Gold jewelry holds value based on purity, weight, and the current market price of gold. Knowing how to calculate its worth ensures fair transactions, whether selling or using gold as collateral for a loan in Scottsdale, Arizona.
What Does “Karat” Mean?
Karat (K) measures gold’s purity. Pure gold is 24K, but most jewelry contains a mix of gold and other metals for durability. Each karat level represents a percentage of pure gold:
| Karat | Purity | Description |
| 24K | 99.9% gold | The purest form of gold, soft and prone to scratches. |
| 22K | 91.6% gold | Common in fine jewelry, especially in Asia and the Middle East, with enough strength for everyday wear. |
| 18K | 75% gold | A balance between purity and durability, popular for high-quality rings, necklaces, bracelets, and more. |
| 14K | 58.3% gold | A strong, affordable choice, ideal for high-carat diamond engagement rings and other fine jewelry. |
| 10K | 41.7% gold | The most durable and least expensive gold jewelry, commonly used for everyday pieces. |
Higher karat jewelry contains more gold, therefore, its market value is higher. Meanwhile, lower karat jewelry mixed with metals like copper or silver costs less.
Knowing what karat means prevents undervaluation when selling or pawning. Jewelers stamp karat markings on jewelry, but professional appraisals are often necessary to confirm a piece’s purity. Some older pieces wear down, affecting accurate readings.
Recommended reading: Guide to Jewelry Maker’s Marks (How to Avoid Fake Jewelry)
How to Calculate the Price of Gold Jewelry
This section will brief you on estimating gold’s price based on weight, purity, and market value.
Step 1: Check the Current Gold Price
Gold prices fluctuate by the second based on supply, demand, and global economic conditions. Websites that track commodities (e.g., KITCO or Trading Economics), financial news sources, and bullion dealers display live gold prices per troy ounce (31.1 grams). Spot prices give a baseline but do not mirror transaction costs. Buyers pay below spot prices due to refining and resale expenses.
Step 2: Weigh the Gold Jewelry Accurately
Weighing gold ensures a fair calculation. A digital scale with at least 0.01-gram precision works best. After finding the weight in grams, multiply it by the purity percentage.
For example, if a 14K necklace weighing 10 grams contains 5.83 grams of pure gold: 10g × 58.3% = 5.83g of pure gold
Remove non-gold elements when weighing chains, bracelets, earrings, or rings with gemstones. Many jewelers use professional tools to weigh gold separately.
Step 3: Convert to Market Value
To find the value, convert grams to troy ounces (divide by 31.1) and multiply by the current gold price.
For example, if gold trades at $2,000 per troy ounce, the price per gram is: $2,000 ÷ 31.1 = $64.31 per gram
Using the 14K necklace calculation: 5.83g × $64.31 = $374.92
This demonstrates the raw gold value. However, buyers may offer less due to refining costs and profit margins.
Importance of Weight in Gold Jewelry or Bullion
There are two reasons why weight matters, including to get higher offers when:
Selling Gold Jewelry
Higher karat jewelry sells for more because it contains more gold. Dealers test purity before buying. Some use acid tests, electronic testers, or X-ray fluorescence scanners to confirm purity and weight. Keep in mind that selling jewelry as scrap gold brings lower payouts than selling pieces with artistic or brand value.
Gold jewelry buyers consider other factors than purity and weight, too. Designer brands, antique or estate pieces, and limited-edition jewelry may hold premium value. Most jewelers pay more for branded items from Tiffany & Co., Cartier, or Harry Winston. Handmade or rare vintage gold jewelry sometimes commands higher prices than its raw gold weight suggests.
Borrow Against Gold Jewelry at High Prices
Pawnshops and gold loan companies assess gold purity to determine loan amounts. Lenders usually lend 60 to 80% of the gold’s value. Lower karat jewelry results in smaller loans due to its reduced gold content. Some lenders refuse 10K or lower because of minimal gold content.
Lenders evaluate market trends before issuing loans. Gold prices fluctuate, affecting borrowing power. High gold prices mean higher loan amounts. When gold prices drop, lenders offer less or reduce loan-to-value ratios.
Pawnshops and specialized gold loan businesses differ in pricing methods. Pawnshops base loans on weight and karat, while gold loan companies consider international gold prices.
Common Mistakes When Selling Gold Jewelry
Avoid costly errors. Learn the top mistakes sellers make and how to get the best deals for your gold pieces below.
- Ignoring market trends: Gold prices shift daily. Selling during a price dip results in lower payouts.
- Accepting the first offer: Comparing multiple buyers secures better prices.
- Selling to unverified dealers: Some buyers undervalue gold or deduct excessive refining costs.
- Overlooking non-gold value: Jewelry from well-known brands or rare pieces should bring higher prices than scrap value.
- Not checking the scale: Some unscrupulous buyers manipulate scales to show lower weights. Don’t fall for it. Invest in a digital scale beforehand.
Also read: How to Take Advantage of Gold’s Record-High Prices
Spot Price vs. Retail Price
Gold’s spot price refers to its raw market value. Retail gold jewelry includes design, craftsmanship, and brand markups. A new 18K gold bracelet may cost thousands at a jewelry store but fetch far less when sold as scrap gold.
Luxury brands charge premiums for branding and exclusivity. Secondhand markets value jewelry differently, sometimes based on demand rather than weight. Vintage or rare gold pieces can exceed scrap prices.
Impact of Gold Alloys on Pricing
Lower karat jewelry contains metal alloys, which affect color and durability. White gold, green gold, and rose gold are products of mixed metals like silver, copper, or palladium. These alloys influence resale value. White gold, for instance, often contains rhodium plating, adding cost but not increasing gold weight.
Furthermore, some buyers prefer certain alloys over others. Antique gold jewelry with unique metal compositions sometimes brings higher prices. Regional preferences also affect demand. In some Asian countries, pure 24K gold holds strong market value, while Western buyers favor 14K and 18K jewelry.
Selling Scrap Gold vs. Jewelry
Selling scrap gold is different from selling finished jewelry. Gold refiners buy broken, outdated, or unwearable jewelry at near-spot prices, while jewelers, collectors, or secondhand luxury markets sometimes pay more for intact pieces.
Scrap gold sales revolve around metal content, with buyers melting pieces down for reuse. Intact jewelry, especially from known brands or with unique designs, may fetch higher prices based on craftsmanship and demand rather than just gold weight.
Takeaway
Knowing a little something about gold’s purity, weight, and pricing helps when selling or using jewelry for loans. Checking the weight, calculating pure gold content, and staying updated on market prices lead to better transactions.
Where to Sell or Pawn Gold in Scottsdale, AZ
Where else than Biltmore Loan and Jewelry—Arizona’s trusted jewelry buyer. We accept jewelry as collateral, too. Request an online appraisal here or visit us at 10830 N Scottsdale Road. Walk in with gold jewelry, walk out with cash in hand.