What to Look for When Buying Gold Jewellery in India

India loves the precious yellow metal. Our obsession for gold is a world-renowned fact, one that needs no debate. And when we say we love buying gold, it most often means gold jewellery. For the average Indian gold buyer, it is not only an investment but also a precious fashion accessory. And we love to flaunt it every chance we get, don’t we? An Indian woman’s attire and her wardrobe are never incomplete without some or the other form of gold jewellery in it.

On an average, Indians, both in India and around the world, are among the top consumers of gold jewellery. The number of jewellery stores speckled across India is a testimony to this. As a population of gold lovers, we believe we have mastered the art of buying gold jewellery. But is this belief true? Not really, especially when we consider the quantity of impure gold jewellery doing the rounds in the Indian gold market. Most often, people find out to their surprise that they are fooled into buying impure gold jewellery at the cost of high-purity jewels. To buy real gold jewellery and avoid losing money on your investment, read on.

The Dos of Buying Gold Jewellery

As a gold-loving nation, the mention of the yellow metal catches our attention. This often also distracts from doing the due diligence required to buy gold jewellery. In the rush to buy gold at the best rates, it’s quite common to make mistakes. However, remembering the dos of buying gold jewellery can ensure that you get the worth for your investment.

Check the purity: The first step is to check for the purity of gold used to make the jewellery you have your eyes on. The best method to check for purity of gold is to find the hallmarking on the piece of jewellery. A hallmark carries the official proportion of gold used. The official agency responsible for certifying and hallmarking gold jewellery in India is the Bureau of Indian Standards (BIS). So, when you buy gold, always go for BIS-certified gold.

Know the Basics: Now that you know you have to check for a BIS hallmark, how do you go about reading it? Any jewellery with a hallmark comes with a specific number usually engraved with the BIS stamp. It also carries the year of hallmark and a mark to identify the jeweller. To understand what the caratage is, find the letter “K”. This denotes karat or the percentage of purity. For example, if you are buying 22kt gold rings, it means they contain 91.6 % pure gold. You will often find 916 engraved in jewellery featuring this caratage. Stone-studded ornaments and white gold and rose gold ornaments typically come in 18kt gold, which contains 75% pure gold.

Cross-check the price: As important as checking the hallmarking is cross-checking the pricing. The purity of gold determines its price. The price of the precious yellow metal changes every day depending on the prevailing market rate. Jewellery stores across India display the daily rates of bullion for their consumers. To give you an idea about how to calculate the price of gold, discount the purity of gold from the price of the bullion.

Negotiate the Making Charges: Another important step while buying gold jewellery is to negotiate the making charges. Making jewellery involves a labour cost, which jewellers pass on to the buyers. The making charge varies as it’s generally a percentage of the present gold price. You have all the rights to bargain to get the best price on your choice of jewellery.

The Don’ts of Buying Gold Jewellery

Now that you know the dos, keep the don’ts in mind too to get the best bang for your buck. Here are a few things you should consider:

Plain gold vs. stone studded jewellery: The first is to avoid buying stone-studded jewellery – such as diamond earrings, ruby bangles, and emerald rings - if you are buying it as an investment. The problem with stone-studded jewellery is that it’s difficult to assess the purity of the stones. If you insist on buying only studded jewellery, check the net weight of gold and pay accordingly. Studded jewellery also incurs more making charges as their intricate designs and patterns are labour intensive.

Cheap doesn’t mean the best: There are more than 13,700 BIS-hallmarked showrooms in India. And there are 435 BIS-recognised hallmarking and assaying centres too. However, there are many areas of the country without any hallmarking centres. Another area of concern is the integrity and quality of some of the hallmarking centres, especially in rural India. This brings us to a related point - don’t buy a piece of jewellery from a store if it’s cheap but not hallmarked. This makes it very important for you to buy ornaments only from a trusted, BIS-hallmarked jeweller. To make your life easy, the BIS website carries an extensive list of the hallmarked jewellers in the country. You can also contact BIS if you are not satisfied and still have concerns regarding a future purchase.

Don’t resell to other jewellers: We Indians have this habit of buying new ornaments by exchanging old ones. It’s best to avoid selling your gold jewellery to any store other than the one you bought it from. Most jewellers have a buy-back policy which ensures you get 100 percent of the net value of gold. However, you will almost always have to drop the making charges from the resale value.

Don’t buy jewellery without bills: Buying jewellery is not an easy task. You have to pay taxes and if you make a purchase of above INR 50000, you may even have to share your PAN details. As a result, many people buy jewellery without a bill from the store. This can land you in trouble, especially when you exchange the jewellery or resell it. Always, we repeat it, always ask for a bill.

Indulge in your love of gold with a little caution and a lot of preparation. Keeping these dos and don’ts of buying gold jewellery in mind will ensure you get the most out of your investment, now and every time.

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