Selling Gold - Don't Get Ripped Off

Selling gold, like your old rings and necklaces, looks enticing these days. When you see the advertisements on TV and the Internet for gold buyers, all telling you that you'll get top dollar for your junk gold, remember that you are trading a precious metal for inflation-ravaged US dollars. All things being equal, you'd be better to hold onto your old junk gold. The prices for gold are going to skyrocket in the coming months and years. Don't be surprised to see spot prices for gold above ,000 within the next three years.

Gold is a pretty cool substance. One ounce of pure gold can be stretched into a wire five miles long, or hammered into a sheet so thin that it would cover an area 100 square feet in size and light would pass through it. The word "carat" (of which the notation for gold, "karat," is a variation) comes from the Arabic word "qirat," which means "bean pod." In Oriental bazaars, a tiny carob seed was a unit of weight measurement.

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This list below shows the karat number of gold, followed by the percentage of pure gold in the alloy.

10K 41.7%
14K 58.3%
18K 75.0%
24K 100%

What kind of alloys go into gold products?

GOLD COLOR CHART

These are the alloys added to pure 24K gold to make its distinctive color.

o Yellow Gold: Copper and silver. Yellow gold comprises 85% of the gold sold throughout the world.
o White Gold: Nickel, Zinc, Silver, Platinum, and Palladium. White gold symbolizes friendship and is the most important of the colored golds.
o Pink (Rose) Gold: Copper. Pink gold has become increasingly popular and looks lovely when combined with yellow or green gold.
o Green Gold: Silver, Copper, and Zinc Green gold is being used more and more with pink gold and yellow gold and is an important part of Black Hills Gold's signature grape leaf design.

I decided to test the market yesterday, and sell a piece of jewelry at the highest price I could find that day. So I called five gold buyers and visited the one that gave me the highest quote on the phone.

Today, July 4, 2009, gold's spot price is 1.50 per ounce of 99.99% pure gold. So, every tenth of an ounce is worth .15 today.

The old 14K ring I sold to the gold buyer fetched .00. The ring weighed 0.3 ounce. So, I was paid per tenth ounce. Big difference from .15, huh?

Here is how the buyer explained the pricing process. They start with the daily spot price of 24K gold. Then, they determine the karat of the gold, and multiply the spot price by the percentage of pure gold in it. Then they deduct the refining costs to smelt and recover the 24K gold. Finally, they deduct 10% as their profit.

So, my transaction's numbers looked like this:

Spot price 1.50
Times 58.3% 3.00 of 24K gold in 14K gold
Times weight 0.30 ounce
Gold value 2.90
Less refining ($ 18.60)
Less 10% profit ($ 54.30) actually 33% of 2.90
Net cash value .00

This was the best price I could find. So, as you see, the dealers can and do play games with the percentages, prices, and deductions. It's almost as honest and easy to understand as buying a used car. Almost.

I don't really know if the refining cost is high or not. I don't know if the profit deduction is high or low. And neither will you. So, after the gold buyer lays out his bid for your gold, negotiate to get your best price.

My recommendation is that if you are desperate for cash, call around and get phone quotes from dealers before you get in your car and start making visits to dealers. They won't want to tell you anything by phone because they want to you to be in the store so they can close the deal. Then approach your gold selling transactions with knowledge, which will keep you from getting ripped off.

So, I got killed on this transaction, and the gold buyer will make a big profit at today's gold price. He'll likely wait until gold prices go up before he smelts the gold, and then he'll make more. If you try to sell your gold without knowing their games, you'll also get the lowest price, not the highest price.

Selling Gold - Don't Get Ripped Off

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Selling Gold For Cash - The 3 Most Important Questions When Selling Gold For Cash

Are you interested in selling gold for cash? Gold is a precious metal with inherent value and prices are at a record high right now making it a fantastic time to sell your gold. Whether you own designer jewelry or a drawer full of broken and bent jewelry, you can quickly convert your gold to cold hard cash in your pocket.

The 3 most important factors when selling gold for cash.

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The price you will receive for your items depends on three factors. The weight, the karat or purity and the current value of the gold are the most important factors that will determine the amount of money you receive.

What is the measurement used when weighing gold?

Gold can be purchased in grams and troy ounces. The daily price of gold is in troy ounces; one troy ounce equals 31.1 grams. So you can now determine not only the purity but the weight of pure gold you have in troy ounces.

What do the amount of karats really mean when you sell?

When selling gold for cash it is helpful to have a basic understanding these three things. All gold jewelry is marked with the karat, or purity stamp. 24 karat gold is pure and is too soft for jewelry so other metals are mixed with the gold to make an alloy. 10 karat gold is durable but only has 10 parts out of 24 content, the same math applies to 14, 18 and 22 karat. Divide the karat by 24 and you will have the percentage of pure gold in your item.

What is the current market value of pure gold?

The final factor to consider when selling gold for cash is the current market value. Precious metal values change throughout the day so watch trends closely and sell on the day following a high price as buyers usually base their offers on the closing price of gold from the previous day.

Here are some final considerations as you gather your items to sell. Some pieces of jewelry such as signed designer pieces may have value above and beyond the gold value alone. On the other hand, unmarked dental gold and broken jewelry can easily be sold for the value of the gold they contain.

Now that you understand the basics of selling gold for cash, take a look in your drawers and convert your gold to much needed money.

Selling Gold For Cash - The 3 Most Important Questions When Selling Gold For Cash

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Selling Gold for the Best Price: Grams Vs Pennyweights

When you are selling your unwanted or scrap gold, it can be difficult to choose a gold buyer, as nearly all will claim to have the best prices. To figure out who is really making you the best offer, you need to pay close attention to what unit is being used to weigh your gold.

There are three units of measurement that are commonly used for weighing gold: the troy ounce (ozt), the gram (g), and the pennyweight (dwt). A troy ounce is equal to 20 pennyweights, or about 31.1 grams.

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When you're selling your gold, the two units you need to worry about are grams and pennyweights. A pennyweight is equal to approximately 1.555 grams. The actual mass and value of your gold does not change based on what unit is used to measure its weight, but some buyers will still manipulate these numbers to try to trick you into giving up your gold for a lower price.

One problem lies in the different buying rates for the different units. Let's say that Buyer A is offering per gram for 10K gold, and Buyer B is offering per pennyweight. At first glance, seems like a better deal. However, since a pennyweight is equal to about 1.555 grams, the price per pennyweight should also be about 1.555 times the price per gram. So, if 10K gold is going for per gram, it should sell for .55 per pennyweight - meaning that Buyer B's rate wasn't so good after all.

One way a buyer can use these different measurements against you is by weighing your gold in pennyweights but charging the gram rate. Remember, 1 pennyweight is equal to about 1.555 grams. So if you have 12 grams of gold to sell, that's about 7.7 pennyweights. If the buyer is offering .50 per gram of 14K gold, you should get get 2 dollars from an honest gold buyer. However, if the buyer tries to offer you the gram rater per pennyweight, that would only be 3.95 - nearly sixty dollars less! This is one reason why it is a good idea to have your gold weighed and valued by multiple gold buyers before you make a decision.

Selling Gold for the Best Price: Grams Vs Pennyweights

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Selling Your Gold Jewelry? Here Are Some Things You Should Know

From September 1, 2010, gold has climbed to a record numerous times, peaking on November 9th when it reached ,422 an ounce (the highest ever). While during the same period, there are global concerns that the US dollar will continue to drop in value. According to Bloomberg BusinessWeek, a survey of 29 analysts, traders and investors indicates that gold may rise as high as ,500 in 2011.

If you're strapped for cash like many of Americans today, you may be looking at your spare gold jewelry as a means to help with bills and living expenses. Before you decide to sell your gold, there are some important things you should know:

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Find out the price of gold for the day from websites such as Kitco at website, or newspapers, financial cable stations and other websites. Whether you weigh it yourself or take it to an appraiser, make sure you know how much your gold weighs. Note that gold, silver and other precious metals are measured in troy ounces (equal to 31.1034768 grams). Certain jewelers also use the term "pennyweight" when referring to precious metal, and a troy ounce equals 20 pennyweights. Know the karat in your gold jewelry because the value is based on not only its weight, but its level of purity. The purest gold is 24 karats, and when you see the price of gold per ounce, it is quoted for 24 karat or "pure gold." If your gold is 14 or 18 karat, you will be paid only on the percentage that is pure gold. To calculate, simply divide 18 or 14 by 24. (For example, 14 divided by 24 =.5833 so the gold value for that piece is 58.33% of its weight. 18 karat gold will be valued at 75% of its weight. Bring it to a reputable jeweler, especially if it is an heirloom. This will ensure that your piece will be appraised for its craftsmanship as well as its gold purity and weight. A reputable jeweler will also explain how your gold is weighed, and how you will be paid (dollar amount per gram, troy ounce or pennyweight) and explain the purity level of your gold. Start with scraps of gold from broken jewelry pieces before you sell a more valuable item. That way you can personally gauge your reaction to the buyer, whether you felt that they treated you fairly and were trustworthy, and whether you should deal with them in the future with your better pieces.

Although many economists forecast gold will continue to climb through 2011, if you need to have cash in your pocket, now is a great time to sell the gold you can part with. Make sure you get the price you deserve by doing your homework and dealing with a jeweler who has earned your trust.

Selling Your Gold Jewelry? Here Are Some Things You Should Know

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