Selling Your Gold For Cash – How, Where and Beware

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With gold prices rolling past record highs on a regular basis, a number market pundits feel that we are entering a gold bubble.  Like the housing and financial bubbles many have gotten swept away with the lure of easy money, only to coming crashing to earth when the bubble pops. So if you have golden trinkets, jewelery or coins that you want to sell for cash, consider selling sooner rather than later. Here are some of the more popular options and pitfalls to be aware of :

Selling via Mail-In Operations

Through this option you mail in your gold and they mail you back a check. Companies like GoldPaq, GoldKit and Cash4Gold are among the companies offering this option.

Pros: It’s easy – they send a prepaid envelope, you drop in the gold, and they mail a check with an itemized receipt and a promise to return your gold if you’re not happy with the price.

Cons: You pay a price for convenience. Consumer Reports found that mail-in companies offered between 11 percent and 29 percent of the meltdown value of the gold.

The bottom line: Understand the trade-offs you’re making, says Paul Montgomery, president of the Professional Numismatists Guild. “The guys on TV are providing a service, but they’ve got a very, very high expense rate. They’re spending literally millions on advertising — and that’s (part of the reason) you might get just 20 or 25 cents on the dollar.”

Hotel and Gold Expo Shows

Companies using this channel to buy gold advertise heavily on local television, stating they’ll be at a hotel or convention center near you and will offer “top dollar” for your gold.

Pros: Sometimes these operations will buy more than just your gold – if you have collectibles, you may be able to sell them at the same time.

Cons: The limited-time engagement can encourage high-pressure sales tactics and little recourse if you feel duped. Their high travel, rent and advertising expenses mean you’ll rarely receive more than 40 percent of scrap value.

The bottom line: Do your homework, know a fair price and wait for the pitch, says David Morgan, publisher of Silver Investor in Colbert, Wash. “You’ve got gold jewelry, they’ve got cash. Everybody’s happy, right? Everybody except the people who know they have a bracelet that, when melted down, is worth $100, and they’re offered $40.”

Jewelry and Coin Shops

With the strong demand for gold and other precious metals it seems everyone’s buying these days, so you won’t struggle to find a shop willing to buy.

Pros: You’ll tend to get the most for your money at your local jeweler or coin shop – up to 70 percent of the gold’s value. If you have finely crafted jewelry, they’re also more likely to pay more for the jewelry itself, rather than just offering you cash based on the scrap value.

Cons: Many jewelers are catching on to the fact they don’t need to offer the best price for the gold and that customers will be none the wiser.

The bottom line: “If a dealer tries to tell you that the offer is only good until you walk out of the store, walk out of the store,” says Montgomery. “Go shop. If you walk back in the next day, the dealer will still want to buy your gold.” Finally, if you shop around, go to all shops on the same day, since gold prices can fluctuate substantially.

Home Gold Parties

It’s just like a Tupperware party, but instead of going home with plastic and a hole in your wallet, you sell your gold and take home cash.

Pros: It’s fun, social and perhaps the only multilevel marketing program where you leave with more money in your wallet than when you arrived.

Cons: Don’t expect to make a mint. In addition to the company’s cut, the party’s host will probably snag a 10 percent commission. Not all the party hosts will be gold pros, which means your gold may not be evaluated fairly.

The bottom line: Is it fun? Definitely. Is it profitable? That’s questionable. Expect to get 50 percent or less than what your gold is actually worth. “It comes down to this,” Montgomery says. “Do you trust the person you’re doing business with?”

Pawnshops

Business is up at pawnshops since the economy tanked, but also since gold prices soared. They’ll test your gold for authenticity and then offer a price.

Pros: If you suddenly decide you really didn’t need to swap that brooch from your grandma for a few bucks, you can usually buy it back, although at a higher price.

Cons: Pawnshops aren’t always in the best area of town, which can be a deterrent for some sellers, and there’s no guarantee you’ll earn top dollar.

The bottom line: “You wouldn’t sell a car, boat or any other asset without doing some homework and learning about what you’re doing,” says Montgomery. “If something doesn’t seem right, it probably isn’t.”

 

The scoop: Seductive advertising and the lure of easy money have drawn in thousands of eager sellers. You mail in your gold and they mail you back a check. GoldPaq, GoldKit and Cash4Gold are among the companies offering the service.

The benefits: It’s easy — they send a prepaid envelope, you drop in the gold, and they mail a check with an itemized receipt and a promise to return your gold if you’re not happy with the price.

The drawbacks: You pay a price for convenience. Consumer Reports found that mail-in companies offered between 11 percent and 29 percent of the meltdown value of the gold.

The bottom line: Understand the trade-offs you’re making, says Paul Montgomery, president of the Professional Numismatists Guild. “The guys on TV are providing a service, but they’ve got a very, very high expense rate. They’re spending literally millions on advertising — and that’s (part of the reason) you might get just 20 or 25 cents on the dollar.”

Read more: 5 ways you can sell old gold jewelry and coins for easy cash money http://www.bankrate.com/finance/personal-finance/sell-old-gold-for-cash-money-1.aspx#ixzz1L2daPyfo

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1 Comment on "Selling Your Gold For Cash – How, Where and Beware"


Ripley
Sunday 4:51 pm
Education helps. For instance, gold and silver are measured in troy ounces. It is 31.1 grams per troy ounce, compared to 28.4 grams per avoirdupois ounce, so a troy ounce is slightly less than 10% heavier than a “regular” ounce. Pure gold is 24 karat. Sterling silver is 0.925 fine (92.5% silver). Pre-1965 U.S. dimes, quarters, half dollars and dollars are .900 fine (90%). You can follow precious metal prices at kitco.com and apmex.com. among other places. I’ve both bought and sold with APMEX, and I’ve been happy with them. If you MUST sell on eBay, find out what your jewelry is worth and sell it as a “Buy It Now” item, or at least set the initial bid to something that you would be happy to get. You will lose about 8% of your sales price to eBay’s selling fees and PayPal’s fees. An easy place to cheat the… Read more »
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