Is Gold Jewelry a Good Investment?

Humans have been obsessed with gold for thousands of years. Even today, having gold jewelry is a symbol of status and financial wealth. People rush to the jewelry store to get their hands on necklaces, rings, earrings, and anything else they can wear to boost their self-esteem.

Despite its popularity, however, is  gold jewelry a good investment? In this post, we’ll cover everything you need to know about gold jewelry and whether it’s worth the money.

Humans and Gold: One of the Strongest Relationships in History

Without a doubt, gold is one of humanity’s most valued resources. Throughout history, world leaders and entire civilizations have risen and fallen to own just a fraction of the world’s gold. From its immense beauty to its resistance to decay, gold is (and arguably will always be) a potent and unwavering symbol of wealth, beauty, and immortality.

The first human encounter with gold is currently unknown, but we know from the archaeological record that the fascination goes back thousands of years. Early human civilizations would likely have found gold in caves or flowing down rivers before anyone ever thought to mine it in any systematic way.

The gold bug was already in full effect among the ancient Egyptians, around 3,000 B.C. The Egyptians considered gold to be a sign of divine power and therefore incorporated it into their temples. Pharaohs lusted for gold and even created mines and maps to search for precious metals.

During early human history, mining and prospecting for gold took an immense amount of effort. The Egyptians, Indians, Chinese, and other civilizations resorted to slave labor and prisoners to work in the gold mines. Today, we are still on the hunt for gold, but mining and prospecting have become more sophisticated.

Gold as a Status Symbol

woman picking gold jewelries

When people think of gold, they usually picture high status. If you look at how gold is used in our culture today, it’s no surprise that we still have an extreme desire for it. Whether it’s a Rolex, gold iPhone, gold membership, or gold card, we can’t escape our love for this precious metal.

There’s something about gold that gives us the feeling of exclusivity. This is probably due to the historical association of gold with the world’s most powerful figures in the world, who tend to flaunt it as a sign of their social and political prowess.

Gold Jewelry and Celebrities

It’s almost impossible to spot a superstar who isn’t wearing some form of gold jewelry. Whether it’s a gold chain, watch, or set of teeth, celebrities love to rock gold to show off their status. Consequently, many people buy gold products in an attempt to grab a little of that spotlight for themselves.

Gold Jewelry as a Gift

Everyone loves getting that special someone a valuable present from time to time. Some might say the value of a gift doesn’t matter, only the thought of the person giving it. However, there’s no doubt getting someone gold jewelry will make a lasting statement.

What About Gold Jewelry as an Investment?

While it’s to no surprise that we love to wear gold on our bodies, can gold jewelry be more than just a fashion statement? Because gold is a valuable asset, is owning gold jewelry a sound investment strategy?

Gold seems to retain its value over time, even when the stock market is fluctuating. However, if you’re looking to flip your gold jewelry, you would need to invest in a substantial accessory to make any serious cash. Although investing in gold can be an excellent way to diversify your portfolio, gold jewelry isn’t the most powerful form of gold investing.

That being said, having gold jewelry in your collection can still be a smart move. Many people in Eastern countries such as China and India have extensive gold jewelry collections. Amassing a collection of gold jewelry can work as an emergency stash for a rainy day.

Not only is gold an excellent way to hedge against market volatility; it’s also an untraceable asset you can use when you don’t have any paper cash. Some of the advantages of buying gold jewelry as an investment are:

Some of the disadvantages of gold jewelry as an investment are:

  • You have to physically store it somewhere safe when you’re not using it
  • Gold doesn’t generate passive income
  • Can be difficult to sell above what you initially paid for it

How to Buy Gold Jewelry

Now that you see that investing in gold comes with several benefits, how do you buy gold jewelry properly? For starters, you want to make sure you’re getting your products from a reputable source. In light of gold’s value, there are a lot of scammers and inferior suppliers you need to be wary of.

Understanding the Purity of Gold

You may already be familiar with the term “24-karat gold,” but what does that actually mean? When it comes to purity, 24-karat gold is 100% pure. Karats are the little numbers printed on a piece of gold measuring its purity. The karat can also determine the type of gold in the product.

For example, some gold pieces contain other metals like copper and nickel. The more karats a gold piece has, the purer it is. The most common gold pieces contain 9, 10, 14, 18, 22, and 24 karats. It should come as no surprise that 24-karat gold pieces are more valuable because they contain more gold.

The Different Types of Gold

different types of gold rings

When we think of gold, we typically picture its iconic yellowish shiny appearance. However, gold can come in several colors. Whenever buying gold jewelry, you must understand the different gold colors available:

  • Yellow Gold – Yellow gold is the most common type of gold. Yellow gold has a honey-like appearance and is commonly used in rings, bracelets, necklaces, etc. However, there’s a lot of jewelry out there that takes on the appearance of yellow gold but doesn’t contain any.
  • Rose Gold – Rose gold became extremely popular with the release of the rose gold iPhone. This type of gold has a pinkish color and is commonly used in engagement rings.
  • White Gold – One precious metal that’s more valuable than gold is platinum. White gold was created to imitate platinum products. It looks similar to silver but is slightly brighter and more durable.
  • Green Gold – Without a doubt, green gold is one of the rarer colors. It has an almost emerald hue and is extremely difficult to find in traditional shops. As you may have guessed, green gold is incredibly expensive and typically only made in labs.

Finding the Right Vendor

Once you have an idea about what kind of gold you’re after, you must find a reputable vendor. If you live in the United States, there’s likely a reliable gold shop somewhere in your town. If you want to be 100% certain your gold is legit, you can go to large commercial suppliers like Tiffany’s, Cartier, and Graff. However, commercial vendors typically charge much higher premiums.

You can look for independent dealers, but be sure to look through their customer reviews online before buying or selling your gold to them. Any legitimate shop will have clear policies and fees and will charge a fair premium.

Another option is to buy gold jewelry online. While it is easy and convenient, it comes with a risk. That’s not to say that you can’t find high-quality gold products on the internet. If you do choose to buy your gold online, always go with a site that has online reviews. Try to avoid open marketplaces like Craigslist or eBay as you can’t always check for authenticity.

Is Gold Jewelry Right for You?

As you can see from the information above, investing in gold jewelry can be a wise decision. However, it’s certainly not for everyone. If you’re looking to make a lot of money fast, you should probably stay away from gold altogether. Gold is typically used as a stable investment strategy to hedge against stock market volatility. It can also be a good emergency stash to rely on during uncertain times.

If you can afford a gold chain or ring and you want to flaunt your status, by all means, hit up your local jewelry store. Whether you want to invest in gold jewelry solely depends on your goals. However, be sure to only buy something you can afford and avoid purchasing gold jewelry on credit.

Final Thoughts

There’s no doubt that humans have a deep connection with gold. Its appeal shows no signs of diminishing anytime soon. Gold Jewelry is extremely cool and can potentially be a good investment for some. If you’re looking for other ways to invest in gold, feel free to browse through our other related posts.

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