Buying gold from the public has become big business for many retail jewelry stores. I have to admit, it is a big part of mine. In the past three years I have easily bought tenfold the amount of gold that I have sold.
It is true, with the exorbitant prices of precious metals, folks selling their gold are getting more money that ever before and in some cases, more than they paid for it originally. I get all kinds of reactions when quoting prices for what is presented to me. “You’re kidding me!” or “That much?” and the occasional “That’s all it’s worth?”
Obviously most people have a preconceived idea of what they feel their gold jewelry is worth. The reality of it all is…. most are disappointed. Selling gold at the scrap price means just that. The fact that it was made by Cartier or K-Mart means nothing, you get paid for the weight of the gold.
Most shops advertising that they buy gold, purchase it this way and do not pay for the sentimental value it may have to you. The fact that Aunt Grezelda gave you that hideous ring when you graduated high school in ‘68 doesn’t factor here. What karat and what it weighs does.
Don’t expect to receive top market price you see on the TV screen every morning, unless it is pure 24 karat bullion, because you won’t.
Most jewelry manufactured in the U.S.A. is 14 karat and that is only 58.5 % pure making the other 41.5 % of the scrap piece base metals or alloys. These metals can include copper, brass, nickel and silver to name a few, nowhere near the cost of gold. The higher the karat gold your scrap is the more money you should receive for it. Obviously, dealing with reputable buyers is advised, because how you are paid can be confusing.
Gold can be weighed two ways, by the gram or by the pennyweight, two different forms of measure. 31.1 grams = one ounce and 20 dwts. ( pennyweights) also = one ounce.
Here’s a simple example. Let’s say the dealer offers you $20.00 a pennyweight for your gold, sounds like a lot of money but when converted to grams it’s only $12.86 because the weight of measure is different. $20.00 x 20 dwt = $400.00 $12.86 x 31.1= $399.946 The same money just sounds like more.
So how much should you get? Good question, and hard to answer. The market changes are so volatile now that we count by minutes not days or months as before. I have quoted prices to folks, who reply they will think about it and come in the next morning to find their gold is worth less than the day before. It’s within my right to pay the exact market price at the time you sell it, so when you leave with your gold after a price is given, all bets are off when the door closes behind you. We both take a gamble. The next morning gold can open up or it can be down and the gold we talked about yesterday is worth less.
Personally, I pay higher for “clean gold” than I do for 10 karat or small broken chains and gold teeth. They are full of impurities requiring the use of a refinery to remove the alloys and solder to make the scrap valuable, thus reducing the weight. It is also costly which is why I have to pay less.
I will pay more for solid pieces such as wedding bands, bracelets, earrings because I can utilize the gold in shop to make new jewelry avoiding refining costs. I dread when someone comes in with pure gold bullion or ingots, especially when they expect to get exact market price. It simply leaves me no room to make even a dollar. If the market is $1800.00 an ounce, they want $1800.00 as they should. You’re just not gonna get it from me. When I refuse to buy it they look at me as if my cheese slipped off the cracker. “But your sign says you buy gold!” I’m not crazy, I’m smart.
To lay down 1800 smackers and not make a dime in profit is nonsense to me. I would offer $1700, a fair deal. Even the gold brokers you see on TV charge commission fees both when you buy and when you sell. It’s never exact money for gold. Some pawn shops may pay more for high dollar pieces. They clean and polish them and reprice them and hope they sell in the showcase.
I don’t sell second hand jewelry. One of the problems with estate jewelry (a fancy term for second hand jewelry) is you can buy someone else’s headaches, such as worn prongs or fractures, worn or chipped stones, etc.
Buying gold daily from the public means there is never a dull moment. It always seems the uglier the piece the more the customer wants for it. I then say, “if it’s so wonderful why are you selling it?” As I have said before, if the jewelry is sentimental don’t sell it, it can never be replaced.
Richard Alan is a Designer/Goldsmith and the owner of The Harbor Goldsmith of Marco Island and welcomes your questions about “All That Glitters” at 239-394- 9275 and firstname.lastname@example.org