Do You Really Know How Much Your Diamond Is Worth?

Posted on: 14 April 2016

When it comes to your diamonds, you can be on one side of the spectrum: either you are under-valuing your diamond jewelry or you are over-valuing it. A number of jewelry owners don't really have any clue what the true value of their diamond jewelry really is. In many instances, this lack of information can be traced back to a number of different misconceptions.

It's Not About What You Pay

One of the most common misconceptions people have is the assumption that their diamond jewelry is worth what they paid for it. Take an engagement diamond ring, for example. Many people recommend that you spend the equivalent of at least three months of your salary on a ring.

For someone who earns $5,000 a month, that's a ring that costs around $15,000. The problem with this is that it doesn't account for jewelry markups, which is how jewelers earn a profit. You may have paid $15,000 for the ring, but it might have only been worth $8,000. Since markups rates vary widely amongst industry retailers, how much you paid for the ring means little in terms of value.  

Carats Aren't All That Matters

When it comes to diamonds, bigger doesn't always mean better. If you have a 5-carat ring, and someone else has a 2-carat diamond ring, don't assume your ring is more valuable. Don't overlook the importance of clarity.

Given this scenario, the 2-carat diamond ring with an FL, or flawless, clarity rating could be more valuable than the 5-carat diamond that has an included level 1, 2, or 3 rating (included levels 1, 2, and 3 are all sub-grades of the lowest clarities). A large diamond alone isn't what makes it valuable, but instead the quality of the diamond is what matters.

Consider An Appraisal

Knowing exactly what your jewelry is worth is as simple as having your piece appraised. To make the process even easier, you can have the appraisal performed in the convenience of your home. You can talk with a professional, like Fortuna Auction, for more information. With an appraisal, a skilled jewelry expert can closely examine the condition of the piece as well as its other identifying details, such as clarity, to help you get a more accurate analysis of its worth.

Even if you aren't looking to sell your jewelry, knowing what you have is still important should you decide to sell in the future or pass down as an heirloom.