Add glitter to your festivals
When buying gold this festive season, don’t let terminology confuse you. Keep you head on your shoulders to get the most out of your money.
As the festive season approaches with Vishu, Baisakhi and the Akshaya Tritiya, do you plan to head to the jeweller for auspicious gold buying? Here are some quick tips that would help you add sparkle to your gold-buying experience.
Check the prices through an SMS
Various associations such as the All India Gems and Jewellery Trade Federation (GJF) and the India Bullion and Jewellers Association (IBJA) offer the prevalent gold rates via an SMS and on their websites. The “buying” rate refers to the price the jeweller would pay for your old jewellery and the selling rate is the rate at which the jeweller would sell gold to you. Of course, jewellers add a mark up to this cost. So look for jewellers who offer a rate closer to this quoted rate.
New ways to mention Karats
Don’t compare a 750 gold rate to a 916 gold rate. These are nothing but measures of Karat. So, when you see “Gold-750” mentioned on your bill, the jewellery is 18 karats, while 916 refers to 22 karats.
Roughly cut bars
Unless you want to gift a gold coin to someone, you can purchase roughly cut bars instead of those embossed with figures such as Lakshmi Goddess. When we checked at the National Refinery for a rough cut bar, the price was Rs447 lower than the finished version of a 10 gram coin costing Rs29,987.
Schemes on making charges
Jewellers often stock select jewellery pieces (usually less intricate designs) where making charges are as low as Rs65-90 per gram. With more intricate items this can go up to about Rs350-700 per gram. Ask the sales person to show you such pieces. During festivals don’t miss out on offers such as “No Wastage” being offered on exchange of gold jewellery. Also, a per piece labour charge might work in your favour rather than a per gram charge.
Usually, the gold rate shoots up closer to the day of Akshaya Tritiya. Also, zeroing in on a piece becomes time-consuming as people throng jewellery stores and your browsing gets held up. Instead opt for offers such as locking in gold rates up to a week prior to the festival day. So, you can go and select the piece on April 28 if the gold rate has eased and lock in the rate of that day, even as the auspicious buying would technically happen on the Akshaya Tritiya day of May 1, 2014.
Preserve Bills of your old gold jewellery and head to the same jeweller to sell it as you would save on the wastage charges. You are more likely to fetch a better selling price at the shop where you purchased it from. There are marks on the jewellery specific to the stores and once the jewellery store identifies these, it is assured of the purity.
Avoid buying coins at banks
On a day when reputed jewellers were selling gold coins at Rs27,580-28,244 banks were selling these same 10 gram coins at Rs30,624 to Rs33,072.27 (excluding 1% sales tax). The bad news is that banks don’t buy coins back like jewellers do, so if you have bought a coin at the bank you have already lost 16-20% of its value.
Purchase e-gold, ETFs
If you are worried about the purity issue and want to do away with the hefty making charges, a better way to add a dash of yellow is through e-gold purchased via National Spot Exchange and gold exchange traded funds offered by mutual funds. You can buy as low as 1 gram at a shot. The good news is that though these are held in demat form, today there is a facility of redeeming the units into physical gold, provided you have accumulated a minimum of 8-10 grams. The delivery centres are limited today, but are expected to expand into deeper geographies.
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