Tag Archives: Consumer Reports

What is a Fair Price for Old Gold?

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When you decide to sell old gold jewelry, one of your chief concerns is to get a fair price. With the price of gold going higher every day, it would seem like you would be able to get a decent price for your scrap gold no matter where you go to sell it. Unfortunately, this isn’t the case.

There are a couple of issues that you need to be aware of when you decide to sell your old gold. First, there are definite costs involved in recovering the gold from whatever piece it is currently in. Buying, refining and selling all have costs associated with them, and each company along the way needs to make a decent profit.

The key thought here is that they deserve a decent profit. According to a Consumer Reports investigation, some Internet gold buyers are paying as little as 11% of the spot price of gold for the items people are sending in. That’s indecent to the point of being scandalous. In their article, Consumer Reports suggested that 50% was a reasonable offer. To give you an idea of how low the Internet guys are, our offers start at 60%, with 63% being closer to the average we round up to. Basically, they will pay you one-sixth the amount a local gold buyer like South Kansas City Gold Buyer will.

Second, as the old saying goes, knowledge is power. Many gold buyers will try to cloud the issue by using obscure systems of measurements (like pennyweights) that no one but a jeweler can use or weigh. Others will give you a quote by Troy ounce (which is different than a regular ounce) or by the gram. To us, the clearest and most direct way to quote a price is by the percentage of the spot price we will pay. And anybody you call can do that, even if they won’t admit to it. That’s how all of us get the price per pennyweight, gram or Troy ounce. We use some percentage off the spot price. If a buyer won’t tell you what percentage they are paying, move on.

So when you comparison shop, compare apples to apples. Ask for the percentage they are paying. And get a fair price for your old gold.

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Are Internet Gold Buyers Safe?

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Don't ship your gold - sell locally

Shipping your old gold to an Internet gold buyer may seem quick and convenient, but in reality, it is very costly.

Selling your old gold isn’t something most people do very often. For most of my customers, it’s a one time event. They go through their old gold jewelry and pick out a few pieces they don’t use in order to turn it into quick cash. Even though there can be significant money involved, a lot of people don’t want to spend a lot of time investigating the ins and outs of the gold buying industry.

In many ways, the Internet has made a lot of things more convenient. I do my banking and bill paying on line. There are a lot of things that I buy online. The savings in time, gas and energy makes these activities worthwhile. Sometimes, it’s a little bit of a hassle to wait for an item – like a book – to be shipped. But if I can pay half the price for the same book as I would get at a local bookstore, why not?

But selling your old gold isn’t like buying books online. There are a lot of factors to consider and a lot of variables that come into play. In my opinion, it’s always better to deal with someone face to face. It may seem convenient to order an envelope, pack up your gold,  drop it into the mail and then wait for a check. But how do you know that the check you get back is what your gold was really worth?

In all honesty, you don’t.  So why use the Internet buyers? Many people don’t want to go to their local gold buyers and spend the time shopping. Some people think first of pawn shops – who have long been traditional buyers of jewelry – and they don’t like the treatment or atmosphere. They like the idea of the convenience of doing the whole business by mail. But that convenience has a price.

In November 2009, Consumer Reports investigated the Internet gold buyers. What did they find? That they were offered between 11% and 29% of the value of their gold. You can read their article Cashing in gold? Here’s the catch. on their website. By comparison, South Kansas City Gold Buyer payouts are usually in the 60% to 65% range. That’s quite a difference.

Should you sell your old gold jewelry through the mail? Consumer Reports doesn’t think s0. Neither do we. Take the time to find a reputable, local gold buyer. You’ll be much happier with the results.

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