Does jewelry depreciate?
As you’ve probably heard, the moment you buy an automobile, a phone, or a laptop, it begins to depreciate. This is true of a lot of things, but does it apply to jewelry? Does jewelry depreciate or does it grow in value over time? The short answer is yes, most of the time. The long answer is more complicated, and relies on a few factors.
You see, while most jewelry does depreciate over time, it depreciates at different rates. Jewelry is, of course, a valuable commodity, sometimes used as currency and often passed down as an heirloom. This only applies to high quality jewelry, though. Low-quality costume jewelry isn’t worth very much, even when it’s new, and as time goes by, its value drops dramatically.
Fine jewelry is a different matter. While costume jewelry, also known as fashion jewelry, is made of materials like brass, copper, and bronze, or even plastic or wood, and sometimes fake gemstones. Costume jewelry can sometimes look more expensive than fine jewelry, but in reality, it’s not high quality. By contrast, fine jewelry is made of materials like platinum and gold, with precious gemstones like diamonds, sapphires, emeralds, and rubies. Fine jewelry can be ornate or minimalist, and this has no bearing on its value. Because it’s made of high-quality materials, it’s valuable, no matter how old it is.
In fact, antique and historic jewelry, along with rare and unique jewelry, doesn’t just hold its value, it appreciates rapidly as time passes. Buying jewelry from the Victorian, Edwardian, or Art Deco era is a smart investment, because it’s worth more than modern jewelry and will only grow in value. This is especially true of jewelry that contains a gem-quality stone.
Of all the gemstones, diamonds are the most expensive. It’s important to note, though that only the most high-quality diamonds appreciate as they age. What about lower-quality diamonds? Do diamonds depreciate? In fact, low-grade diamonds lose between 20 and 30 percent of their value as soon as they’re purchased. Lab-grown diamonds lose their value even more dramatically, depreciating 80 percent upon purchase.
How can you make sure the jewelry you buy won’t lose its value? And would you know if the jewelry you already have is valuable? If you’ve been wearing it for many years and it’s never sustained a scratch or chip, and it’s not tarnished, it’s probably good quality. The best way to tell if jewelry is valuable is to have it professionally appraised, but if that’s not possible, there are signs you can look for on your own. Fine jewelry has a hallmark to certify the purity of precious metals, and high-quality metals like gold, silver, and platinum weigh more than materials like pewter or brass. With diamonds, if you know the “four Cs” (cut, clarity, carat, and color) you’ll be able to identify the quality of a diamond you’re examining. If you’re considering purchasing a piece of jewelry, an appraisal is recommended, but at the very least you should give it a good once-over. Then, too, you should only buy from a trusted source, preferably from a known brand.
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