Is the time right? Should I sell my gold jewelry? We help you making the right decision.
Dear Maria, I own gold jewelry since a decade. Nearly every year I think about selling but I never did. You read and hear so many different opinions about the right time for selling. One day you read now it’s the best time for selling and just some days later you hear about buying gold as attractive option. But why should I sell gold if just some days later they tell me to buy gold? Maria, I’m so confused now. Should I sell my gold jewelry now, or should I better keep it?
Grace from Denver in Colorado
Dear Grace, you asked me a very good question because selling is always a decision with different points of view. People are selling gold jewelry because of very different reasons. Some Americans sell to get some extra cash, other Americans sell jewelry to get rid of unwanted memories (think about ex-boyfriend jewelry for example), and some just sell because they don’t use their jewelry anymore. What would you do if you would inherit jewelry which you actually don’t need? Why keep it, when there are also no memories connected with the jewelry? But let me explain more things about selling and buying gold.
reDollar appraiser, Maria Tait
Grace wants to know, should I sell my gold jewelry?
Grace: I keep some different pieces of gold jewelry in my jewel box. Every now and then I think about selling. But when is the right moment to sell gold jewelry?
Maria: Grace, tell me a bit more about your jewelry. What do you hide in your jewelry box? I can better understand your situation, if I know what we are talking about.
Grace: Of course. I see some gold rings with colorful stones. I see a necklace, earrings, cufflinks, some brooches, a bangle, and different accessories. Most items look old-fashioned to me. Furthermore I see two women’s watches and a huge cross. I wouldn’t wear this jewelry anymore, Maria. I sent you 2 photos of my gold jewelry. Maybe it’s helpful for you.
Maria: Yes, I received your photos. Thank you. It’s always better to see what you plan to sell to give you a recommendation. And I agree, we speak about old-fashioned jewelry. But what is the right time for selling? Well, for some people the right time is if there is cash needed. You don’t need cash but maybe you sell it short before X-mas, Eastern or the holiday season. The amount of your gold is small. Therefore the gold price fluctuation within some months doesn’t affect your value significantly. If you own huge amounts of gold, you have to follow the price fluctuation and you have to wait for rising prices to raise your profit.
Grace: I understand. But why are so many people talking about investing in jewelry. And is there a parallel to my gold jewelry too?
Maria: Financial experts always recommend to invest about 10% of your capital in gold or other precious metals. They do it these days and they already did it 10 years before. And Grace, if we speak about investing in gold, we speak about coins, ingots, bullion and bars. These items are sellable all over the world to individuals and banks as well. The purity of “investment gold” mostly shows at least 22K, very often also 24K. Gold jewelry comes with purities in the range of 14K and 18K gold and jewelry is not so easy to trade like investment gold. Your old-fashioned jewelry is no investment gold. If you plan to invest in gold, I would recommend you to sell your jewelry because the achieved amount can be easily invested in gold products like coins or ingots. If you do so, you can get rid of your gold jewelry and you can become a real gold investor.
Grace: I understand. So jewelry is more a fashion thing than an investment. But Grace, is there no collector’s demand for vintage pieces?
Maria: To be honest with you, it’s very questionable if you can sell your gold jewelry to collectors. Our company stopped selling jewelry like yours. We melt such items down to feed the industry with new commodity. We contribute to protect the nature and our habitat. More gold recycling means less gold mining. Less gold mining means less use of machines and chemicals. If you sell your gold jewelry, you feed indirectly the recycling industry. Your gold can be used to produce some coins or maybe new jewelry.
Grace: That’s a very special point of view. But I understand what you mean. If ten thousands of people like me would sell their unused gold, the industry could cover their demand for gold just by using recycled gold, right?
Maria: Yes and no. Your way of thinking is correct. But the demand for gold is giant. It’s not only the jewelry or investment industry asking for gold. The automotive industry, the electronic industry and also the medical industry is in need of gold, silver and other precious metals. But if lots of people like you would sell their unwanted gold, we could obtain a noticeable demand for mined gold.
Grace: You opened my mind for new thinking. I will sell my gold jewelry because I really have no need for it. Maybe I contribute a little bit for protecting the environment.