Should you sell your gold?

Every day we are bombarded with adverts from companies wanting to buy our old gold jewellery. The price of gold is rising throughout the world and has hit $1,000 an ounce.
So should we sell now and how do we go about choosing the right company?
You can sell your gold at some High Street jewellers or use an online company where you send your items to them in the post. These companies will usually phone or e-mail you a quote which you can accept or reject but some will just send you a cheque which you need to return within a set period if you are not happy with the amount.
There are also gold parties and temporary units cropping up in shopping centres looking to buy your unwanted gold.
Some of the online and postal companies that have been around for years and also well known High Street jewellers are trustworthy in their dealings and you will get a fair price.
However some companies, such as the new ones advertising on TV, are only offering as little as20% of the value of the gold.
Gold dealing has become big business recently and many companies are forming just to make a quick profit and will close down just as quick when gold prices start to dip. These companies will care very little for fairness or customer service.
So before you sell your gold do a quick search on the company.
See how long they have been trading for and check online chatrooms and forums for any negative comments. If in doubt contact the Trading Standards to see if any complaints have been received. The current price offered can vary from £2 a gram to £7.30 a gram so it is worth shopping around. Remember the price of gold varies daily so your quotes will vary slightly from day to day.
There are alternatives to selling your gold. If you only need a short term loan you may be better going to a Pawnbroker. They will normally loan you half the value of your jewellery and charge in the region of 8% per month. This is not ideal for a long term loan.
Selling your old gold in the present climate can be a wise move, but be sure to do your homework on the company before you do.

Not many people benefit from the credit crunch; the pawnbrokers do

You would be excused for thinking that while the nation is hit by the credit crunch, everyone in the country is struggling. A fair assumption it may be, but an incorrect one it is.

While hard working Mr and Mrs Smith are struggling to pay their bills each month, their mortgage payments continue to creep up and finding money becomes harder and harder. Enter the pawnbroker. More and more of us are turning to the pawn shops as a method of supplementing our incomes.

For years credit has been freely available and we have accepted it without a second thought. We have taken out loans to buy TVs, DVD players, jewellery, games and other goods with value that we simply would not be able to buy today. So it makes sense that in times of hardship, we turn these goods into cash and short of selling them, pawning them is the next best thing.

Another industry which is booming at present is that of pay day loans but if you consider the cost of borrowing on these, you will see pawning your stuff can be a lot cheaper. Most pay day loan firms charge in the region of £20 for every £100 borrowed. In contrast, you could easily find a pawnbroker who would offer you a loan against your goods for somewhere in the region 8% or £8 for every £100 borrowed. Talking of pawn broking as a means to raise funds, Chris Tapp, director of debt charity Credit Action said “If you need a small amount of cash for a short time, like if your boiler breaks down, it can be a decent option”.

As with all credit, you should think seriously before entering into any agreement and if you cannot afford to buy the goods back in the short term, this probably isn’t for you as the fees will continue to build each month and the debt can escalate.

Before pawning, consider the alternatives. It is still an expensive way to borrow and if you find yourself pawning things on a regular basis, you need to find a more workable solution to your financial situation because it can be a vicious cycle that gets harder and harder to break.