Posted by: rasmussen
January 9th, 2012

Selling your old gold and silver

“Where can I sell my old gold?”

“How do I know I’m getting a fair price?”

“Why aren’t the gemstones worth anything?”

All great questions, and trust me, you’re not the first person to ask them, and you won’t be the last.  In this post I hope to give you some information that will help.  It might seem a little long, but there’s a lot to cover.

First, let’s talk about the price of gold.  When you hear people talking about the price of gold being so high, they are talking about pure gold, 24K which is bought and sold as a commodity.  The gold that is used in jewelry manufacturing is only a portion of the entire piece.  10K, 14K, and 18K are the most popular alloys in jewelry.  The measure of karat is best described as a ratio or percentage of pure gold in the piece of jewelry.  10K gold is 10 parts gold and parts “other metals,” or 41.6% gold.  14K is 14 parts gold and 10 parts “other metals,” or 58.3% gold.  18K is 18 parts gold and 6 parts “other metals,” or 75% gold.  

The “other metals” that are talked about are often proprietary blends designed to make the finished piece more durable, easier to work with, or even change the overall color.  Copper and silver are two of the most common metals alloyed with gold.  In order for the gold to be reused, it must first be refined.  Melted down, separate out the other materials, re-alloy with new metals and finally turned back into jewelry.  There is an expence for this entire process.  And to make it cost effective, you have to refine a lot of gold at one time.  It is sometimes possible to simply re-melt and re-use the gold, but it often results in a porous and pitted final piece.

“Where can I sell my gold?”

Today there is no shortage of places to sell your old gold.  Places seem to pop up overnight!  The first and most important thing to remember is find someone you trust.  In our experience, independent jewelers almost always pay more than any other place.  The simplest reason is this, they are in business to sell jewelry.  An independent jeweler doesn’t need to rely on scrap gold as a profit center to stay in business.  Billboards, newspapers, and TV commercials all cost money to produce.  If a business’ main source of income is scrap gold, they need to make enough profit from your gold to pay for those ads.   News programs have done countless reports on selling gold and how to avoid being cheated.  This video from a San Francisco CBS affiliate did a really great job explaining the process.  Check out the video here.  Depending on the volume of gold a store buys and sells to refiners, the prices the store gets from the refiner may vary quite a bit. 

“How do I know I’m getting a fair price?”

That can be a tough one.  Again, you need to trust the person buying your gold.  As the above video states, there can be range.  I also caution people about the value of their time, and gas!  I certainly agree with the idea to “shop around,” but at some point you need to factor in your time and money spent on gas getting from place to place.  I must regretfully tell you of a time  a guest chose not to sell his gold to me.  He got a price that was $10 better.  Unfortunately he had to drive 60 miles round trip to get to the other store.  Let’s assume his car gets 20 miles/gal.  At $3.25/gal for gas, he spent $9.75 just to sell his gold for $10 more… not to mention the time out of his day. 

“Why aren’t the gemstones worth anything?”    

In most cases, we can’t reuse the gemstones in the jewelry.  Gemstones, diamonds included, can chip, scratch, and break.  The used/worn gemstones can’t be put in jewelry and sold as new.  If they are going to sold as “used” or “estate” jewelry, the selling price is only a fraction of a new piece.   Additionally, the labor costs to remove the gemstones can often exceed their value.  When the items go to the refiner to be melted, the stones are sometimes removed via an acid bath or  just burned out and destroyed.   Some diamonds can be reused, but that is on a case by case basis. 

Other things to consider:

-Signs in the windows of 3 stores in your home city: “We pay the most for your gold!”  “Highest payment for your gold!” “Top dollar for your gold!”   I hate to burst your bubble, but someone’s lying. They can’t all be paying the most, and if you have to put a big sign in your window odds are pretty good none of you are paying the most in your city. 

– Home Gold Buying Parties:  Remember, business need to make money to stay in business.  If the company running the sale offers you a “commission” or “bonus” on the amount of gold your friends bring to the party, the money is coming from somewhere, usually the amount your friends could have gotten for their gold had you taken it somewhere else.  Find the local independent jeweler paying the most and have a “party” in their store!

– Quoting prices over the phone:  Are they paying per gram? per pennyweight? per ounce? Is it a sliding scale?  What is the price of gold when you called vs when you brought in the gold?  It’s way to easy to quote a higher price over the phone simply to get you in the door only to find a “problem” with your gold that would make the price lower than quoted over the phone. 

Finally, I’ll tell you that I do not promise to pay the most.  There is no way I can guarantee that someone isn’t going to pay just a bit more to prove me wrong.  I can tell you that we’ve had thousands of happy customers who recommend us to their friends and family.  I can tell you we’ve been here in Racine for more than 100 years, and you don’t get the privilege of staying in business that long if you make it common place to be dishonest to your customers.

I appreciate your business, and I’d love to hear your feedback on this post.  If you have a specific question, post it below and I’m happy to answer.

Ciao,

JH

2 Responses

  1. Gary Dahl says:

    Do you buy silver pieces?

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