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Obviously it’s a really good idea if you can work out how much your scrap gold is worth prior to approaching a dealer, so this page is going to explain how to calculate the value of any scrap gold that you may have.
There are 3 steps to working out how much your scrap gold is worth:
- Check what carat your gold items are.
- Accurately weigh how much of each carat of scrap gold you have.
- Calculate the value of your gold using the latest gold price.
We’ll explain exactly how to do that on this page.
What is the Carat Rating of Your Gold?
The purity of gold is measured in carats (you’ve probably heard it mentioned with regards to diamonds too), but most people don’t really understand what a carat (not carrot!) actually is.
Pure gold has a rating of 24 carats, and is the rating used in things like gold bullion bars. It is rarely used in jewellery (except in some Asian cultures), since it is far too soft. Usually gold has other metals added to it, usually copper or silver, which makes it harder and more durable.
If there was only one part gold to 23 parts copper, then the gold would have a rating of 1 carat (1ct), 2 parts gold and 22 parts copper would be 2ct gold, and so on.
The carat rating of any item made from gold then depends on what percentage of other metals are added to the pure gold, the higher the carats the better. In actual use, 22ct, 18ct, 14ct, and 9ct are all quite common.
To try to give this some meaning, 22ct gold has 22/24 parts gold, so is 91.66% pure; 18 carat is 18/24 parts gold, so is 75% pure, etc all the way down to 9/24 parts gold which equals 37.5% pure. The more pure your gold is, the more value it has for a given weight.
If your gold is hallmarked, which it should be if it is jewellery, then you should be able to simply look up the mark in a book or online. If not then you’ll really need to get an informed opinion.
Weighing Your Gold
The next thing to do is to weigh your gold. It is vitally important to get an accurate weight, so it’s no good using the bathroom scales or your kitchen scales, you need to use an accurate digital scale, which cost around £10 on eBay.
You also need to remove any stones and other non gold items, since we are concerned only with the weight of the gold itself. You also need to weigh different gold carats together, ie, all 22ct gold together, all 14ct gold together, etc – do not mix up the different carats!
Gold is traditionally measured in Troy Ounces (Oz), or in grams (gm), and some scrap gold dealers also use pennyweight measures. Most tend to use grams when dealing in scrap gold, since most people don’t tend to have ounces of gold, and gram is a smaller measure making calculations easier.
1 Troy Oz of gold is the equivalent of 31.1 grams, or 20 pennyweight. Make a note of the weight of your scrap gold in grams.
Calculating the Value of Your Scrap Gold
Now comes the fun part!
The easy thing to do is to multiply the weights of the different carats of gold by the prices quoted by different dealers to see how much you’ll end up with. For example, if a dealer is quoting £5 per gram for 9ct gold and you have 30gms, then you’ll get £150.
Simple. Well, not quite because of course you want to know if thats a good deal or not, so you need to work out the actual value of your scrap gold first, so that you can compare the 2 values.
To do this the first thing that you need to do is to find the current value of gold. You can see todays market price for gold below:
The quoted price is for 1 Troy ounce of 24ct gold, so next we need to find a way to measure 1oz of pure gold against our weight of not pure gold.
This is how to do it:
Firstly, divide the value of 1oz of gold by 31.1 to get a price for 1 gram of gold. For example, if gold was £450 per ounce, your calculation would be: £450/31.3 = £14.47p per gram.
Next, multiply the weight of your scrap gold by its carats, and then divide by 24. For example, suppose you have 50 gms of 9ct gold. The calculation would be: (50 x 9)/24 which equals 18.75.
This number, 18.75, is the number of grams of pure gold that your scrap gold contains.
Now simply multiply the amount of pure gold in grams by the price per gram and you have your value – in this case 18.75gms x £14.47p per gram = £271.30p
If you have scrap gold of different carats simply repeat the process substituting the different numbers as appropriate, and then add up the final values, which will give you the full market price for the gold content of your scrap gold – which you need to remember that you’re not going to get!
You can realistically expect to get maybe 85% to 90% of the actual value of the gold (remember that it needs to be melted down, etc, which all costs money), so your 50 gms of 9ct gold in the example above should net you between £230 and £245 – any more than that and you’re doing well!
At least you now have an idea of how to work out a fair ball park figure that you should achieve for your scrap gold, and you aren’t going to get robbed blind by some unscrupulous scrap gold dealer.
Good luck, and if you found our free site helpful then please link back to us!