Anyone with a jewellery box urged to check it now | Personal Finance | Finance
Brits are being urged to rummage through drawers and jewellery boxes after gold and silver surged to new all-time highs.
Gold climbed to $4,603.87 while silver hit $84.69 today as investors piled into so-called safe-haven assets.
The rise came amid growing tensions in Iran, the prospect of US military action and news that the US Justice Department has launched a criminal probe into Federal Reserve chairman Jerome Powell.
The spike has sparked a rush of interest well beyond City traders, with experts saying ordinary households could be sitting on valuable items without realising it.
Jim Tannahill, Managing Director at London-based Suttons and Robertsons, said everyday people could benefit if they already own precious metals.
He said: “These all-time highs are creating real opportunities for everyday people. If you already own gold or silver, whether physical or digital, these levels give you options.
“You can sell and lock in a profit, or use what you own as security for a short-term loan without having to part with it permanently. It’s also well worth checking drawers and jewellery boxes.
“Old, broken or unwanted jewellery can be worth far more than people expect at today’s prices, and if you’re unsure whether something is real gold, it can be tested for free and valued by carat. Getting exposure to gold doesn’t have to mean stocks, funds or bullion.
“Well-bought second-hand gold or platinum jewellery is an often-overlooked option. It’s something you can wear and enjoy, with the added benefit of holding its value or rising over time. In the UK, there can also be tax advantages, as many jewellery items sold under £6,000 are CGT-free, and UK legal tender gold coins such as Sovereigns are exempt altogether.”
But others warned that record prices can tempt people into poor decisions. Samuel Mather-Holgate, Managing Director and IFA at Swindon-based Mather and Murray Financial, urged caution.
He told Newspage: “With precious metal prices at all time highs it’s tempting to jump in and buy the metals directly or through an Exchange-Traded Fund (ETF), an investment fund that holds a collection of assets. But unlike other traditional investments there’s no compounding of interest as these don’t generate any return other than capital growth.
“The best play here is to find a stock or a fund that broadly invests in companies that work in that sector; gold and silver miners are typical but it could be other areas too. “The world is getting more dangerous, and precious metals are always a good hedge.”
David Belle, Founder and Trader at Fink Money, also said investors should look beyond the raw metals.
He said: “Rather than outright buy the commodity, I much prefer to buy the miners. This way you have a much better understanding of margins and cash flow, rather than buying the original product.
“When you’re just buying a commodity, you’re more at the whims of macro, whereas when you’re buying a company that does things with said commodity, you’re sort of protected by a board and specialists who have a motivation to make money.”
For those tempted to cash in jewellery, Anita Wright, Chartered Financial Planner at Ribble Wealth Management, urged people to slow down.
She said: “Gold and silver making fresh all-time highs is exciting, but it is also the sort of price action where I would urge people to sit tight and keep their heads. Should people raid drawers and jewellery boxes? It can be worth checking, but do it methodically. Separate items by hallmark (if any), weigh them, and get more than one quote from reputable buyers.
“Be cautious of high-pressure ‘cash for gold’ style operations and be clear whether you are selling as scrap (melt value) or as a collectable/piece of jewellery (which can be worth more). Sentimental value is real too — once it is gone, it is gone.”
Rob Mansfield, Independent Financial Adviser at Tonbridge-based Rootes Wealth Management, delivered a final warning.
He said: “Before you dive into buying something that’s shot up significantly, think carefully about what your aims are and what you could afford to lose. There’s no guarantee that something that has risen will continue to do so. Chasing returns rarely ends well. If you do want to speculate then there are funds that invest in the mining companies or exchange traded funds (ETFs) that invest directly in the metal.”
