In this down economy, many people think about selling gold jewelry to make some extra cash. But all too often, the buyer is less than honest, and doesn’t give you a fair price. Here are some tips to help you sell your gold safely, and not get ripped off.
– Understand the market. What do you think the buyer does with the gold they buy? They sell it for scrap, usually to a large refiner. With a little research, you can find out how much the buyer will receive from the refiner. With that knowledge in your mind, you can sell your gold with confidence.
– Identify your gold. Here, you need to look for the karat marking. You will need to get a magnifying glass, but they are widely available. If you have a few pieces of gold to sell, you might want to get what’s called a “jeweler’s loupe,” which is a small, powerful magnifier that can be found for $20 or less. Look for a tiny marking on your jewelry, that says 14K, or 18K, or even 22K. You may see, instead of those karat marks, numbers like 585, 750, or 916. They mean the same thing. I’ll discuss later what to do if you can’t find a karat mark.
– Weigh your gold. Here, you will need a gram scale. You can get one on Amazon for under ten bucks. Weigh your piece of gold.
– Find today’s spot price for gold. This is relatively easy to find online. There is a site called kitco.com that has it available. Just make sure you get the price of gold in troy ounces, not regular ounces. There is a difference. A troy ounce weighs almost 1.1 regular ounces. Today, for example, the spot price (or bid price) is $1745 per troy ounce.
– Do the math. Here, it gets a little tricky, because in order to use the most simple formula, you have to work with something called “pennyweight” (dwt) as well as grams. But it’s not hard to do. The formula is:
(Spot price ÷ 480) x karat = price per dwt
Then afterwards, we’ll just convert dwt to grams.
Here’s how it goes, using today’s spot price, and assuming an 18 kt piece of jewelry.
Step 1. (1745 ÷ 480) x 18 = $65.44/ dwt.
To convert dwt to grams, simply multiply the dwt by .643
Step 2. $65.44 x .643 = $42.08/ gram.
Therefore, the spot price of 18 kt gold is $42.08 per gram.
– Calculate the value of your piece. If you have an 18 kt gold band that weighs 10 grams, it’s current value is 10 x $42.08, or $420.80.
– Figure how much you will accept. In the above example, you know that the buyer will be getting spot price, or about $420 from the refiner for your gold ring. How much should you get from the buyer? A good rule of thumb is that the buyer should take about 20% for his or her cut, and you should get the rest. You should get about 80%. If you get more, you are doing really well. If you get offered less than 75%, you should try somewhere else.
– What to do if you can’t find the karat mark. Take it to a storefront gold buyer, or a local jeweler, and have them check it out. They may need to test it. Then when you know the karat of the piece, bring it home, and do your math. Then head back out to sell it. Good luck in the marketplace!