Is gold jewelry considered an investment? Experts weigh in

The price of gold rose dramatically in 2024, eventually reaching $2,790 per ounce in October before moderating slightly. This consistent uptick in price has sparked new interest in gold investing, with some people considering the addition of gold jewelry to their investment mix. 

But turning gold jewelry into a smart investment isn't as simple as it might seem. Below, industry experts discuss what makes jewelry different from other gold investments, and add insight into whether it can be a worthwhile portfolio addition.

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Is gold jewelry considered an investment? Experts weigh in

Many serious investors prefer gold bars and coins. But gold jewelry may offer unique potential — provided that you have careful buying strategies and realistic expectations.

The case for gold jewelry as a solid investment

"Gold [jewelry] can be a great investment if you buy it for the right price," says Matt Harris, a consignment jewelry and gem expert at Curated Fine Jewelry. He recommends looking for plain gold pieces such as chains, rings and bracelets through consignment shops, private marketplaces and pawn shops. You may find prices just slightly above gold's spot price.

Unlike standard gold bars and coins, jewelry offers potential value beyond its metal content. 

"The design, craftsmanship quality and brand name can influence the value of gold jewelry," says Ashleigh Trent, personal lines director and co-founder of Tower Street Insurance. Well-made pieces from respected designers may appreciate even if gold prices stay flat.

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Understanding gold jewelry's investment limitations

It's common for retail stores to mark up gold pieces by 100% over wholesale costs, according to Harris. This means gold would have to double in value just for you to break even.

And the challenges continue when selling. For example, the "we buy gold" shops usually buy gold jewelry for 30% to 50% below its spot value. They offer considerably less because they need to refine the piece, and of course, profit. These markups and resale difficulties make gold jewelry a complicated investment choice.

What to look for in gold jewelry as an investment

How can you tell whether a piece of gold jewelry holds investment value?

Trent and Ruhee Rathod, director of finance and operations at Bario Neal, break down five characteristics to look for:

• Higher purity levels: Look for 18K gold (75% pure) or higher. The purer the gold content, marked by higher karat numbers, the more valuable the piece. Avoid gold-plated (GP) or gold-filled (GF) items.
• Classic designs and brand reputation: Choose timeless styles over trendy pieces. Traditional designs from prestigious brands hold value over time.
• Proper documentation: Seek certificates proving the gold's purity and the piece's authenticity, especially for designer jewelry.
• Solid construction: Heavier, denser pieces contain more gold by weight. Since gold is usually valued by the gram, substantial pieces often make better investments than delicate ones.
• Clear origins: Traceable jewelry with documented sources tend to command higher prices.

Other smart ways to invest in gold

Besides jewelry, Bario Neal's Rathod highlights several gold investment options worth weighing:

• Gold IRAs: Roll over an existing 401(k) into a gold IRA to diversify your retirement savings. These accounts offer secure storage in guarded facilities and often include insurance protection.
• Gold ETFs and mutual funds: Buy shares in gold-focused funds for an affordable investment method without storing physical gold. These options work well when gold prices are high but you want smaller investment amounts.
• Physical gold: Purchase gold coins or bars through authorized dealers. This traditional approach gives you direct ownership of the metal. Physical gold is one of the best inflation hedges. The downside is you'll need to arrange secure storage.
• Precious metal certificates: Get certificates from trusted bullion banks representing gold ownership. You can exchange these for physical metals later, avoiding immediate storage concerns.
• Mining company stocks: Invest in gold mining companies for indirect exposure to gold prices. This option can offer higher returns but comes with more market risks than owning physical gold.

The bottom line

Gold jewelry can offer beauty and value. But before buying gold in any form, know the risks that could affect your investment. Rathod advises consulting a financial advisor first to determine whether jewelry fits your portfolio goals.

While gold jewelry might not match the investment potential of bars or coins, choosing well-documented pieces from reputable sources can provide financial and personal value. Just remember to keep detailed records and focus on the long term — gold jewelry works best as a slow, steady investment you can also enjoy wearing.