When gold prices are high, and you’re sitting on old jewellery, bullion, or inherited pieces, it might be the perfect time to cash in. But before you sell, understand this: the gold-buying industry has its share of sketchy operators who count on your lack of knowledge. If you don’t do your homework, you could lose hundredsor even thousandsof dollars.
Here’s how to protect yourself and get a fair deal when you’re looking to sell gold in Canada.
Know What You Have
Start by identifying the type, weight, and purity of your gold. This is fundamental.Gold items are typically stamped with hallmarks indicating karat purity, commonly 10K, 14K, 18K, or 24K. Each karat level reflects the percentage of pure gold in the item: for example, 14K is 58.5% gold.
Use a jeweller’s loupe or magnifying glass to inspect stamps. Weigh each item on a precision scale that shows grams. Don’t rely on what a potential buyer may tell you. Know your karats and separate items accordingly; never let anyone weigh them all together.
If you have coins or bullion, research their current market value. Coins from the Royal Canadian Mint may carry numismatic premiums that exceed melt value, making them more valuable than simply how much they weigh.
Understand the Gold Priceand What You’ll Actually Get
The spot price of gold is a global benchmark, but you will not get the spot price when selling to a dealer. Buyers pay you a percentage of the spot price, factoring in their costs and profit margin. For scrap gold, you can generally expect to receive 60% to 90% of spot, depending on the quality of your piece and your negotiation skills.
Make sure you know the current rate per gram for the purity you’re selling, then do the math yourself:
- Multiply the item’s weight in grams by its purity percentage.
- Multiply that number by the current price per gram.
That’s your approximate melt value. Use it as a baseline in negotiations.
Avoid Mail-In Gold Services
Many Canadians have fallen for the convenience of mail-in gold offers. You send in your jewellery in a prepaid envelope, and days later, you’re offered a payment. By that point, your items are already out of your hands.
Even if the company says they’ll return the items if you decline their offer, they may charge you a hefty fee to do so. Worse, unless they’re insured and willing to accept responsibility, there’s minimal recourse if your package is ‘lost.’
It’s always best to sell gold in person and keep it in your possession until you sell.
Vet the Buyer
Don’t walk into the newest “We Buy Gold” storefront. Look for established businesses with a permanent location, proper business licenses, and a strong online presence.
Check reviews on Google and other local review sites. According to the latest data, about 74% of consumers check more than one site when researching businesses. See if the seller discloses its payout rates and testing methods online. If they don’t, ask them directly; reputable buyers won’t hesitate to explain how they calculate your payout.
Avoid any dealer who:
- Doesn’t weigh and test items in front of you
- Refuses to break down their offer by item
- Pressures you to accept on the spot
Consider an Appraisal
If you’re unsure of an item’s value, especially for antique jewellery or high-end pieces, paying for an independent appraisal may be worth the cost. A certified appraiser won’t buy your gold, so there’s no conflict of interest. They’ll help you determine if your item is worth more as-is than it is for melt.
Knowledge Is Leverage
Selling gold isn’t difficult, but it’s easy to do so poorly. The more you know, the harder you are to exploit. Arm yourself with basic facts, verify weights and purity, compare offers, and steer clear of questionable dealers, and you can turn your unused gold into real moneywithout getting fleeced in the process.