Gold Buyback and Trade-In Explained
The bag comes out of the drawer and you tip it onto the counter. A bangle nobody wears, a chain that snapped years ago, one earring whose partner vanished around 2011. You have a vague sense this is worth something and no idea whether the number you are about to be quoted is fair.
So what determines that number? Why is it always less than the price on the shop's own tags? And is selling actually the right move, or is there a better version of this transaction that nobody mentioned?
Here is how it works, including the part of it that is our margin.
The formula behind every offer you will get
Every legitimate gold buyer in Singapore calculates your payout the same way:
Payout = gram weight × purity × the day's gold rate − the buyer's spread
Four inputs, and you can verify three of them on the spot.
Gram weight should be measured on a scale in front of you. If a buyer weighs your gold out of sight, leave.
Purity is 916, 999, 750 or whatever the piece actually is, tested rather than assumed. A good buyer will XRF it while you watch.
The day's gold rate is public. It moves daily and nobody at the counter controls it.
The spread is the buyer's margin, and it is the only number you have to ask for.
The spread, which nobody explains
This is the part of the transaction that feels like a trick until someone tells you what it is.
No gold buyer pays you the full metal value, because then they would make nothing. The gap between what your gold is worth and what they hand you is the spread, and it covers testing, refining or reworking the metal, the cash sitting in their till, and the risk that gold falls before they can move it.
That is a real cost of doing business, and every buyer has one. The difference between a good deal and a bad one is not whether there is a spread. It is how wide it is and whether anyone tells you.
So ask for it as a number. "What is the rate you are paying per gram today, and what is the spot rate?" A buyer who answers both questions plainly is quoting you honestly. A buyer who gives you a single lump-sum figure and will not break it down is hoping you do not do the arithmetic.
Then do the arithmetic. If you know the grams, the purity and the day's rate, you can work out the metal value yourself in about twenty seconds, and the difference between that and the offer is the spread. Compare two buyers on that figure rather than on the headline number.
Four ways to turn gold into money
Most people think there is one option. There are four, and they have genuinely different economics.
| What it is | You keep the piece? | Best when | |
|---|---|---|---|
| Buyback | Selling back to the shop that sold it to you | No | You have the original receipt and the shop offers it |
| Trade-in | Old gold offset against a new piece | No, you get a different one | You want something else anyway |
| Outright sale | Selling to any registered gold buyer | No | You want cash and nothing else |
| Pawn | A loan secured against the piece | Yes, if you redeem it | You need money temporarily and want the piece back |
Pawning is worth understanding properly, because plenty of people dismiss it and it is the right answer more often than they think. Under Singapore's Pawnbrokers Act 2015, interest is capped at 1.5% per month and the standard redemption period is six months. You are borrowing against the gold, not selling it, so if you redeem within the period you keep the piece. For a short cash gap on something you actually want to keep, that is a very different proposition from selling.
The other three all end with the gold gone. Which brings us to the one that most people get wrong.
Why trading in usually beats selling
Here is the mechanism, and it is the most useful thing on this page.
When you sell gold outright, the buyer's entire profit on the transaction is the spread. That is all they get, so they have every reason to keep it wide.
When you trade in, the shop makes its margin on the new piece you are buying. The old gold is a deposit toward that sale. Suddenly the spread is not their only source of profit, which means they can afford to be more generous on your metal and still do well on the deal.
So if you were planning to buy another piece anyway, selling first and buying second is the expensive way round. You take the worst version of the spread on the way out, then pay full retail on the way in. Trading in collapses both sides of that into one transaction where the shop is motivated to give you a better number.
The test is simple. Are you going to buy gold again in the next year? If yes, trade in. If no, sell outright and shop the spread hard.
And if the new piece costs more than your old gold is worth, the difference can go on Shop Now, Pay Later with $0 down and up to 12-month instalments through Atome, PayLater by Grab, or SPayLater by Shopee. That combination — old gold as the deposit, instalments on the gap — is how most people upgrade without ever writing a large cheque.
What does not come back
Three things, and knowing them in advance saves a lot of disappointment at the counter.
Workmanship is gone. You are selling metal, not craft. A heavily worked bangle and a plain one of the same weight and purity are worth the same on buyback. If you paid a premium for an intricate design, you paid it to own the design, not to recover it.
GST is gone. The 9% you paid on the purchase is tax, and tax does not come back through a jeweller.
Visual size counts for nothing. A hollow chain that looks like a 30-gram piece and weighs 12 grams is valued as 12 grams. That is not a penalty on hollow construction; it is simply how weight works, and it applies to every piece of gold jewellery ever made. We explain the construction properly in Is hollow rope real gold?.
None of that is a reason to feel cheated. It is a reason to buy the piece you actually want to wear, since the wearing is the part you get to keep.
Check the buyer is legally allowed to buy it
This is the section nobody writes, and it is the single strongest protection you have.
Since 10 April 2019, under the Precious Stones and Precious Metals (Prevention of Money Laundering and Terrorism Financing) Act, anyone dealing in precious metals in Singapore has to be registered with the Registrar of Regulated Dealers at the Ministry of Law. Acting as a regulated dealer without registration is an offence carrying a fine of up to S$75,000, imprisonment of up to three years, or both.
The practical version: a legitimate gold buyer is a registered dealer, and the register is public. Anyone offering to buy your gold in a carpark, over a messaging app, or from a stall with no business name behind it is either registered and can prove it, or is committing an offence before you even discuss price.
Pawnbrokers are separately licensed under the Pawnbrokers Act and appear on the Registry of Pawnbrokers, also under the Ministry of Law.
Two registers, both public, both free to check. It takes a minute and it eliminates the entire category of risk that actually costs people money.
What to bring, and what to ask
Bring your NRIC or passport. Registered dealers are required to verify identity, so a buyer asking for ID is a good sign rather than a nuisance.
Bring receipts if you have them. They establish weight and purity and make the whole thing faster.
Do not clean the pieces aggressively. Polishing removes a small amount of metal and abrasives can damage a surface. Wipe them and leave it there.
Bring everything, including the broken things. A snapped chain, a single earring and a bent ring are all still gold and all still weigh something. Do not sort out the "ruined" pieces before you come; ruined is a wearing problem, not a metal problem.
Ask them to weigh it in front of you. Non-negotiable.
Ask for the quote in writing before you agree to anything.
The reframe: you are not selling jewellery, you are selling grams
Here is the shift that makes all of this easier.
The moment you decide to sell, the piece stops being jewellery and becomes a quantity of metal. That sounds cold, and it is also liberating, because metal is a commodity with a public price. You do not need to negotiate on taste or sentiment or how much you originally paid. There is a number, it is knowable, and you can check it on your phone.
Which means the whole transaction reduces to two questions. How many grams, at what purity? And how wide is the spread?
Everything else is noise. Get those two answers from two different registered buyers and you will know within minutes which offer is the real one.
At JJ Gold we weigh and test everything in front of you, quote against the day's rate, and put the numbers in writing. We buy back what we sold, we take trade-ins against anything in the shop, and we will tell you honestly when trading in beats selling for what you are trying to do. Everything we sell is real 916 or 999 gold, never plated, which is also why we are comfortable buying it back.
Bring the bag. Bring the broken chain and the single earring and the bangle nobody has worn since 2009. We will weigh it, test it, and give you a number you can check, whether you decide to sell it, trade it, or put it straight back in the drawer.
City Plaza #01-47 (810 Geylang Road, Singapore 409286) or Lucky Plaza #02-47 (304 Orchard Road, Singapore 238863). Call 8950 4377 for the day's rate before you make the trip, or browse what you might trade up to at jjgoldjewellery.com.
Know the grams. Ask for the spread. Trade in if you are buying again anyway.