It is not difficult to calculate the approximate value of scrap gold, given a little investigation and research. By following the steps outlines, a reasonable estimate can be obtained.
Separate Gold By Quality
The first step is to determine the quality, or karat value, of each piece of gold, and then to divide the items into distinct piles. Most true gold items will have the karats stamped into the clasp, the inside of a ring or an earring post. This may require a magnifying glass, as some markings can be quite small. Separate each type into piles. The most common types are 10KT or 14KT, with 18 or 22KT less common. If unsure, place the item in the 10KT pile.
It is also important to verify that an item is actually solid gold. Gold plated or gold filled items do not have much actual gold content and most gold refiners will not accept them. One quick test is to pass a magnet over each pile. Anything that is highly magnetic is not gold. However, some clasps and closures may have a small steel spring in them, so a clasp that reacts to a magnet does not disqualify the entire piece. If unsure, leave it in the pile.
Weigh Each Group
Gold is priced by the Troy ounce, which is different than the standard ounce used in everyday measurements. It can also be measured in pennyweights or grams. The easiest way to determine how much gold you have is to use a scale that measures in grams. There are 31.1 grams to a Troy ounce of gold.
Determine How Much Actual Gold is Present
Jewelry is not made of pure gold. Other metals are added for color and strength, so the amount of actual gold is determined by karat. Since 24 karat is pure gold, dividing by 24 will give the proper percentage. 10KT gold is 41.7% gold, 14 KT is 58.3% and 18KT is 75%. Take the weight of each pile and multiply by the appropriate factor to determine how much gold is in each group.
For example: 25 grams of 10KT X .417 = 10.425 grams of actual gold
Check the Current Spot Price of Gold
The Spot Price is the current price for an ounce of certified 99.99% pure gold bullion. This isn’t the price paid for scrap gold, but it is a good starting point. This price changes minute by minute, but to get an idea of where gold is currently trading, check a web site like Kitco.com for the current price.
Once the Spot Price has been determined, divide by 31.1 to determine the current price per gram.
For example: $1,100 per ounce ÷ 31.1 = $35.37 per gram for pure gold
The next step is to multiply that price by 40% and 60%. This will give a range of acceptable offers.
For example: $35.37 per gram X .40 = $14.15 (low price) or X .60 = $21.22 (high price)
Determine What the Scrap Gold is Worth
Now, it is simply a matter of determining an acceptable price range. Continuing with the same example, if the Spot Price of gold is $1,100 per ounce, and there are 25 grams of 10KT gold, the math would be as follows:
Amount of gold: 25 grams of 10KT X .417 = 10.425 grams of gold
Current gold value: $1,100 per ounce ÷ 31.1 = $35.37 per gram
Low end offer: 10.425 grams X $35.37 per gram = $368.73 X .4 = $147.49
High end offer: 10.425 grams X $35.37 per gram = $368.73 X .6 = $221.24
With just a little effort and research, it is possible to get a rough idea of what price a particular quantity of scrap gold should fetch. This is not an exact science, and the buyer should be able to test and evaluate the scrap gold much more exactly. Also, there can be a fairly significant spread between the acceptible high and low prices, so it is vital to check with more than one buyer if the offer seems low. However, if the buyer can explain the math and point out any possible errors in calculations, it is good to be flexible. Knowing how to calculate the value of scrap gold should make it easier to sell with confidence.