Gold prices have surged during the pandemic, reaching record levels as high as $2,058 an ounce in August 2020, and settling in roughly around the $1,850-1,900 mark more recently. Overall, gold prices are up almost 22-25% compared to before the pandemic. Yet, gold and gold jewelry remain the best options both for investment and gifting. Why?
From an investment perspective, gold is typically seen as a “safe haven” asset in times of uncertainty and a safer way to store your hard-earned money because gold is less volatile than stocks. It is also unlikely to shutter its doors, lay off employees and make your investment worthless like some public companies have done lately (e.g. Brooks Brothers, J. Crew, Century 21, etc.).
In times of uncertainty, “gold is a way of going long on fear.” Those are not my words, but those of investing guru and the CEO of Berkshire Hathaway, Warren Buffet. And I think we can all agree that he knows a thing or two about investing and making money.
Aside from being a good investment in uncertain economic times, the purchase of gold jewelry for gifting is wise in both the short and the long term. At the outset of the pandemic, gold jewelry was viewed as a luxury, but as we embrace our new reality of working from home and with the holidays upon us, what better way to memorialize surviving 2020 than a permanent memento in gold for one of your loved ones. What better way to show your undying love that with fine jewelry
Gold plated, gold leaf, gold filled, gold overlay, or gold vermeil jewelry items are great as fun pieces but other than your immediate gratification, they have little to no investment or resale or long-term value. Keep that in mind when buying jewelry items made out of any of these materials.
What to Look for When Purchasing Gold Jewelry
Whether you are purchasing fine gold jewelry online or in-store, the design, price, skin tone compatibility (since jewelry often - but not always - rests on skin), comfort and overall value are the relevant criteria you ought to be considering before any purchase.
But first, what is “fine jewelry”? Fine gold jewelry is solid gold jewelry that is 14 Karat or higher in purity. Look for the “K” or “karat” stamp or numbers (999, 916, 750 or 585) if you want to buy fine gold jewelry. These stamps denote the measure of purity of the gold and are required by the Federal Trade Commission to prevent consumers from being misled.
Choose Jewelry You Like
I cannot emphasize this enough. Before evaluating the different karats, their characteristics and respective criteria, it is critical that you always choose jewelry you or your gift recipient will like to wear and often (if not every day). It is my fervent belief that buying fine jewelry just to keep it in a safe or jewelry box is a shame. Fine jewelry is the only investment I know that you can wear to enhance your god-given gifts. My mantra is, “You can buy stock and bonds, but you certainly cannot wear them.”
My own preference is for timeless pieces of jewelry, but even if you can afford to buy a trendy piece of fine jewelry, it never really loses value. If the design becomes obsolete, you can always trade it in, trade it up, sell it, or have it refined and recycled for use in a new piece. A number of artisanal jewelry designers, especially those who hand-make gold jewelry are happy to use your old gold to craft into a new piece.
Choose Jewelry That is Comfortable if Intended for Daily Wear
A related aspect of fine gold jewelry is how comfortable it is to wear. There is no better compliment than seeing your loved one wearing your gift of jewelry every day. The more comfortable and functional it is, the more likely they are to wear it on a regular basis. Some things to look out for when comfort is paramount:
💎 Earring designs that are very heavy such that they will pull or extend the ear lobe.
💎 Necklace chains that have a tendency to pull the hair on the nape of your neck (for example, herringbone, omega link, snake link chains have a higher tendency to catch even the fine hair on the back of your neck).
💎 Thick earrings posts if your holes are newer - they could make your earlobes red and even infected.
💎 Any jewelry that has a tendency to snag your clothes.
Jewelry that is not comfortable to wear or you cannot put on or take off on your own often ends up in the safe or jewelry box.
Different Gold Karats and Their Particular Attributes
With the issue of design/style and comfort settled, let’s explore the different types of gold jewelry available and their respective features.
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Jewelry with the mark “24K” or “999” stands for 99.99% pure gold.
Characteristics: Very soft metal so not ideal for setting gemstones like diamonds, rubies or sapphires, which can fall off with relatively minor bumps. The prongs that hold the gemstones can bend easily causing your diamond or other gemstone to slip off unnoticed. Scratches easily due to the metal softness.
Price: Expensive because of the high level of gold purity, but also has a high resale value.
Skin Tone Compatibility: Metal color is a deep yellow and is best suited for warm skin tones like Mediterranean, Indian or Black skin tones.
Best Jewelry Item: Solid Gold heavy jewelry like thick rings, bracelets or necklaces.
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Jewelry with the mark “22K” means the jewelry item contains about 91.6% pure gold mixed with alloys. The stamp “916” also stands for 22k gold purity.
Characteristics: Not as soft as 24K but still has the tendency to scratch and bend easily.
Price: Almost as expensive as 24K gold.
Skin Tone Compatibility: Metal color is a dark yellow and is best suited for warm skin tones like Mediterranean, Indian or Black skin tones.
Best Jewelry Item: Although less soft, 22K gold is also better used for solid gold jewelry because it has the same issues with gemstones as 24K gold.
- Jewelry marked with “18K” or “750” is 75% pure gold and 25% alloy.
Characteristics: 18K gold is commonly used for fine jewelry due to its hardness. Diamonds and other precious stones set in 18K gold are pretty sturdy and have a smaller chance of getting loose out of their settings. Metal is not as soft as 22K and can withstand everyday wear and tear well.
Price: Expensive but not as high as 24K or 22K and depends on whether it has diamonds or other precious or colored stones.
Skin Tone Compatibility: Metal color is a medium yellow. Although warm skin tones like Mediterranean, Indian or Black skin tones wear 18K well, it also highlights a nice tan on caucasian skin.
Best Jewelry Item: Rings, bracelets, necklaces, earrings in solid gold or with gemstones.
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Jewelry that has the mark “14K” or “585” is 58.5% pure gold and 41.5% alloy.
Characteristics: 14K gold is ideal for fine gold jewelry that is put in every day or daily use. Due to its hardness, diamonds and other precious stones can be set well and durably in 14K gold.
Price: Popular gold due to its relative affordability and robust resale value.
Skin Tone Compatibility: Metal color is a light yellow. Ideal for medium to light skin tones.
Best Jewelry Item: Rings, bracelets, necklaces, earrings in solid gold or with gemstones.
The million dollar question then is what kind of jewelry should you be buying to ensure the best bang for your buck? The bigger the brand name, the more $$$ you will spend, sometimes even for pieces that are not technically “fine jewelry” because they are either gold plated, gold filled or vermeil. Typically, gold-plated or gold vermeil jewelry has low to zero resale value, unless they are luxury name brands like Gucci, Chanel or Dior. These luxury brands have some resale value, and remember - the selling platform takes a hefty chunk of it especially. As a buyer, if you wish to purchase second hand, then your best bet is to buy from pre-owned websites EBay, The Real Real, Etsy and others.
Whatever your budget, buying fine gold jewelry to be able to wear today, tomorrow and still have it be worth at least the same or more in the future makes better dollar sense, especially in a pandemic where you simply need to make your dollars work harder for you.
