If you are planning to sell jewellery and want to understand how gold value is calculated when selling old gold, knowing the exact process helps you avoid underpricing and hidden deductions. Many sellers lose money simply because they are unaware of how buyers calculate the final amount.
Gold valuation follows a clear, standard method based on purity, weight, and the current gold rate. This guide explains the entire process step by step, so you can confidently sell your old gold and get the right value.
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How is gold value calculated when selling old gold?
When selling old gold, buyers do not pay based on:
Jewellery design
Brand or making charges
Age or appearance
Instead, the value depends only on gold content. Understanding this prevents confusion and helps you choose a transparent gold buyer.
The 3 Main Factors Used to Calculate Gold Value
Gold buyers calculate value using three key elements:
Gold purity
Net gold weight
Today’s gold rate
Let’s look at each in detail.
1. Gold Purity (Karat Value)
Gold purity refers to how much pure gold is present in your jewellery. It is measured in karats (K).
Common Purity Levels
24K – 99.9% pure gold
22K – 91.6% pure gold
18K – 75% pure gold
14K / 12K – Lower purity gold
Even non-hallmarked gold can be sold after purity testing.
How Purity Is Tested
Gold buyers use modern, non-destructive methods such as:
XRF machines
Karat testing devices
These methods give accurate results without damaging the jewellery.
2. Net Gold Weight
Once purity is identified, buyers measure the net gold weight.
What Is Included?
Only the actual gold content
What Is Excluded?
Stones, beads, pearls
Non-gold materials
Thread or alloy parts
For broken jewellery, all pieces are combined and weighed together after removing non-gold parts.
3. Today’s Gold Rate
The final and most important factor is the current gold rate.
Important Points:
Gold rates change daily
Buyers should use the same-day market rate
Rate applied depends on purity (22K or 24K equivalent)
Always check the gold rate on the same day you plan to sell.
The Gold Value Calculation Formula
Most trusted gold buyers use this formula:
Gold Value = (Purity % × Net Weight × Today’s Gold Rate)
Example Calculation:
Gold purity: 22K (91.6%)
Net weight: 10 grams
Gold rate: ₹6,000 per gram
Calculation:
0.916 × 10 × 6,000 = ₹54,960
This is the fair value of the gold.
Are Melting or Wastage Charges Applied?
Reputed gold buyers usually do not charge:
Melting fees
Wastage charges
However, deductions may occur if:
Purity is lower than expected
Impurities are present
Always ask for a clear breakdown before finalizing the sale.
Does Jewellery Design Affect Gold Value?
No. Jewellery design, brand, or craftsmanship do not affect old gold value.
Making charges are ignored
Brand names don’t add value
Broken or damaged gold is valued the same
Only purity and weight matter.
How Broken or Damaged Gold Is Valued
Broken gold follows the same valuation process as intact jewellery:
Purity testing
Net weight calculation
Current gold rate application
Condition does not reduce value.
Can Gold Be Sold Without a Bill?
Yes. Gold value calculation does not depend on bills.
What is required:
Valid ID proof
Purity verification
This is common for inherited or old jewellery.
How to Verify If the Valuation Is Fair
To ensure fair valuation:
Watch the purity testing
Confirm net weight after stone removal
Ask which gold rate is used
Compare 2–3 buyers
Transparent buyers explain everything clearly.
Common Mistakes Sellers Make During Valuation
Avoid these errors:
Selling without checking gold rate
Not asking purity percentage
Accepting unclear deductions
Trusting verbal estimates
Awareness protects your money.
How Gold Value Calculation Differs for Various Purities
Not all gold jewellery has the same purity, and this directly impacts valuation. When selling old gold, buyers calculate value separately for each purity level if needed.
24K gold gets the highest value due to near-pure content
22K gold is most common for jewellery and is valued slightly lower
18K gold contains more alloy, so its value is lower
If you have mixed-purity jewellery, trusted buyers test and calculate each piece individually to ensure accuracy.
What Happens If Gold Purity Is Lower Than Expected?
Sometimes jewellery may test lower than what you believed. In such cases:
Buyers explain the exact purity percentage
Valuation is recalculated transparently
No arbitrary deductions are applied
A genuine buyer will always show test results before proceeding.
How Alloy and Impurities Affect Gold Value
Gold jewellery often contains alloy metals like copper or silver. These:
Increase durability
Reduce overall gold percentage
During valuation:
Alloy weight is excluded
Only pure gold content is paid for
This is why purity testing is essential for correct valuation.
How long does gold valuation take?
Usually 10–15 minutes with modern testing methods.
Understanding how gold value is calculated when selling old gold gives you confidence and control. Gold buyers calculate value purely based on purity, net weight, and today’s gold rate, without considering design or condition.
By choosing transparent buyers and knowing the process, you can sell your old gold safely and receive the best possible value without hidden deductions.
Does Market Timing Affect Gold Value?
Yes, market timing plays a major role in gold value.
Gold prices fluctuate daily
Selling on a high-rate day increases payout
Some sellers track weekly trends
Checking the gold rate before selling helps you choose the right day.
How Professional Buyers Prevent Under-Valuation
Trusted buyers follow strict procedures:
Calibrated weighing machines
Certified purity testing tools
On-screen calculation visibility
These steps prevent under-valuation and build trust.
Difference Between Estimated Value and Final Payout
Some buyers give an estimated value before testing. The final payout may differ due to:
Exact purity results
Stone removal
Accurate net weight
Always rely on final tested valuation, not estimates.
How Gold Value Is Calculated for Coins and Biscuits
Gold coins and biscuits usually:
Have higher purity (often 24K)
Fetch better value per gram
Since they lack stones or alloy, valuation is straightforward and transparent.
FAQs
How is gold value calculated when selling old gold?
Gold value is calculated using purity, net gold weight, and the current gold rate.
Does broken gold get less value?
No, broken gold gets the same value as intact gold of the same purity.
Are stones included in gold value?
No, stones are excluded and only net gold weight is considered.
Is hallmark mandatory for valuation?
No, even non-hallmarked gold is tested and valued.