Is It Time to Cash In on That Jewelry Box?

GOLD and silver prices have fallen from the peaks they reached two months ago, but after five years of steady increases, they are still at levels that are spurring people to cash in unwanted jewelry for its scrap value.

In Patchogue, N.Y., one gold buyer, Jim Sarno, owner of Budget Buy and Sell, says customers have been hauling in jewelry boxes and emptying them onto his countertops. The sudden and unrestrained exhibition of personal belongings often means only one thing: the people are there to sell.

"If you aren't wearing your jewelry, you are losing money," said Lisa Hubbard, executive director of the international jewelry division of Sotheby's. "Focus on what the cash would do for you."

Scrapping gold for cash is an appealing option for those who are getting rid of odds and ends - like a single earring or a broken chain - and can be profitable, especially if you have an accumulation of castoffs. Outlets for sales range from local jewelers or gold buyers to smelters who advertise on the Internet; gold buying is highly competitive, and shopping around is advisable.

"Show the jewelry to two or three active buyers," suggested Russell Fogarty, a wholesaler at Kazanjian & Fogarty in Beverly Hills, Calif. "Buyers base their offering prices for modern gold items by first weighing them and determining the actual gold content. If the pieces are wearable and relatively desirable, the offer will be above the intrinsic value of the gold." But simple gold chains, he said, would go for less.

Keep in mind that prices offered by buyers are for pure material, and that nearly all gold, platinum and silver jewelry is made of alloyed substances that require the addition of other metals to make them strong enough to withstand daily wear and tear. Gold that is 14 karat is 58 percent pure gold, while 18 karat means 75 percent and 24 karat is 100 percent; the price paid will reflect the amount of actual gold that is bought.

Gold now sells for 3 an ounce, down from 5 in May. But that is much more than about 5 an ounce in July 2001. Jon Nadler, a precious-metals analyst at the bullion dealer Kitco.com, does not expect the price to fall below 0 an ounce, and he says it could hit 0 next year.

The resale market for antique and estate jewelry is so closely scrutinized for valuable items that much of what is sold for scrap is instead salvaged and sold as jewelry. "Even the smelters and scrap buyers are smarter than" to let some items be melted down, explained Barry Weber, the chief executive of Edith Weber & Associates in New York, a gallery specializing in rare, antique and estate jewelry, who often appears on "Antiques Roadshow." "They pick out anything that has greater than scrap value," and it ends up in retailers' showcases.

Janet Levy, a principal at J.& S.S. DeYoung, a 170-year-old wholesale firm in New York, advises consulting a specialist - saying the education received may pay off well. "If you go to a jeweler rather than a refiner," she said, "and he or she notices that you have a period piece rather than something that can be scrapped, you can get a huge added value."

Getting a professional appraisal is informative and reassuring; it also avoids mistakes. Ms. Levy suggests seeking out someone with credentials that are recognized in the jewelry trade. "Look for someone with jewelry trade affiliations, such as the American Gem Society," or someone who has training with the Gemological Institute of America, which requires rigorous educational standards to be met before a candidate is deemed an expert. Knowing that an affiliation with either group will increase consumer confidence, members often display their qualifications in shop windows or on business cards.

Generally speaking, jewelers with these credentials are expected to examine jewelry with greater skill. "We recently bought a piece with an alexandrite in it that was set in yellow gold" and was thus very valuable, said Alan Levy, Ms. Levy's husband and also a principal at DeYoung. "To the ordinary person, it would not have looked like very much. That's why it's good to go to someone who is knowledgeable."

Experts should also have the resources to investigate further if necessary. "We get calls from people every day asking for information on pieces a client has brought them for evaluation," Ms. Levy said. "What is wonderful today is that we have the Internet and digital photography so that we can give them a very good idea of what it is they are looking at."

Daphne Lingon, senior jewelry specialist at Christie's, suggests asking questions of anyone performing an evaluation:

• What is the metal, and should it be tested for gold content? After 1898, all jewelry made in the United States containing gold was required to be stamped with its number of karats; the most common mark is 14k. Unmarked jewelry should be tested.

• When was the item made, and has it been repaired? According to jewelry industry analysts, the age and condition are, in most cases, vital for assessing value.

If a piece is desirable on the secondhand market, it may be worth substantially more than the value of the metal and gemstones.