Buying and Selling Gold

 Tom Newcomer, Gemologist at R Bruce Carson Jewelers. 

With gold at historic highs and the desire  to raise some extra cash to offset inflation, it may be the perfect time to sell some of that jewelry that you no longer wear.  The question is what steps to take to ensure you get the best return for your unwanted jewelry.

Step 1: Jewelry Triage

  
Separate your jewelry out by type.  Sterling silver, gold, platinum and palladium  have value and you should separate out each appropriately into groups.   Look near the clasp or inside the ring shank or earring posts or backs for markings to determine the precious metal content.  Sterling silver is typically either marked “925” or “sterling”.  Gold jewelry is marked according to the amount of gold content in the piece.  10k is marked “10k” or “416”, 14k is stamped “14k” or “585”, 18k is stamped either “18k” or “750” and so forth.  Platinum is market as “PLAT” or “90%PLAT/10IRID” or “950PT” and palladium is typically stamped “PALL”.  
Separate your jewelry out in each category and if you are unsure of the metal content, bring the jewelry into a reputable jeweler who has the equipment to test its purity.  For jewelry containing significant gemstones, the value may lie primarily in the gemstone in which case it may be wise to get a formal appraisal from a qualified gemologist appraiser to do a formal appraisal.

Step 2:  Finding a reputable buyer

Find a business in your location that has both a license to buy jewelry and the gemological knowledge to evaluate its worth.  A licensed second hand precious metals dealer will be certified by your state and be required to have scales that are regulated by the state. You can do an online search of qualified jewelers/appraisers in your location by checking to see if they are members of either the American Gem Society (www.americangemsociety.org) which is a great consumer protection group or Jewelers of America (www.jewelers.org).   Contact the jeweler to determine 1) If they purchase jewelry 2) If they have a gemologist on staff 3) Are they licensed by the state to purchase precious metals.    There are jewelry buyers on-line but the Better Business Bureau receives a lot of complaints about on-line buyers and when possible it is preferable to be able to visit a reputable, qualified buyer in person.
Whenever possible it is best to visit several qualified buyers to get competitive quotes.  Also when selling articles of jewelry where the diamond or gemstone has an independent lab report such as GIA, AGS, or AGTA it is best to bring that report with you to the prospective buyer.  

Step 3:  Make an informed decision

Once the jewelry is separated out and tested you should be able to ask what the net gold or other precious metal weight is of each item.  The value of the offer should be based upon current spot price of the metal times the weight in grams or pennyweight less the profit margin and cost of refining. An excellent means of getting is www.kitco.com.   Most licensed secondhand precious metals dealers are also buyers of silver flatware and hollowware, gold and silver coins and other gold and silver bullion.  However, if the coins have greater numismatic value it may be better to consult a coin dealer with appropriate credentials.   current spot pricing for precious metals
Typically, you should expect to get 90 to 95% of the spot price value for coins and anywhere from 50% to 80% of the melt value from the spot price for jewelry.   The melt value is based upon the weight of the piece after deducting the amount of alloy (ie 14kt is 58.5 gold 41.5% alloy), refining costs and profit margin.  The offer of melt value really pertains only to jewelry that has little or no resell value in its current state.  For antique pieces, designer pieces and items of aesthetic quality that have potential resell value, the offer to purchase should reflect that value.  Additionally, some jewelry stores will offer a higher price than “melt” towards the purchase of new jewelry. 

Gold Calculator

The Gold Calculator has functions and data useful for jewelers, pawn brokers and other buyers and sellers of gold.

Functions

• Gold Alloy Value: Computes the value of Gold Alloy based on the purity (karat) and weight.
• Gold Buy Price: Computes the Jeweler's Buy Price for gold based on the current value of gold, the karat purity, a scrap processing fee, and the jeweler's profit margin.
• How Much Gold I Can Buy: Computes the weight of gold one can buy based on the amount of money one has, the current price of gold and a reasonable retailer markup.
• Krugerrand Coin Value: Estimates the value of a number of South African gold Krugerrand coins based on the number of coins, the coin size (1, 0.5, 0.25 and 0.1 troy ounces), the Krugerrand's weight and purity, the current spot price of gold and a coinage factor (percent).
• Gold Eagle Coin Value: Estimates the value of a number of American Gold Eagle coins based on the coin's size (1, 0.5, 0.25 and 0.1 troy ounces), the Eagle's weight and purity, the current spot price of gold and a coinage factor (percent).
• Gold Maple Leaf Coin Value: Estimates the value of a number of Canadian Gold Maple Leaf coins based on the coin's size (1, 0.5, 0.25, 0.1, 0.005 troy ounces), the Maple Leaf's weight and purity, the current spot price of gold and a coinage factor (percent).
• Gold Talent Value: Estimates the value of any number of biblical talents of gold in todays money.