Gold.

It’s kind of a big deal these days.

It used to be that gold jewelry was something that lived in your underwear drawer until the end of time.  Now it seems if you have it, and you don’t want it, why not sell it? Cash for gold!  It’s the new American dream.

So when I started this project of selling my stuff to pay off debt, I immediately raided my dresser drawers to see what gold goodies were inside.

I had a pair of 14K hoop earrings that were given to me by a relative when I was a teenager. The tiny hoops don’t fit around my earlobes, so I’ve never worn them. I also had this 10K opal ring, and a 14K chain and pendant given to me by an old boyfriend.

You’d think this task of selling my gold would be an easy one, given the plethora of establishments on every street corner willing to buy it these days.  But it wasn’t, for one main reason, I didn’t want to get milked.

You may have heard the stories, gold buyers making a killing by giving consumers way less than fair market value. No one likes the thought of getting taken. I know I certainly don’t.

Unfortunately, researching the topic online didn’t get me very far. Those gold buyers have the corner on search terms related to selling your gold, making it quite difficult to find reputable advice.

So I figured the best way to learn was by doing. Here’s what I learned in my quest to sell gold without getting scammed.

Knowledge is king.

You’ll need to know three things before you begin.

1. The karat value of your gold
2. Its weight (usually in grams)
3. The current market value of gold

The karat value is usually stamped onto the gold itself, inside the band of a ring, or on the end cap of a bracelet or necklace. If you have a magnifying glass, you might be able to see it.

To find out the weight of your gold jewelry, a digital food scale might do the trick.

But if you don’t want to go through the rigors of figuring out exactly the karats and weights of your pieces, do what I did, and take them to the pawn shop. Just be sure to wear your flack jacket.

You can find out the current gold value simply by doing an internet search.  I used the calculators on Gold Price.org.  You can type in the weights and karats of your pieces, and they’ll tell you the market value. They even have an iPhone app.  Be sure to check it on the same day you’re planning on selling, the price fluctuates from day to day (as I learn later on in this post).

What if your gold jewelry has stones?

Most places will count the weight of your stones with your total gold weight, which might work to your advantage if your stones aren’t valuable on their own.  I did encounter a few gold buyers willing to remove stones free of charge if you want to keep them.  Others charge a fee to remove them, which sort of defeats the purpose.

Your options for selling are many.

Retail gold buyers.  That’s pretty much all they do is buy your gold.

Small independent jewelry stores. Sometimes they’ll buy your jewelry then turn it around and resell it.  Other times they’ll scrap it and use it for its gold value.

Large jewelry stores.  The big boys have started playing the gold game too. Are you in the market for new jewelry? Sometimes you can trade in your old pieces to go towards the cost of something new.

eBay or Craigslist. You can either sell your pieces individually for what they are, if there’s a market for them, or sell them collectively as “scrap gold.” Do your research to find out if these are good options for your specific pieces.

How much can you expect to get from gold buyers and jewelry stores?

The pawn shop offered me about 30% of the market value of gold. I’ve heard that retail gold buyers offer about the same. An independent jeweler offered me 40%.

Will these places negotiate?

Most of the time, yes! If you walk in and they utter those magic words, “what were you hoping to get for this today?” that’s your cue they’re ready to party, negotiate away!

One buyer all but begged me to haggle with him. But I’d had a long day and was only in the “gathering information” phase, so I didn’t partake in the fun (though looking back, I should have).

My advice: try to talk them up to 50% or 60% of the gold market value (you just checked it before you walked in the store, didn’t you?)

[Post Edit: According to reader Katie's comment below, 70% - 80% is more like it. Go for the gold! Pun absolutely intended :)]

That being said, there are some places that will not negotiate at all. But it never hurts to ask.

The end of my story…

The best offer I was given for my three pieces of jewelry was $120.  That was from the independent jeweler who tried to get me to negotiate, so I possibly could have gotten more.  But alas, I walked away with intentions of visiting a larger jeweler to see if the experience would be any different.

A few weeks later, I checked the price of gold again, and saw that it had gone down.  But at this point, I was too impatient to wait for the market to go back up. So I trekked down to the larger jewelry store, promising myself I would haggle – and I did!

They didn’t haggle back. Party poopers. I knew I didn’t want to invest any more time in this project, so I took their $100 check, and called it good.

Ironically, the value of gold spiked way back up by the close of the markets on that very day.  And it’s climbed higher since. Oh well, at least I got $100 and learned some lessons along the way.

Final thoughts.

Don’t be afraid of being scammed. Knowing what you have is half the battle. Check out yelp.com or ask around for reputable places that buy gold.  Be ready to negotiate. Or not. You can always walk away if you don’t like their offer, and there are a ton of other options. Have a little fun with it and don’t worry too much about getting the best deal – it’s not the end of the world if you don’t.

And finally, good luck!

Readers, have I missed anything?

[A special thank you to Crystal at Budgeting in the Fun Stuff for including this article as an editor's pick in her edition of the Festival of Frugality]

(photo credit)

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