How much is that gold jewelry worth?
June 13th, 2009 | by mbhunter |Short answer: Probably less than you think, but more than you’ll get from a gold-to-cash place.
Pinyo over at Moolanomy asked whether Cash4Gold.com is a scam or not. Cash4Gold.com, and places like it, will pay you for your jewelry based (mainly) on its precious metal content. You ask them for a postage-paid envelope, you mail in your valuables, and a few days later you get a check and ride off into the sunset.
Except that some folks were, shall we say, a bit disappointed with the size of that check. They’re not going to give people top dollar for their stuff because they have to (a) pay for shipping, (b) pay people to value your stuff, (c) pay to cut the check and mail it, and (d) make a profit. You pay dearly for the convenience of selling your jewelry by throwing it in an envelope.
There are flags with this kind of service anyway. You don’t get any indication of how much they’ll pay you until you open up the check. But at that point, they have your stuff, and the clock is ticking — or may have already ticked away — for you to contest it. But people do it, so this encourages them to stay in business.
So, how do you figure out what your jewerly is worth? First, you look for the stamp on it to see what it’s made of. Here’s some of what you might find:
- Three numbers. Put a decimal point between the middle and last digit, and you have the purity of the precious metal in percent. So a gold chain stamped with “375″ would be 37.5% precious metal, or 9 carat gold. One stamped with “585″ is 58.5%, or 14 carat gold. “916″ is 22k gold, the standard for many gold coins. “Pure” gold may be designated “990″ or “999″ if it’s gone through some more refining.
- 10k, 14k … or 18ct, 24ct. Pure gold (99% or higher) is “24 carat.” So 10 carat gold is 10/24, or 41.7% gold. 14-carat gold is 14/24, or 58.5% gold. This marking is also called “solid gold” but it does not necessarily mean pure gold — just that it has the same alloy throughout.
- 1/20 14k, or 14kgf. This is “gold filled” which, unfortunately, does not mean “filled with gold” but instead “gold, filled with something else.” The 1/20 means that the weight of the gold is at least 1/20th, or 5%, of the total weight. The letters “gf” in the second example indicates that the piece is gold filled, but there is no gold weight requirement.
- GE, HGE. Stands for “gold electroplate” (at least 7 millionths of an inch) and “heavy gold electroplate” (at least 100 millionths of an inch).
Second, you weigh the jewelry. If it’s nothing but metal, then the rest is easy. If there are gems, then it’s a little more complicated. Let’s take an example. Say you have a 14k gold chain that with a mass of 30 grams. (I’m a physicist by training, so “mass” and “weight” aren’t the same thing, but I won’t give you a physics lesson now. 
) So the amount of gold you have in that chain is 14/24 times 30 grams, or 17.5 grams. A 30-gram chain marked “1/20 14K” will have at least 5% of 30 grams, or 1.5 grams, of gold.
Last, you look up the price of gold. Kitco is a good place. Today it closed at $938.30 per ounce. (This is per troy ounce of gold.) There are 31.1 grams in one troy ounce, for my 14k, 30-gram gold chain, the melt value of the gold in that chain is 17.5 grams / 31.1 grams times $938.30, or $527.98. The gold filled chain has at least $45.25 worth of gold in it.
These are calculations you can do to see how much someone is lowballing you when they give you a price for your jewelry. It’s also handy to see what kind of markup people are asking for their jewelry. I ran across this 14k yellow gold curb chain on Amazon.com and it seems to be a great deal according to the specs. The total metal weight is advertised as 14.2740 DWT (pennyweight). There are 20 pennyweight in a troy ounce. The gold content is then 14/24 times 14.2740/20 troy ounces, or 0.416 troy ounces. At $938.30 per troy ounce, the melt value is $390.67. They’re only asking $399. It’s hard to get bullion coins for this kind of markup these days.
Knowledge is power. Now you can figure out a little better what that jewelry is really worth to someone buying it off of you.
(Note: Thanks to Living Almost Large for including this article in the Carnival of Personal Finance!)
8 Responses to “How much is that gold jewelry worth?”
By MoneyEnergy on Jun 13, 2009 | Reply
Good analysis. I don’t personally have a lot of gold jewelry, but I know people who do. One wonders how much the markup really is on the gold it contains itself. I know I probably wouldn’t even buy gold coins less than 99% – so that 916 number is good for jewelry, less so for bullion.
By mbhunter on Jun 13, 2009 | Reply
22k is fairly common for coins. Krugerrands are 22k as are most older American gold coins. The newer American gold coins are 24k. It’s rare to find 22k gold jewelry because it’s too soft. 14k is about as high as you would want to go.
By Kosmo @ The Casual Observer on Jun 19, 2009 | Reply
There was a burglary ring in a town I used to live. They targeted Indian families because of the gold jewelry (gold is a very big thing in India).
The thieves didn’t bother with pawn shops. They just shipped the stuff to the cash for gold places, essentially turning them cash for gold place into a fence. They probably got more than they would have on the street …
By Mikael @ Retire Early on Jun 26, 2009 | Reply
I have to admit that I have been around long enough to be very suspicious when I come across these sites. There have been (and probably still is) so many scammers in that niche that I would personally only want to deal with the top sites in the industry.
By diamonds on Jul 13, 2009 | Reply
Great post, very helpful to anyone looking to sell scrap gold. Isn’t it funny how all these sites just popped up when gold prices started to shoot up? I think one could do just fine by visiting several local jewelers in their area to compare what they are willing to pay for scrap. That way you have no suprises and you’ll have a better idea if you are getting a fair payment.
By Jose gomez on Aug 5, 2009 | Reply
i know the other company goldkit is bs, i sent in some of my jewelry(gold) hoping i would get a fair amount , but tell me how, when i got the check it was at the amount of 58.**
By michael on Mar 5, 2010 | Reply
HI, The following statement is from the above article. ” A 30-gram chain marked “1/20 14K” will have at least 5% of 30 grams, or 1.5 grams, of gold.”
It later states, “The gold filled chain has at least $45.25 worth of gold in it.” This was based on a spot price of $938.30.
I may be wrong, but I believe that the correct ending to the first quote should state,” 1.5 grams of 14K GOLD.”
Therefore, if a 30 gr. chain of 14K contains 17.5 grams of “pure” gold, then a 30 gr. chain of 1/20 14K should have 1/20th or 5% of 17.5 grams. This amounts to .875 grams of “pure” gold with a value of $26.40, and not the $45.25 quoted in the article. Thanks
By mbhunter on Mar 8, 2010 | Reply
Michael: I had two examples going in parallel. Two 30-gram chains: one 14k (solid) gold, and the other gold-filled.