Cash for Gold - Don't fall for the scams

You have probably seen the TV ads: Send in your gold jewelry and get back some cash. You really can recover gold by melting down gold jewelry. It's called scrap gold and it always sells for less than the spot gold price because it takes some time and expense to evaluate, melt, and recast the gold. The going rate these days is about half the spot price.

But people who respond to those TV ads - where they send you an envelope, you fill it with jewelry and mail it to them, then they send you cash - are getting as little as 5% of the spot gold price. The "guarantees" they brag about are no help. They say you'll have ten days to return the cash and get your gold back, but the fine print often reads, "ten days from the date on the check." Consumers have been complaining that these companies write the check, hold it a few days, then mail it. This leaves people with only a day or so.

So how do you sell your gold without being taken advantage of? Visit local pawn shops and gold coin dealers. A lot of them buy gold and the advantage of dealing with them is that you walk in the door with your gold, wait while they test and weigh it, then they make you an offer. If it's a good offer, you can walk out then and there with a lot more money than you would have gotten from one of those scams. If it's not a good offer, you can walk out with your gold and go somewhere else.

Before you go, do a little homework first. If you have a good idea of what your gold is worth, you'll be able to tell the good offers from the bad ones. You'll need to weigh the gold, a digital postage scale will work great for this, and you'll need to know how many karats it is. Fourteen karat gold is about 50% pure, so 1 oz of 14k gold is about half an oz of pure gold. But you don't have to do the math yourself. Once you weigh the gold go to the Scrap Gold Calculator, select "Troy Oz" from the drop down menu at the bottom of the page, fill in how much of each karat of gold you have, then press the "calculate" button. You'll notice that they can't recover every last bit of pure gold and there is a $100 refining charge. So 1 oz of 14k gold might get you a little over $210, but 2 oz of 14k gold would bring in $770 - either way it's much more than those TV cash for gold outfits would give you.

To really get the most for your money, there is the do it yourself approach. Yes, with a propane torch and a crucible, you can melt your own gold. Google for "how to melt gold" and look for results from Wiki and eHow for instructions.