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Home Converting Metals to Cash

Converting Metal to Cash

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Once you have acquired gold or silver scrap or bullion - you need to be able to convert it back into cash. My assumption is that you are not a collector and not a hoarder. Meaning you want the money more than you want the metal. Of course - if you want the metal then you can skip this section!

There are several options for converting the precious metal to cash, some better than others. I'll start from most desireable (best payout) to least desireable, these include:

  1. Getting credit with your favorite jewelry store (120%+ payout as store credit)
  2. Selling directly to a refinery (95% payout for gold and 90%-93% for silver)
  3. Selling on eBay (between 70%-85% payout)
  4. Selling to a Pawn Shop (around 50% payout or less)
  5. Selling to an online or TV service that pays cash for precious metals (typically less than 50%, as low as 10%)

Generally speaking, getting cash less than 95% of spot price for gold or 90% of spot price for silver is a bad deal.

If you think that you can generate more than $10,000 of metal at any one time - then be aware of the USA Patriot Act that all businesses are required to comply with. Basically you will be reported to the government which may or may not result in anything. It's meant to let the government know that a person might be into either Money Laundering, Terrorist support, etc. Like it or not - you will have to comply with it and agree to the terms before anyone will refine for you. For a majority of us generating checks under $10,000 at a time is NOT a problem. Gold Hunters typically don't generate that much volume all at once...and I definately do NOT recommend keeping lots of gold/silver around the house or office waiting to hit some magic number before you turn it in. Remember, if you aren't converting the metal to cash - you are losing money. Say what? It's called Time Value of money. A dollar today isn't worth a dollar tomorrow...let alone a year from now or 2 years etc. Especially if you have credit card debt or home equity lines or similar interest bearing debt. Converting metal to cash and paying down debt is like getting an extra 5%, 10%, or even 30% return on your money! (Carrying debt isn't good and if you can pay it down - you are essentially investing in yourself with a high rate of return).

Last Updated on Thursday, 13 May 2010 18:29