SAN DIEGO (CBS 8) - With the price of gold topping $1,700 an ounce, people are jumping at the chance to cash in. Newspaper advertisements promise a $2,000 starting price, or spot price, per ounce, and offer thousands of dollars for 14-karat gold jewelry.
"In tough economic times like we're seeing, it's a good place for people if they have that laying around to turn that into cash and use it for daily expenses and so forth," Jeff Martin of John Franklin Fine Jewelers said.
News 8 sent a producer out with a 14-karat gold charm necklace to do a little comparison shopping. At John Franklin Jewelers in Kearny Mesa, first they weighed the necklace -- 40.8 grams -- and calculated a price.
"You're looking at $948," Martin said.
If we sold the necklace, it would be melted down and used to create new jewelry.
"The majority of gold jewelry being brought in to us and other gold buyers is 14-karat gold," Martin said.
At Coin Mart in Chula Vista, they actually tested the gold and originally offered us $775. But as we walked out, the offer increased for a final offer of $1,000, our highest bid of the day.
Many companies advertise in the newspaper, and operate out of hotel rooms, like Anderson, Carter and Bascom at the Hilton Garden Inn in Rancho Bernardo. Their offer was $888, a bit lower than the brick-and-mortar companies we visited earlier.
"These companies here, they just buy it, they pay cash, and they leave town," Martin said.
Finally, we went to the Holiday Inn La Mesa, were the company running the $2,000 spot price headline had set up shop. Secured Gold Buyers offered us just $554, the low price of the day. Our producer wanted to know why, and we were asked to leave. Later, we spoke to the CEO of Secured Gold Buyers on the phone. Ryan Knott told us the price quoted was a mistake.
"There was a miscommunication between our marketing and operations department," he said.
Knott said his company should have offered nearly twice as much -- $1,027. He claimed 15 other customers that day were shortchanged, and said he'll be cutting checks to correct the error.
"This calculation was not the right calculation and therefore the adjustments are being made and the customers are going to be paid exactly what we stated they would," he said.
So the best advice is to shop around, and go with the highest price. Don't be afraid to walk out to get a better offer. And remember, the price of gold fluctuates every day, so you might want to check that out before you sell your jewelry.
