Guide
How old gold is valued: the formula explained
Learn how old gold is priced in India: net weight, purity and the day's rate, with a worked example you can check yourself.
- Value = net weight x purity x the day's 24K rate per gram.
- Net weight is what remains after stones, lac and dirt are removed.
- Making charges you paid when buying jewellery are generally not paid back when you sell.
- Ask which rate is used, when it was fixed, and for every deduction by name.
The basic formula
Almost every fair gold price comes from one line of arithmetic:
Value = net weight × purity × the day's 24K gold rate per gram
Purity is the karat divided by 24. So 22K gold is 22/24, or about 91.6%. 18K is 75%. 24K is about 99.9%.
A worked example
| Step | Example |
|---|---|
| Gross weight on the scale | 12.40 g |
| Less: stones, lac, dirt | 0.40 g |
| Net weight | 12.00 g |
| Purity | 22K = 22/24 = 0.9167 |
| Fine gold | 12.00 × 0.9167 = 11.00 g |
| 24K rate per gram (illustrative) | ₹ 10,000 |
| Value | 11.00 × 10,000 = ₹ 1,10,000 |
The rate in this example is a round number for illustration. It is not today's rate. Enter today's rate in our gold value calculator to try your own numbers.
Why net weight, not gross weight
Stones, lac, enamel, thread and dirt weigh something but are not gold. A fair buyer removes that weight first and shows it to you as its own line. If a buyer weighs everything together and never mentions stones, ask for the deduction in writing.
Why you do not get making charges back
When you bought the jewellery, the price included making charges and taxes. When you sell, buyers generally pay for the gold content. This is why old jewellery sells for less than you paid even when the gold rate has risen.
Which rate is used
Gold rates move through the day. Ask which rate is being used, where it comes from and when it was fixed. The rate on your written slip should be the one used when your gold was weighed, not a rate quoted days ago.
Check before you agree
- See the weight on a display that faces you.
- See the purity test and ask what it showed.
- Ask for every deduction, by name, on paper.
- Redo the arithmetic with the calculator.
- Say no if any line does not make sense.
Keep reading
Related guides and services
How to release pledged gold from a bank or gold loan lender
A plain guide to releasing pledged gold from a bank or gold loan lender in India: the steps, documents, costs and pitfalls to avoid.
Read more22K, 24K and 18K gold: purity and hallmark explained
What 24K, 22K, 18K and 14K mean, how to read a BIS hallmark and HUID, and why purity changes what your gold is worth.
Read moreRelease pledged gold
See how ClearKarat does it in plain sight.
Read moreStart with one message
See the weight. See the test. See the price. Then decide.
Send us a line on WhatsApp. We will tell you what we need, and you will not be asked to commit to anything.