Gold Jewelry Pricing - How Much Should You Pay?

When it comes to buying and selling gold jewelry as a customer, knowing what to pay is crucial to ensuring you get a fair deal and avoid being ripped off. Many jewelers mark up their prices significantly, often leaving customers paying far more than they should.

But how do you know what's fair? Figuring out how to correctly value gold jewelry might seem daunting, but it's actually very straightforward! This post is meant to serve as a quick yet accurate guide for you as a customer looking to buy gold jewelry, or interested in selling an old piece you have around.

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The Gold Price

The first thing to know is that gold is a widely traded global commodity whose price fluctuates everyday, kind of like a stock. The gold price is usually quoted in troy ounces, or more commonly by the gram in the case of jewelry.

There are many resources available online that can tell you the live gold price, such as goldprice.org , or this page on our very own site. 

The Gold Value of Jewelry

The price of every piece of gold jewelry has two components, the gold value (also known as melt value) and the premium. The gold value of jewelry is objective and is based on the world gold price at any given time. 

You can use our calculator here to figure out the objective gold value of any piece of gold jewelry. You simply need to enter the weight and purity of the piece, and the calculator will tell you how much the piece is objectively worth based on how much gold it contains.

 

The Premium

The premium is the second component of the price of gold jewelry. This is the amount that a jeweler charges you above the gold value of a piece. For example, let's say there's a chain or necklace that has a gold value of $1000, but the jeweler is quoting you $1700. That means he or she is effectively charging you a 70% premium for this piece.

Gold jewelry premiums are highly subjective and can vary widely from jeweler to jeweler. This is where many jewelers hope to prey on customers who are less informed. 

 

Calculating the Premium on Gold Jewelry

The math behind calculating the premium on gold jewelry is a bit more complex, however fear not! We at ThaiGold.com have created this calculator to help you figure out how much premium you're being charged for any piece of gold jewelry. You simply need to enter the weight, purity, and asking price of the piece you're being charged, and we'll tell you what percentage premium you're being asked to pay.

A good way to think about things is that the gold value acts as a sort of baseline or anchor for the value, and the premium is what's open for negotiation. Remember, jewelry shops have expenses like any other business and need to make a profit on top, but on the other hand you as a customer need to make sure you're getting a fair deal to avoid being taken advantage of. 

 

So What's a Fair Price/Premium to Pay?

This is a topic with a lot of nuance that probably deserves it's own post. But to keep things simple for today:

• You should avoid paying more than 50% in any circumstance, unless absolutely necessary, and not too much more than this.
• 30% is generally an acceptable offer. Depending where you are, you might need to shop around a bit for a jeweler willing to offer deals in this range.
• 15% is an amazing bargain that you should probably jump on. But be careful that you're not being scammed!
• 0% or less, you're most likely being scammed. Avoid, or proceed with very high caution.

 

What We Do

We at ThaiGold.com believe in offering you the best possible deals, which is why we sell most of our pieces in the 15-30% range. We also believe in radical transparency, clearly displaying the gold value and premium we charge on every single one of our items, something very few other shops and jewelers are willing to do. 

 

What About Selling Old Jewelry?

When it comes to selling old jewelry, you should generally strive to receive 80-90% of the gold value of the piece. For example, if you have a piece of jewelry that has a gold value of $1000, you should expect to sell it for $800-$900. Just use this calculator to figure out the gold value. 

You might be wondering why you'll need to settle for less than the gold value when it comes time to sell. The reality is it's difficult to find buyers for old pieces; people prefer to pay extra for new custom pieces tailored specifically to their desires. So what ends up happening is your old jewelry gets melted down by the jeweler to make new pieces - a process which bears more cost for the jeweler than simply acquiring gold that's ready to be worked on, hence why he needs to offer a bit less than the gold value for it. 

We hope this guide as been helpful in clearing up any questions you might've had regarding buying, selling, and valuing gold jewelry. Now you can go look around and shop with confidence!