I share some tips on "how to buy gold" that i read on times of india news paper.
Did you know that indian households collectively have at least 40,000 tonnes of gold while Fort Knox in th US has ony 16,600 tonnes of gold, and the RBI about 600 tonnes of gold?
The Carob trees in Egypt throw millions of seeds into the desert before it rains. All the seeds have the same weight known as carat. Due to the undeveloped arithmetic, 24 was maximum in gold-rich Egypt at that time, compared to our 100. S0 22 of theirs means 91.6%, which is represented as 916/1000, the figure used to represent ornament gold of 22 carats. Pricing, billing, weight and quality are areas you must be alert while buying gold.
Wastage is inevitable in melting and designing and in adding two carats of copper. If a jeweller claims that he does not charge you for wastage and making charges, then it is unfair trade practice. A sinple calculation will reveal the truth. You divide the final payment made for the end product, say 16,580, by the gross weight of the jewel you bought, say 10 gram, and you get Rs 1658 per gram while the rate of gold is Rs 1382 per gram. The extra, roughly 20% or so depending on the design, is what you pay for wastage and labour. The price of gold is fixed by the jewellers of the town in relation to metro prices but making charges and labour are fixed by the jeweller.
If it is gold ornament studded with stones, you must insist that the jeweller mention in the bill seperately the weight and price of stones. If the gold weighs 10 gm and stone 1.5 gm, check if the bill is for 11.5 gm multiplied by the price of the gold per gram. If you do not do that, you will end up paying price of the gold for the weight of the stone.
Some jewellers would mislead you by telling that the billing would entail heavy tax and hence you have a hand written estimate passing off foe a bill. The tax for gold ornament is only 1%. For a jewell that costs Rs.14,300, that tax is only Rs 143. You can happily pay the tax for the protection the bill gives.
It would worthwhile to check the weight of any gold ornament in what is called the arbitrators' shop which functions soley to weigh the ornaments for a nominal sum. As this is run by jewellers' Association, its weighment is accepted by all jewellers in case of dispute.
Hall marking that vouches for quality has been introduced by Bureau of Indian Strandards(BIS). In major towns, there is/are hall marking centers(privately run) to which the jewellers send each ornament to get stamped. BIS at best may periodically check. Hall marking costs you Rs 100 more. For small purchases jewellers may reduce this. Jewellers are free to sell jewellery that does not have hall mark also. Please note that hall marking by itself does not mean that the gold is 22 carats. One can have a hall marking for 14, 18, 20 carats also.
So how are you to know what you buy is of 22 carats? You must learn to read the marks. The first is the BIS symbol. the number 916 stands for 22 carats. If it is 585, it is 14 carats, If it is 750, It is 18 carat and so on.
The next three letters indicate the name of the hall marking centre. BHC means Bharat Hall Marking centre. The next letter, "K" is the code for the year(2009) of the design and make. J stands for 2008 and L stands for 2010. The last emblem is is that of the jeweller's shop. For instance, Ng stands for N Golpaldass, Tiruchi. Where does one find all this? In the inner surface of the ornament. One requires a magnifying glass. As it will always be near by in a jeweller's shop you can ask for it and look. If the jeweller is not co-operative, just walk away.
Thanks and kind regards,
P.Jerald
