Common Misconceptions about Diamond-Buying
|Misconception #1: "The
bigger the markdown or discount, the better the deal."
We alluded to this in our introductory letter, but it's so important we've
repeated it here, just in case you missed it! A good deal isn't a function
of how much it's marked down, but how little it was marked up in the first
place. A good deal is when you compare prices on the same quality diamonds
from more than one source, then choose for yourself the best quality for
the least money, to suit your personality and lifestyle.
|TIP: If a deal
is too good to be true, it probably is.
|Misconception #2: "It
doesn't matter what I pay, as long as I get good quality, because
diamonds are a good investment."
There are too many factors affecting cost, such as markup, overhead, etc.,
for most diamonds to be considered a good invesment in a non-inflationary
economy. If you purchase a diamond ring for $1,000 on the new market and
need to sell it for cash the next day, the maximum percent received, on
a national average, is 25%, or $250.
|TIP: When "investing"
in diamonds, the less you pay for it, the less you will lose should
you ever want to trade or sell it.
|Misconception #3: "Highest
quality is always the best buy."
Actually, in America, the middle grades are the best sellers
and most in demand. Remember, if every size, color and clarity has a
different value that is controlled by DeBeers, as long as you pay the
proper price for that size and quality, one diamond isn't better than
the other - just different.
|Misconception #4: "Regular
jewelry stores sell new diamonds; estate jewelers and pawn shops
sell used diamonds."
Most jewelry stores take back the diamonds they sell,
as trade-ins, as long as the customer purchases a more expensive one
(usually double the cost of the returned item). They then remount those
stones in new mountings and put them back in the store for resale. Not
that we're suggesting there is anything wrong with a pre-owned diamond.
In fact, it's hard to tell a round brilliant diamond cut in 1930 from
one cut today. Just don't assume that every new mounting holds a brand
new diamond. And if you're going to buy a pre-owned diamond, you'll
save money by buying it from an estate jeweler.