If you own any jewellery or other items made of gold, you may have thought about selling some of it – especially if you have been prompted by any of the number of companies which have emerged over recent years offering to turn your “gold into cash”.
But if you are interested in this kind of transaction, there are some potential pitfalls to watch out for.
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Why have gold sales become more popular?
The main reason more people are selling gold – and more firms have been set up to help them do so – is that the price of the metal is historically at a high level.
Back in 2000, a troy ounce of gold was valued at around US$300 (about £200 at today’s exchange rate). As a result of the credit crunch and financial crisis, it is now trading at almost $1,200 per ounce (£790).
How much will I get for my gold?
When you sell your gold to a jeweller or trading company, the price you get will depend on the purity of the item and its weight (normally in grams rather than ounces). The official gold price, as discussed above, is based on “pure” 24-carat gold.
But bear in mind that your buyer will most likely offer less – probably far less – than the market rate in order to make a profit and to cover their costs.
It shouldn’t matter what state your jewellery is in, though – the buyers’ aim is normally to sell it on to be melted down.
Who will buy my gold?
You can take your gold items to a high-street jeweller in order to sell them – and a jeweller should be able to tell you exactly how much your items weigh and what their purity is.
But there are a number of online and postal services that will also offer to buy – you can find details of them via an internet search. These firms are unregulated, so seek recommendations from friends or other internet users where possible.
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How to sell
Once you know the item’s purity and weight, you can ask for several quotes and go for the best one.
Postal or online buyers require you to send your gold to them so they can give you a definitive price – this may be lower than you have already been quoted if they disagree with you over purity, for example.
Always make a record of what you send and take a picture. You should use Royal Mail Special Delivery, but you will need proof of your item’s value (such as a receipt) to make a compensation claim from Royal Mail if anything goes wrong.
Also, find out what happens if you reject the buyer’s final offer – will you have to pay for the items to be returned to you?