Encore: Is There a Gold Mine Hidden in Your Jewelry Box?
With the precious metal gold fetching record high prices, consumers are digging through desk drawers and jewelry boxes for a new stream of cash. The commercials promise new shoes and televisions, but is anyone really getting rich off Grandpa's class ring or that broken chain?
Almost everyone has some old gold lying around—somewhere. An earring without a mate. A necklace without a clasp. Maybe even gold from old dental work that has been redone. There isn't much of a market for such broken or unusable items, but there is a market for gold. And with record high trading prices topping $1,800 per ounce, there is sudden value in objects that many might have regarded as junk.
Pair that with a still-shaky economy that has a lot of people out of work and looking for new income streams, and suddenly selling gold for melt value doesn't sound like a bad idea at all.
For most people, the idea strikes while watching TV or surfing the Internet. The commercials and ads instruct you to package up gold belongings, send them off, and wait for your check. But is that really the best way to get the most money from your possessions?
It turns out that getting cash for cast-off gold isn't complicated at all, but experts agree that you're probably better off doing a bit of comparison shopping in your own neighborhood than you are dropping an envelope in the mail. Chances are there is someone in town—maybe even the jeweler who sold you your wedding rings or the earrings for a Mother's Day present—who'll buy your gold or direct you to someone reputable who will.
First, you probably need to adjust your expectations, says Cecilia Gardner, president and CEO of the Jewelers Vigilance Committee, New York, an education and self-regulation trade organization. Most people aren't going to get rich from selling scrap gold, and many aren't going to get as much money as they think they will.
If you have several pieces, it makes sense to shop around to see who'll give you the best price.
While it is impossible to estimate how much any piece will get, an average size 14-karat man's wedding ring could be worth $30 or $40. It's not a bad sum, but it's not an exotic vacation, either.
Helena Krodel agrees. "People are under the impression that [jewelry pieces] are much heavier than they are in reality," says the spokesperson for the Jewelry Information Center, the public relations arm of a national trade association for the jewelry and watch industries, New York.
And that isn't the only misconception that many individuals have about their jewelry. "A lot of people are operating under the misapprehension that the gold jewelry they have is all gold, and it isn't," Gardner adds.
Jewelry is never made of pure gold. Pure 24-karat gold is too soft to be fashioned into jewelry, so gold is alloyed with other metals to add durability and strength along with color, affordability, and other features.
The amount of gold in any ring, necklace, or other item is indicated by its karat weight. According to U.S. law, the karat weight must be inscribed somewhere on the piece, Krodel says. To find the karat weight, look on the inside of a piece, such as a ring, or in the clasp of a necklace (a magnifying glass will help). Krodel says U.S. law also requires that each piece of jewelry contain a trademark symbol as well.
"If there's a hallmark there, it means the manufacturer stands behind the accuracy of the karat weight," she explains. That allows the jeweler to trust the imprinted karat weight.
In the U.S., gold jewelry is 10-, 14-, or 18-karat, with 14-karat being the most popular. The karat weights translate into percentages of gold—41.6%, 58.3%, and 75%, respectively.
Go to a reputable jeweler to sell your pieces.
Gardner says individuals won't receive money for any of the other metals alloyed with the gold, and the value of just the gold is going to be far less than the purchase price of any piece.
"If you paid $150 for a ring, you're not going to get $150," Gardner adds. "You're not going to get back the labor that went into making the ring or the retailer's markup when they sold you the ring. This is not going to be a dollar-for-dollar transaction."
Further, most jewelers or others who buy gold will not pay that day's full trading price of gold. There is a cost in melting the gold down and reselling it. So to cover their expenses, most gold buyers pay a percentage of the current trading price.
Gather your gold
If you have gold to sell, most experts recommend that you gather it all and sell it in one transaction. The economies of scale kick in, and you'll likely make a better profit than if you sell things piece by piece. "The quantity makes a difference," says Margaret Olsen, a Westminster, Colo., jewelry dealer and appraiser. "Someone may pay you more if you have a larger quantity."
Once you have all your items together, take stock of what you have and then sort the pieces. Gather together the broken chains, gold from teeth, single earrings, and anything else that you definitely don't want or that doesn't have much value in its current form. "What good is one earring?" asks second-generation Chicago jeweler Gayle Inbinder. "Melt that."
The remaining items are those that might have some value: rings with gemstones, heirloom jewelry in good condition, and anything to which you might have any sentimental attachment. You might want to consider having all or some of these appraised.
"There are some jewelers that buy and resell vintage jewelry," Inbinder says. "They might pay you more than a jeweler who is going to melt it down."
If you don't want to part with the gold you're considering selling, turn to your credit union for financial options.
Get appraisalAppraisals cost money, Olsen notes, so be selective. Olsen says some appraisers will do an initial sort for a fee. They won't determine what every piece is worth, but they will separate things with potential value from those without. Then you can decide whether you want to have any items appraised individually in case you decide to sell them in their current form instead of for the melt value of the gold.
Whether you're looking for an initial appraisal, someone to buy your gold, or both, experts recommend that you look in familiar places first. Call the jeweler who sold you your wedding rings or who appraised the jewelry from your grandmother's estate. If that person can't help you, chances are that he or she will recommend someone who can. "You want to go to a reputable jeweler to sell your pieces," Krodel says, "just like you would go to a reputable jeweler to buy something."
If you have several pieces, it makes sense to shop around to see who'll give you the best price. "You will get a variety of offers," Gardner says, "and you should take the highest one."
The exception, Olsen says, is when you don't have much to sell. "It you're selling a single item that doesn't have much weight, it's not going to make much difference," she says. "You're talking about expending a lot of time for not very much money."
Most people aren't going to get rich from selling scrap gold.
It's not something you do every day, but there is nothing unsavory about selling your unwanted gold. It's a legitimate thing to do, you can get some money from things you don't need or want, and there are reputable businesses with which to work. "There are good people out there that are trying to do a good service and help people realize some value out of things that might have become junk to them," Inbinder explains.
So what about the Internet companies and businesses advertised on television? Most experts are wary. "I'm shocked at how many people feel comfortable sending things off to people they don't know (and) without knowing how much they are going to get or even what they have," Olsen says.
Olsen recommends working with a local buyer, yet she recognizes that some people prefer the ease of mailing off their gold and waiting for a check. She advises those consumers to spend a little time researching the company to find out where it's located and what its policies are, especially whether individuals have a right to refuse the sale amount if they aren't happy with it. She also suggests finding out if the company is insured and taking photos of pieces that are mailed just in case there are problems.
Gardner advises individuals to make sure the company is legitimate, especially if it's an Internet business. She says to look for an actual business location and mailing address, and to be leery of any company that doesn't have contact information or that has typographical errors and misspellings sprinkled throughout its website.
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