Reasons Why You Should Not Send Your Gold Through Mail:
Cash 4 Gold Review –
Paid 18% of Gold Value
My wife and I recently sent some
items to Cash 4 Gold, a company that allows you to send
jewelry or other items with gold content in exchange for a prompt cash
payment. The company has become somewhat well known following some
mainstream media coverage, a Super Bowl ad, and extensive internet
First, some background about the items we sent. My wife had a number
of broken or unwanted gold jewelry items. This consisted of some broken
bracelets and a few single earrings. We brought the items to a number of
jewelers who provided similar offers for the larger items. There were
four single earrings that none of the jewelers wanted to purchase
because of the low gold content and small size. Some jewelers told us
that these items were basically worthless.
Because I had always been curious about Cash 4 Gold,
I decided that these items would be ideal for an experiment. The
process for sending our items to them was simple. We filled out a form
online and a few days later received a "Refiner's Return Pak." We put
our items in the pack and sent it back to Cash4Gold in the postage paid
mailing envelope. Our expectations were not very high, but we were
curious to see how much we would receive.
About a week later we received a check in the amount of $3.22.
The check also included a description of the items we sent and a
calculation of the price paid for each. A scan of the check and
descriptions appears below. Click for a larger image.
I have bought and sold gold coins
before and knew the price of gold, but I had to spend some time figuring
out their calculations. Whenever I have dealt in gold, it has always
been measured in ounces. They used a unit of weight referred to as DWT,
which I later found out represents a "pennyweight" or 1/20 of an ounce. I
was familiar with the karat grade, which refers to the purity of the
gold. A grade of 24 karat refers to the finest purity gold (99.9% or
finer). Each karat refers to 1/24 purity. For example, 18 karat gold is
18/24 pure, or 75% purity.
Based on their descriptions, I was able to determine the actual value
of the gold that we sent:
One earring had a weight of 0.07 DWT or 0.0035 ounces and a purity of
18 karat or 75%. Converting to ounces of pure gold 0.0035 X .75 =
0.002625 ounces. Using a gold price of $950 per ounce yields a value of $2.49375.
We were actually paid $0.45 for the item. This
represents 18.045% of the calculated value.
Two earrings had a weight of 0.56 DWT or 0.028 ounces and a purity of
14 karat or 58.33%. Converting to ounces of pure gold 0.028 X .5833 =
0.016333 ounces. Using a gold price of $950 per ounce yields a value of $15.51635.
We were actually paid $2.77, which represents 17.852%
of the calculated value.
The check indicated that our payment included their "20% Gold Rush
Bonus". It also stated that if we were not satisfied with out
settlement, we could call or email to have our items returned.
I suppose we will cash the check, but the payment of 18% of the value
of a liquid commodity is distressing. In our situation, we sent
unwanted items with a very low value, primarily as an experiment. Cash
4 Gold undoubtedly has some customers who are forced to sell
cherished items with higher gold content and values. Are these people
also receiving only 18% of the value?
August 14th, 2009