In the bustling heart of London's financial district, towering skyscrapers cast long shadows, a testament to centuries of commerce and trade. Here, in the vaults deep below, big banks safeguard gold bars, their gleaming surfaces reflecting the legacy of wealth and power. To many, investing in precious metals might seem like a realm reserved for these financial giants, a world far removed from everyday life.
But is gold jewellery a good investment for the average consumer? The modern era has democratised this golden opportunity. No longer confined to vaults or exclusive dealers, gold investment has found its way to the fingertips of anyone with an internet connection. In this article, we'll unravel the intricacies of investing in 24k gold jewellery, weighing its pros and cons, and equipping you with practical tips to embark on your own investment journey.
Contents:
- The pros of investing in gold jewellery
- The cons of investing in gold jewellery
- Top tips for investing in gold jewellery
- FAQs about investing in gold jewellery
- Begin your investment journey
The pros of investing in gold jewellery
Gold has been considered a sound investment for thousands of years now, with its radiant allure making it a symbol of prestige for millennia. But prestige doesn’t pay the bills. To understand whether gold is a suitable investment for your purposes, let’s begin by uncovering the pros of investing in gold jewellery and, more broadly, the pros and cons of buying gold in general.
Durability and timelessness
Gold, in its essence, is resilient. While it is a malleable precious metal, unlike many other metals, pure gold will not oxidise or corrode. There are, luckily, very few acids that can harm gold, as opposed to other precious metals, which are more susceptible to acid damage.
While silver, another beloved metal, might be softer and prone to scratches, gold retains its form and brilliance even with daily wear. This combination of durability and intrinsic value makes gold a preferred choice for many who seek both beauty and longevity in their jewellery.
Complements all skin tones
Gold's warm hue is celebrated for its versatility, offering a universal glow to all skin tones. Whether your skin has cooler undertones or you're someone who tans effortlessly, gold jewellery accentuates your natural beauty.
This timeless metal has a unique ability to highlight and enhance the individual characteristics of each person, making it a cherished choice for many. We believe in the power of gold to elevate every look, ensuring that each piece resonates with the wearer's personal style and essence.
Authenticity and purity
In the world of precious metals, authenticity matters. The fact that real gold is easier to identify should ease the minds of those wondering whether buying gold jewellery is a good investment.
In the UK, gold must be stamped or marked to identify its purity. This hallmark informs the buyer of the exact percentage of gold in their jewellery.
Generally found on the inner band of rings or jewellery clasps, the stamp consists of a rectangular, oval, or house shape embedded into the piece. A rectangular shape with shaved corners indicates a gold piece, an oval indicates silver and a house indicates platinum.
Once this symbol has been located, you can refer to the number inside the shape to tell you the purity of the material used. While different countries follow different hallmarking standards, common hallmarks for gold include:
999: 24-karat gold 916: 22-karat gold 750: 18-karat gold 585: 14-karat gold
Real gold is also easy to identify, which means you don’t have to be a professional to know when a piece of gold jewellery is high in quality.
Minimal maintenance
Gold's enduring shine requires minimal upkeep. In general, gold jewellery requires far less care than other materials to maintain its beauty and charm. If you’ve owned any sterling silver jewellery, you’ve probably noticed that it can quickly become tarnished, brown, or even black as time passes. A quality polish and some elbow grease may help restore your silver to its original state, However, gold, especially in its purest form, remains luminous.
Impure gold does, of course, also have the potential to dull over time, but occasional cleaning, coupled with proper storage in a dry environment, ensures your gold jewellery remains bright and shiny for years to come. Or, you could invest in pure, 24-karat gold that never loses its lustre.
The cons of investing in gold jewellery
No investment comes without its own drawbacks and risks, and gold jewellery does come with its own set of challenges when viewed as an investment. Here, we delve into the potential pitfalls of investing in gold jewellery.
Higher initial investment
Gold's esteemed status makes it one of the pricier metals to invest in. While it does hold its value over time, the initial investment can be substantial. The fluctuating market value of gold, combined with the craftsmanship and design intricacies of a piece, can influence its cost. However, with 7879's transparent approach, you're always aware of your jewellery's worth based on its weight and the current market value of gold.
Market volatility
While gold generally retains its value, the market for precious metals can be unpredictable. Economic downturns, geopolitical events, or shifts in consumer preferences can influence gold prices. Investing in gold jewellery means being prepared for these market fluctuations and understanding that the resale value might not always align with initial expectations.
Liquidity concerns
While gold is a tangible asset, converting jewellery back into cash might not be as straightforward as selling gold bullion or coins. The resale value of jewellery can be influenced by factors beyond just the weight and purity of gold, such as design, brand, and current fashion trends.
It's vulnerable to physical damage
Gold, especially in its purest form, is a soft metal. This means that 24-karat gold jewellery, while exquisite, can be prone to scratches and dents when worn regularly. Metals like platinum might offer more resistance to wear and tear. So, while the intrinsic value of your 24-karat gold piece from 7879 remains intact, superficial damage might affect its resale value in the eyes of some buyers.
Top tips for investing in gold jewellery
Embarking on the journey of investing in gold jewellery is an exciting process. But while the allure of gold is undeniable, ensuring that your investment is sound requires a blend of knowledge, patience, and discernment. Here are some guidelines to help you navigate this path.
Prioritise authenticity
When it comes to investing in gold jewellery, authenticity is paramount. The market is rife with pieces that may appear genuine but are merely gold-plated or of inferior quality. To safeguard your investment, always source your pieces from reputable, transparent sellers.
Look for certifications and customer reviews on platforms like Trustpilot, and ensure the jeweller is listed in recognized directories or has an Assay Assured certificate. At 7879, we pride ourselves on the purity and authenticity of every piece, ensuring you invest with confidence.
Seek professional appraisals
Before finalising any purchase, it's wise to have the piece professionally appraised. This not only gives you a clear understanding of its worth but also ensures you're making a sound investment. While many jewellers offer appraisals, it's sometimes beneficial to seek a third-party opinion for unbiased clarity.
Insure your investment
Not to worry you too much, but accidents happen, and where money’s concerned, you need to guard against them. Gold jewellery, especially when viewed as an investment, should always be insured. Given the long-term nature of such investments, it's crucial to protect your assets against unforeseen circumstances. An appraisal, as mentioned earlier, will aid in this process, ensuring your piece is insured for its true value.
Understand the value of craftsmanship
While intricate designs and elaborate craftsmanship can elevate the price of a jewellery piece, they also add a labour cost that doesn't necessarily increase the intrinsic value of the gold. For investment purposes, consider pieces that require minimal craftsmanship, such as solid gold chains or bracelets. These items offer a more direct reflection of the gold's market value.
Be cautious with Diamonds
While diamonds have their own appeal, new diamond jewellery can depreciate quickly. It can also be more difficult to appraise the overall value of a piece when you have to consider both the value of the metal as well as the inlaid stones.
If you're considering pieces with diamonds, it might be more prudent to look at pre-owned or vintage items, which can offer better value for money and potential appreciation over time. Better yet, stick to the transparent simplicity of unadorned precious metals.
Invest in what resonates with you
While it’s wise to think of your investment in gold jewellery from a monetary point of view, don’t forget that the whole point is to own an asset you can appreciate. Beyond the financial aspects, investing in jewellery is also a personal journey.
Choose pieces that resonate with you; pieces that you'd be proud to wear or showcase. When you're emotionally connected to your investment, the journey becomes more fulfilling, and your decisions are better informed.
FAQs about investing in gold jewellery
Navigating the world of gold jewellery investment can be intricate, but with the right knowledge, it becomes a journey of discovery and profit. Here are some frequently asked questions to guide you through the process.
Which gold jewellery is best for investment?
The best gold jewellery for investment typically consists of pieces that are high in purity, such as 24-karat gold. These items retain their value better due to the higher gold content. Additionally, classic, timeless designs or pieces from renowned brands or artisans tend to appreciate in value over time.
Unadorned, solid gold items can also be a wise choice as they focus on the intrinsic value of the metal rather than intricate designs or additional gemstones. It’s easier to assess the value and agree on a resale price for these pieces.
When should I buy or sell gold jewellery?
The ideal time to buy gold jewellery is when market prices are relatively low or stable. Keeping an eye on global economic trends, currency fluctuations, and geopolitical events can provide insights into potential gold price movements.
When selling, it's best to wait for periods when gold prices are high, ensuring you get the maximum return on your investment. However, always consider your personal financial situation and consult with financial experts before making any significant decisions.
If you invest through 7879, you can track the value of your jewellery in your personalised portfolio, to clearly see when the time is right for you to sell.
Does gold lose value when you buy it?
Gold, as a tangible asset, doesn't depreciate like cars or electronics. However, when you purchase gold jewellery at retail prices, you're often paying for more than just the gold content. Craftsmanship, brand prestige, and design intricacies can inflate the price. While the value of the gold itself remains relatively stable, these additional costs might not be fully recoverable upon resale.
It's essential to differentiate between the value of the gold and the value of the jewellery piece as a whole. The easiest way to keep track of the value of your gold is to invest in pure, 24-karat gold; if you know its weight, you can track its value against global markets.
How do I verify the authenticity of gold jewellery?
Ensuring the authenticity of your gold jewellery is crucial. Genuine gold pieces will have hallmarks indicating their purity, such as "24-karat gold”. It's advisable to purchase from reputable sellers or brands that provide certification of authenticity.
Additionally, consider getting an independent appraisal for more expensive pieces to confirm both the gold content and the item's overall value. A goldsmith or jeweller who doesn’t have a stake in the sale should be able to tell you the current value of any gold piece you own.
Is it better to invest in gold coins or gold jewellery?
Both gold coins and gold jewellery have their merits as investment vehicles. Gold coins, especially those from recognised mints, have a clear and standardised gold content, making their value straightforward to determine. Gold jewellery, on the other hand, combines the intrinsic value of gold with craftsmanship and design.
While coins might offer more liquidity and less ambiguity in terms of gold content, jewellery provides the dual benefit of aesthetic enjoyment and potential appreciation due to design or brand prestige. Your choice should align with your investment goals and personal preferences.
Begin your investment journey
Gold’s intrinsic value, combined with its durability and universal appeal, makes it a sought-after investment. While the world of gold investment might seem daunting, with the right knowledge and guidance, it becomes an accessible and rewarding journey.
From understanding the pros and cons of investing in gold jewellery to discerning the best pieces for investment, it's essential to be well-informed. Prioritising authenticity, appreciating the value of craftsmanship, and connecting emotionally with your investment are key to a fulfilling gold investment journey.
For those ready to embark on this golden adventure, explore our curated collection of 24-karat gold pieces that not only resonate with the 7879 ethos but also promise enduring value. And if you're keen to delve deeper into the intricacies of investing, our comprehensive investment guides offer a wealth of knowledge to set you on the right path.