Many turn to selling jewelry to get cash

CLEVELAND (AP) — With the price of gold over $900 an ounce, people struggling to make ends meet amid the U.S. recession are more willing to sell jewelry to bring in extra money.

And there’s no shortage of entrepreneurs willing to buy up those gold bracelets, rings and coins.

David Hicks of Akron started Gold Guys Inc. last summer when the price of gold started to spike. The company, billed as a one-stop for a cash exchange of unwanted gold, sets up shop at five hotels in Northeast Ohio on the weekends and holds private jewelry parties at customers’ homes during the week.

“It’s like an antique road show in your house, and you get to see what crazy jewelry people had from the ’80s,” Hicks said.

The hard-luck stories of people seeking to sell their valuables are often sad — from a divorced woman who hesitated to part with a wedding ring to a laid-off teacher who cleared out her jewelry box to pay bills.

“I’m amazed at how much people want to talk,” said Meagan Soltis, a gold-tester for Gold Guys.

Jewelry bought by the company is sent to a refinery to be melted down and often turned into gold bullion or coins to be bought by investors, she said.

Melinda Sherman of Strongsville sold 19 pieces of jewelry to Gold Guys for about $400. She lost her teaching job last year and her husband, a mechanic, has seen his business slow down.

“I’d rather sell it than have it sitting in a drawer,” Sherman said of her jewelry.

People shouldn’t be so quick to part with their items, said Jeff Broestl, who owns a jewelry store in Lakewood. He urges people not to sell items for scrap unless they are broken or are something they will never wear again.

Even with high gold prices, Broestl said people can expect to get back only 20 percent of what they paid for an item because of the cost of crafting a ring or necklace.

The last time there was such a rush to invest in gold was during the 1979 energy crisis, said Margaret Olsen, an accredited metals appraiser who has been in the gold business for more than 35 years. Back then, like today, people are looking to take advantage of gold prices that are inflated by investors, she said.

“I used to really worry when I saw people selling jewelry to pay the electric bill,” Olsen said. “I thought, ‘What are they going to do next month?’”

Lou Tansky, owner of Uncle Ben’s Pawn Shop in Cleveland and president of the Ohio Pawn Brokers Association, said most people he talks to view selling valuables as a temporary fix, until they can figure out another way to meet their expenses.

A lot of people don’t have a choice, he said.