If you have a significant jewelry collection at home, consider selling it to make some quick money. With the cost of living crisis in full swing and household bills skyrocketing, many people are trying to make ends meet. And if you're looking for extra income, selling valuables such as gold and silver jewelry is a great option. But only if done right.
Precious metals like gold and silver are always in high demand, meaning you will never struggle to find a buyer willing to take them off your hands. And although this vast amount of choices can seem overwhelming, it works in your favor. There are several reputable gold and silver jewelry buyers out there who will evaluate your items fairly and give you the best possible price.
But while there may be so many options for making money from your jewelry, not all are advisable. Selling to reputable jewelry-buying businesses is a great way to earn money, but pawning your valuables is risky and could result in a bad deal.
The following blog article looks at the top four reasons you shouldn't pawn your jewelry and why it's a much better idea to sell it instead.
What's the Difference Between Pawning and Selling?
If you've never sold your jewelry before, you may wonder what the difference between selling and pawning is and why the latter is such a bad idea.
When you sell an item, you exchange it for money. The piece of jewelry you have sold no longer belongs to you, but you now have an extra pile of cash in your hands. The amount of money you receive will depend on the buyer's valuation. Therefore, it's best to sell to a reputable business with a thorough and fair valuation process, like American Gold & Diamond Buyers in Northern NJ.
Pawning, however, involves using the item as security for a short-term loan. You may need money urgently to pay your rent or a utility bill. A pawnbroker will value your items and offer you a certain amount for them as a loan. They will then keep hold of your possessions until you have paid back the loan and any interest on it. If you cannot pay back the money, the pawnbroker can keep your jewelry and sell it to recoup their losses. The critical difference is that you still technically own your jewelry and will get it back if you repay it within the agreed timeframe.
Why Is Pawning Not a Good Idea?
Perhaps you are tempted to pawn your valuable items to get them back later, but there are better ideas than this. There are so many reasons why pawning jewelry is inadvisable, and selling your possessions can be much more lucrative and risk-free.
Here are the top four reasons to avoid pawning jewelry.
You Risk Losing Your Items
Ideally, you will be able to repay your loan once your paycheck comes in and you'll retrieve your valuable items. But what if your check doesn't come through, or you're suddenly hit with an unexpected expense? There's a chance you won't be able to pay back the money with interest within the agreed timeframe, and the pawnbroker will take ownership of your expensive jewelry. They may be reasonable and agree to let you repay the loan late, perhaps with added interest. Alternatively, you can repurchase the jewelry at an inflated price, but they may have already sold it, and you won't see it again.
You Will Ultimately Lose Money
All pawnbrokers charge interest on their loans - it's how they make money. But this means that once you have repaid your loan, you will be financially worse off than before. Yes, it allowed you to pay off your bills when you were short, but you still had to pay the money back plus interest.
They May Not Accept Your Item
It's not a sure thing that a pawnbroker will accept your items. If they are not deemed high value enough, or there is insufficient demand, they may not be willing to give you money for them.
The same issue could arise when trying to sell your item, but someone may present you with an offer to buy instead of pawning.
The Valuation May Not Be Accurate
To receive a fair price for your gold or silver jewelry, you must have it valued by an expert in that material. Most pawnbrokers deal with a vast range of items, so they are unlikely to have this specialist knowledge. You may receive an amount far less than its actual value.
What Should You Do With Your Jewelry Instead?
It's clear that pawning is never a good move, but what is the alternative? If you are willing to part with your jewelry in exchange for a significant amount, selling to a reputable jewelry-buying business can be a much more lucrative and safe option.
Selling to a jewelry-buying business, rather than pawning, means you will instantly receive cash for your goods that you won't have to pay back. As long as you pick a jewelry-buying business with good credentials and a team of experts who conduct fair valuations, you make much more than if you were to pawn your jewelry.
To find such a business, you should research various jewelry buyers in your local market. Checking online reviews will tell you what their past and present customers think of them and whether or not you can expect a fair price and quality service. If selling gold or silver, it's also a good idea to familiarize yourself with the current market value and its fluctuations, as this will help you to find the best price at the right time.
American Gold & Diamond Buyers
At American Gold and Diamond Buyers, we pride ourselves on offering our customers the fairest and best prices. If you want to sell your jewelry and make some extra income fast, get in touch today for a free valuation.