Since the dawn of history, gold has been a token of royalty across the globe! Whether you talk about the ancient kingdoms or recent trends, everything royal has a touch of gold!
The inherent beauty and scarcity of the metal have made it valued highly in phrases to represent importance and comparison.
Gold is a dearly preserved metal, as it is present on the planet only in finite abundance and cannot be expanded artificially. The scarcity and attractiveness of gold have made it an alluring asset for those looking forward to an investment.
Gold can be bought in various ways, such as gold coins, gold bars, ornaments, and showpieces. However, the most common question at the time of buying and selling gold is, why is buying gold bars cheaper than buying gold jewelry?
Well, buckle up! We are here to state a few facts that help you understand why gold bars are cheaper than gold jewelry.
What is the Difference between Gold Bars and Gold Jewelry?
Gold bars are pieces of gold made up of the finest gold components, i.e. 22-24 carats of gold. One can buy gold bars if their sole purpose to buy gold is an investment.
Gold Jewelry is wearable ornaments made up of gold. One can buy gold jewelry if one wants to adorn their investments on occasion.
Is Gold Bar Cheaper than Gold Jewelry?
Suppose you buy gold jewelry worth $100.00 and your friend buys a gold bar worth the same amount. Within 3 months, the price of gold increases, and you both visit a gold buyer to sell the gold investment. The gold bar will bring a better return.
Several factors validate this difference between the cost of gold bars and gold jewelry.
Factors Affecting the Cost of Gold Bar and Gold Jewelry.
a. Making Charges
One of the biggest reasons behind the difference between the costs of Gold bars and Gold jewelry is the making charges. Gold bars are usually made in bulk and thus have near to negligible making charges. On the other hand, a jeweler can charge from 5% to 20% of the actual price of gold, as the making charges based on the design of the jewelry.
Gold bars or gold biscuits are pure and can be made from 22-carat or 24-carat gold. However, jewelry made up of gold requires the mixing of other metals, such as silver, iron, nickel, cadmium, etc. Gold bars being pure do not charge too much, but the addition of alloy in the jewelry may add up to the charges of your gold jewelry.
c. Maintenance Charges
The cost of maintenance of gold bars is comparatively less, as you can store gold bars without any worry of breakage. In jewelry, the chances of wear and tear increase if the gold jewelry is diligently made and stored carefully. Thus increasing the charges of the ornament.
Another reason that may affect the charges of a gold bar is its usability. One may prefer to invest in gold jewelry over gold bars, as gold jewelry can be adorned, but gold bars can only be stored as an investment.
The multiple levels of tax payment upon jewelry also increase its actual price. However, gold bars are sold as raw metal across the world, so there is very little to no goods and services tax.
What to Buy Gold Bar or Gold Jewelry?
The decision of whether to buy gold bars or gold jewelry depends on your aim of making the purchase. If your sole aim is to buy gold, I need to make an investment and earn a profit, then you should buy gold bars. However, if you are someone who wishes to wear gold as an ornament, then you should buy gold jewelry as an investment.
Gold is a stable source of investment with a global benchmark. The price of the metal rises as the stock market falls, and thus, by investing in gold, you can ensure stability in your wealth. The demand for gold in the Indian and Chinese governments has maintained the high stakes of gold across the globe. Due to the increased stakes of gold and the stability of the metal, experts usually recommend investing in gold by buying gold from reliable gold shops. If you are yet to invest in gold bars and gold jewelry then doesn’t forget to visit the R & J Jewelry and Loan shop for your gold-buying needs.