Gold and other precious metals trade in a very liquid market – that is to say, there are lots of people buying and selling all over the world at any given time.
This means their prices can quickly change, as has happened over the last week. When markets move up and down like that, some people can end up selling too low or buying too high.
To avoid this, personal finance expert Fanny Snaith recommends doing due diligence and getting some no obligation free valuations rather than selling jewellery in response to “just some advert”.
She also says sellers should consider the price of the jewellery might not just be the metal but the stones and design as well. This is why research and more than one valuation matters.
Financial advice charity National Debtline, external says anyone selling jewellery – or anything else – to pay off debt should make sure they own it first.
A person is not the owner of jewellery they are making payments for under a lease, rental, hire-purchase or bill of sale agreement.
The charity says in some cases, a lender may agree to give you permission for a sale, but you wouldn’t receive the full value of the item.
If a piece of jewellery is jointly owned by two people, the permission of both owners is usually needed in order to sell it.
The charity also recommends looking into different ways of selling jewellery to find the best way to sell the item.
The charity says it is important to consider the downsides to selling as well as the upsides.
The big upside is the ability to at least partially pay off creditors. But selling jewellery now, it points out, also means no longer having that asset for the future, including retirement or as a family inheritance.
“If you have financial emergencies in the future, you may not have enough money or assets to deal with them,” the charity adds.