With the holidays coming up a few extra bucks would be nice. But it is not a good idea to take your gold and walk into a random storefront. To get the best price you need to know what your gold is worth before you leave your house and that's why we've put together this guide.
The gold business is booming with buyers and sellers, coins and jewelry. Perhaps you should sell, but how do you get the most money? We asked three gold dealers to check our jewelry and give us a price they'd pay.
Pacific Precious Metals was our standard. It checked for quality and quantity and offered us $371. Then our intern, Krista Williamson, goes undercover.
"I first went to Collectibles and Coins in Mill Valley," said Williamson. "I gave him the jewelry and he looked at it, and spent a lot of time with it and he priced it at about $371. And then we took it two West Coast Gold Buyers in San Mateo. She said it was $171."
"There is no standard that anyone follows as far as what you have to pay somebody right, everyone can make up their own price on for them, what it's worth to them," said Dan Barrett of Mill Valley's Pacific Precious Metals.
Barrett says this is a case not of buyer beware, but seller beware.
"Most people really don't know how to calculate how much gold they actually have," said Barrett.
So how do you know? Well, there is a formula to this: you take the weight x purity x spot x percentage = price. Weight is measured in troy ounces, purity in karats, spot is the going rate for gold that day, percentage is how much of that going rate the dealer will pay.
To get a ballpark figure, get out a kitchen scale - a cheap one is fine - and weigh your jewelry in grams. There are 31 grams to a troy ounce. Now look for the stamp on the jewelry: 24 karats is nearly 100 percent gold, making 14 karats about 58 percent. So for us: 1/2 troy (.50) x .58 = .29.
Now multiply that by the spot rate on this day of $1,620 and you get $470. Shoot for a percentage of 80 percent (leaving 20 percent for profit for handling) and the ballpark price for this jewelry is $375. Very close to the $371 offered by two of the dealers.
As for West Coast Gold Buyers, we asked why the difference in price and were told, "Not knowing the exact details of the transaction, it is difficult to give you an exact answer. One possible reason could be the buyer in the store you visited did not evaluate the items properly. We always offer a fair price and back it up with a 110 percent Price Match Guarantee."
"I learned you really do need on your own or with an expert find out the value of the gold. How much you have and how much it is worth before you go out and sell it because had I not known the gold was worth $371. I might have just sold it for $171," said Williamson.
So before selling your gold take a few minutes to weigh it and do the math.
So why did all three offers end with $71? There are two explanations: all three were using similar formula math or just coincidence.