grams worth of gold.
The Bankrate article above claims that:
“Most gold transactions are conducted in pennyweights, with 20 pennyweights, or DWT, equal to 1 troy ounce of gold.”
Know what else is in your gold.
Pure gold is too soft to really use, so other metals are mixed in to give it strength (making the metal an alloy not pure gold). Jewelry sold in the USA has to have marks describing the the composition of the alloy, usually with the number of karats.
One karat equals 1/24 of pure gold by weight. So 14 karats would mean the jewelry was 14 parts gold and 10 parts other metals. To be labeled gold it has to have 10 karats. There are kits that can help you test your jewelry, but it should be marked somewhere as to the number of karats.
Consider NOT selling.
Don’t sell jewelry for scrap if it is worth more as jewelry! If you have a designer or heirloom piece it will probably be worth more than melt value – go get it appraised before you sell it for melt value. If you have to sell, try to sell it as jewelry.
Find the right place to sell.
USA Today lists multiple places to sell gold, such as kiosks in malls, jewelry stores, pawn shops and online dealers or neighborhood or church gold parties.
There’s a full scale gold buying storefront in the strip mall where my hairdresser’s shop is!
Gold parties, while most convenient and maybe fun, may be close to the worst place to get best value for your metal. In THE GOLD PARTY SCAMS HOW THEY DO IT… the author tells you why.
The Chicago Tribune checked in with Reyne Haines, an appraiser who specializes in 20th century decorative arts, when writing their article How to sell your gold and diamond jewelry– here’s what she recommended on where to sell:
“What you want to do if you’re selling it on your own is make sure you have all the factual information about that item up front. Find out the color of the stone, the carat weight, what kind of gold it is, what period it was made, and you can try to sell it on your own online at a place like eBay or Craigslist. I would always try that route before I would go to a dealer.”
I agree with this advice, I don’t know that I would ever mail my jewelry into a website before getting paid for it. There are just too many scams being reported about sites that low ball their bid, then refuse to return your item when you reject the bid.
Gold buyers should be licensed by your state to buy gold. You should vet them by using the Better Business Bureau. References from other gold sellers might be good to get as well.
Check with local jewelry stores – ones you trust – maybe even the one from which you bought the piece. If you are selling a coin, go back to the coin dealer from which you purchased or find a reputable local dealer.
What to do when you are ready to sell.
Take your id.
It’s required by the US government that a gold buyer check your id – to help prevent sale of stolen gold.
Weigh it correctly.
Make separate piles of jewelry of different karats and have the piles weighed separately. A favorite trick of buyers is to mix it all together, weigh it and then pay you based on the lowest karat
Don’t take the first bid.
Negotiate for the best offer! It’s a seller’s market right now, so get several bids.
Selling gold, like selling any hard asset, is not simple or easy, at least not if you want the best deal.
Have you sold gold? Do you now regret it? What was your experience?
ABC News 10 Tips for Selling Gold
My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.