Selling Silver and Gold Jewelry

If your jewelry box or safety deposit box is like most, it contains rings that have lost their stones, odd lengths of chain and hideous outdated brooches. Your dining room, attic or basement may contain the remnants of a dented silver tea service or some battered sterling cutlery. You may even have a roll of old silver dollars or an entire coin collection handed down from a long-dead relative. During the course of their lives, most people amass a welter of odd bits of precious metal that are useless to their owners but are too valuable to throw away. In recent years, the price of gold and silver have reached dizzying heights, and the number of businesses eager to pay cash for your scrap silver and gold have increased dramatically.

Determining What is Scrap

Sometimes, an item may be of no value to you, yet still have the ability to fetch a premium from the right buyer. This is especially true when it comes to gold or silver coins; jewelry that includes diamonds or other gemstones; tarnished but otherwise good silverware; and jewelry that is gaudy or outdated. Before you sell any precious metal as scrap, search for similar items online and make sure that your trash is not some buyer’s treasure. If there is any possibility that anyone will buy your items to use or collect, you will get a much better price by selling them directly, either online or to a local jewelry or antique shop or to an individual.

Determining What Your Scrap is Worth

Generally speaking, the more research you do, the better price you will get for your old gold and silver. The most important things you need to know are the weight of your metal, the purity level of the metal in your items and the spot price of gold or silver. Once you have determined these three things, finding out how much you should expect to net from the sell of your metal will be as simple as doing a little research online or making a phone call.

Troy Ounces

When weighing your precious metal, it’s important to be aware that gold and silver are measured differently than cheese or steel. You may hear that gold and silver are going for a certain amount per ounce. In fact, spot price will almost always be expressed as a price per ounce. However, most precious metals, along with gunpowder, are measured in troy ounces. This is because the precious metals industry was already thriving and using the Roman system of measurement when the current ounce, called the avoirdupois ounce, was introduced. To avoid the expense and potential danger of transitioning to the new, smaller avoirdupois ounce, the precious metals market retained the troy ounce. A troy ounce is equivalent to 1.09714286 ounces. That’s nearly a tenth larger than a regular ounce. This is great when you are buying gold or silver, or gunpowder, for that matter, but it can be quite a blow to discover that you have 10 percent less valuable metal than you thought you had.

Purity

Gold and silver are often combined with other metals to make them stronger or cheaper to produce. In most cases, the actual weight of your items is not the same as the weight of precious metal it contains. It’s important to know how much gold or silver your gold or silver items actually contain. If you have coins, a simple online search will yield the information you need. For other items, you will have to look for markings. For example, if your item says gold filled, it may contain very little gold. Other markings mean other things. For example 24 karat gold is pure gold. It is relatively rare, since it is very soft and very expensive. Look for tiny stamps near clasps or the inside of ring bands, then search to find out the meaning of the markings. Online calculators can help you figure out how much precious metal you actually have.

Spot Price

For the purposes of selling scrap gold or silver, spot price can be defined loosely as the current price of the metal. A simple Internet search will net numerous sites that list spot prices. Spot price changes constantly, so make sure you check it right before you plan to sell your gold or silver. Knowing the current spot price won’t tell you exactly what your metal is worth. That will depend upon factors such as it’s metal content and weight, as discussed above. However, it will give you a baseline.

Buy vs. Sell Prices

Bear in mind that no business is going to pay you the going price for anything, since that would make it impossible for the business to make a profit on the transaction. Dealers must buy at below spot price and sell above spot price in order to ensure they can pay the cost of doing business and have a profit left over. Individuals who invest in gold therefore generally have to buy a little above spot price and sell a little below spot price. The difference between the price a dealer will pay and the price a dealer will charge for precious metal is called the spread.

Find the Lowest Spread

As a seller, your most important job is to find the lowest spread. One way to keep your spread low is to shop around. Look online and call around to various dealers. If you decide to sell online, don’t forget to deduct the cost of shipping and insurance from your earnings. In general, you should call several dealers and then check the reputation of the ones that offer the highest price. Unless your gold or silver is actually broken bits, consider selling it yourself through an online auction site or classified ad. You can often get spot when selling directly, and you can sometimes get higher than spot.

Online vs. Local Dealers

As a general rule, avoid pawn shops or places that feature the phrase “cash for gold” prominently in their names or advertisements. At best, these places usually expect to turn right around and sell your metal to a refinery at a profit. There are many buyers, both online and local, that count on finding sellers who don’t know anything about spot prices or purity levels. Some of these dealers occasionally step over the fine line between legality and illegality. For example, some of them will remove gemstones from their settings and pay you for the metal that is left, then sell the gemstones and pocket the profit.

Selling online often gets a better price, but you will not get paid immediately. Selling locally usually means walking away with cash in hand. However, this is not always the case, so call ahead and make sure the dealer doesn’t expect you to take a check. If you have bullion to sell, even if it is in the form of junk silver coins, a reputable gold and silver dealer is just as easy to find as a fly-by-night metals buyer and will be prepared to pay you a fair rate. Research any dealer before you sell, and keep your wits about you during the transaction. If anything doesn’t seem right or fair, don’t agree to the sale.