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How To Calculate What Your Gold Jewelry Is Worth
Everyone have some old or out of style gold jewelry tuck away in some drawer that you probably wear once in a blue moon or not at all. Now is a good time to turn that gold into cash since the global economic turmoil has push the price of gold to record levels. But before you do that here is a quick explanation of how those buyers determine the price of that pile of jewelry before he hands over the cash.
A Few Facts You Need to Know before Selling Your Jewelry
Before you set off to sell your gold jewelry here are few things you need to know.
First, the price of gold is based on the unit of weight called a troy ounce (We all know that I hope). A troy ounce is a small amount of weight since we all know it takes 12 troy ounces to make one pound. But the buyer does not always measure the weight of your jewelry in troy ounces. Sometimes he measures it in a unit from the metric system called grams. This unit is strange to a lot of Americans since we are one of the few countries in the world still using the English system of measurements. If you are a technical person or someone who works in a scientific or mathematical profession you should not have any problem with the metric system. Anyway, a gram is even smaller than a troy ounce because it takes 31.1034768 or basically 31 grams to make one troy ounce. If your balance is displaying the weight in grams just multiply that number by 0.03215 to change it to troy ounces and if the balance is displaying your weight in ounces just multiply that number by 0.9116 to change the weight to troy ounces. You probably hope the buyer uses all the decimal places to the right of the period to get the maximum value for your jewelry laying on his balance.
Finally, make sure you take your jewelry to a reputable buyer. Get references from someone who probably been to the shop you wish to go to or if they can suggest one for you. Stay away from those fly by night places because I am sure a pretty few of them are popping up now since gold prices are at a record high right now just rip people off. Now let’s move on to the fun part, the calculation. Get out your slide ruler, calculator, or abacus. Believe or not there are some countries that still use the abacus to do their calculations.
Let me start with the simplest calculation. If you are one of the fortunate few who have 24 karat gold in your drawers, chest or whatever, this one is easy. If you happen to have a balance capable of measuring the weight of your jewelry in troy ounces just place your pile of jewelry on the balance and write the displayed number on a pad. Next, just multiply that number by the price of gold per troy ounce. Note “per” is another way of saying “for each” Here is example calculation. This is all elementary school math. Let’s said you have 4.54 troy ounces of gold on the balance and the price of gold per ounce is $1,635. For the sake of simplicity let 's use "ounces" for "troy ounces" from this point forward in this article.
Note: The calculated amounts below are how much your gold is worth before the dealer takes his share out of the calculated amount. The dealer's share can vary from shop to shop.
4.54 ounces X $1,635/ounce = $7,422.90
Now, if you had the exact same weight of jewelry but this time the jewelry is 18K, obviously you are going to get less than what you received for the 24K jewelry simply because there is less gold in the jewelry than in the 24K gold jewelry. Let’s do the math again. But before we can calculate the value the 18K must be changed to a ratio because 18K of course is not pure gold. It is 18 parts gold and 6 parts another metal combined such as silver, copper, or even zinc. For comparison 24K is 24 parts gold, no other metal is combined with it. Now let’s calculated the ratio of gold in the 18K jewelry.
Note: The buyer do not want plated gold jewelry or jewelry with stones embedded in them because he cannot determine an accurate weight of gold in the jewelry with all the other parts to get the real value of the gold.
18 parts divided by 24 parts = 0.75.
Another way of look at it is that 18K gold is 75% gold and 25% some other metal, while 24K gold is 100% gold since it pure gold. The next step is to calculate how much the 18K gold is worth based on that ratio. This is how it is done assuming the same weight of jewelry.
Step 1: 4.54 ounces X $1,635/ounce = $7,422.90
Step 2: $7,422.90 X 0.75 = $5,567.18
Your 4.54 ounces of 18K gold is worth $5,567.18. That is a nice piece of change!
For the other common karats of gold, 14K and 10K, the same calculate for ratio can be applied. However, the ratios will be different since the amount of gold in the jewelry is different. Let’s calculate the ratio for the 14K and 10K jewelries as illustrated in Step 1.
Ratio for 14K equals 14 parts divided by 24 parts = 0.5833 or 58.33% gold
Ratio for 10K equals 10 parts divided by 24 parts = 0.4157 or 41.57% gold
To determine how much 4.54 ounces of 14K gold and 10k gold would be worth for the weight. Let’s do the math by using the calculations from Step 2, since you already know 4.54 ounces of 24K gold is worth $7,422.90 if the price per ounce of gold is $1,635.
For 14K gold: $7,422.90 X 0.5833 = $4,329.78
For 10K gold: $7,422.90 X 0.4157 = $3,085.70
See it is really quite simple to determine how much money you should get for your pile of jewelry. Just pull out your trusted calculator and if you happen to have balance capable of weighing troy ounces do the math before you head to the gold dealer.
You will have a pretty good idea of how much cash you should receive for your departed jewelry. Just remember, first determine how much 24K is worth for that weight you see displayed on your balance and multiply that by the price of gold per ounce. Next multiply that number by the ratio for your 10K, 14K, or 18K jewelry. Also don’t forget to separate your jewelry according to the karats before weighing them. Good Luck!