5 things to keep in mind while buying gold this festive season

Considering the sentiment of devotion that Indians associate with gold during this time of the year, it’s all the more important to make sure that the gold you buy is authentic.

October 26, 2020 2:35 IST | India Infoline News Service
The festival of lights, wealth, and prosperity is just around the corner, and with that, our appetite for gold is bound to shoot up. Gold has a lot of religious and cultural significance for India, which is one of the reasons why India is the biggest importer of the yellow metal. People buy and invest in gold irrespective of age and income. Another reason for favoring gold is it acts as an excellent hedge against inflation and retains its value even during times of financial upheaval. Considering the sentiment of devotion that Indians associate with gold during this time of the year, it’s all the more important to make sure that the gold you buy is authentic. Keeping this in mind, given below are 5 things you need to keep a check on while buying gold.

1. Purity of gold: Gold purity is measured in carats. 24-carat gold is considered 99.9% pure whereas 22 karat gold is considered as 92% pure. Though 24K gold is the purest form of gold, it is not really suitable to be crafted out into jewellery due to its fluid nature. So, what is sold in the markets usually is 14K, 18K, or 22K gold. 22K, with 92% and 18K with 75% gold, make up for the most durable amounts to be crafted into jewellery along with adding alloys to it. So, always ask for the purity before buying this precious metal.

2. Cost per gram: You need to check the current price of gold. You can do this by checking multiple trustworthy gold websites to understand the price range for the piece of gold you are interested in. Gold prices keep fluctuating every day. In such a situation, all jewelers tell the daily gold rate to their customers.You must also look for the weight per gram as some buyers like to have precious stones like diamond, emerald, etc. beaded up in their gold jewellery. Therefore, one should make sure the gold is weighed separately while billing and not along with the beaded stones to avoid being overcharged.

3. Making charges: Keep in mind that the price of gold is not the only expenditure that you will have to bear in case of physical gold.You’ll also have to consider making charges which can be 8% of the gold price if not more. Making charges can also be contingent on whether it is man-made or machine-made. The more elegant and intricate design you get made, the more it will cost you.

4. Hallmarked gold: Always make sure that you check the hallmark on the gold. If a piece of jewellery has the BIS mark on it, you can rest assured that it is in line with the standards that have been set by the Bureau of Indian Standards.Do check for these four BIS hallmarking components before buying jewellery
• BIS mark
• Purity/fineness
• Assaying and hallmark centres
• Jewelers’ identification mark/number

5. Buy back terms: Apart from these, it is also advisable to get clarity over buy back terms for your gold. It doesn’t matter whether you have bought the gold from your jeweler, the Stock Holding Corporation of India, a non-banking financial company or online. In each of these cases, it is important to know the buyback terms. If you are selling your gold (in any form) to a jeweller, you are likely to get a lower valuation for the same as the jeweller will not pay for the making charges and the administrative charges. If you have bought gold from a bank, you are not allowed to sell it back to the bank as per directive of the Reserve Bank of India.
After you have ticked all these steps, ensure that you ask for a bill with your purchase. The bill should offer details of your transaction. Be a smart gold buyer this festive season and may the shine of gold dazzle your spirits!

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