How to tell if the Gold You Buy in India is Real or Fake?

Investing a huge amount of money only to discover that the gold you just bought is fake is the biggest investment disaster to happen. All that glitters isn’t gold, and all that isn’t gold can be a real piece of worthless metal. Before buying gold, a few simple tests and tricks can save you from buying fake gold jewellery or coins. So here are some nice and easy ways to tell if the gold is real or fake before you buy it.

Stamp test:

Whether you buy 22K gold jewellery or 18K jewellery studded with gold, which are the two primary karat weights available in India, always look for stamp with a hallmark note that denominates the purity of the gold. For 22K gold, the hallmark stamp is 917, while on 18k gold jewellery, you will find a figure 750.

How to know the gold 1

Acid Test:

If you have a slightest chemistry background, you would know Nitric acid is a highly corrosive mineral acid and is easy to get. Although this test is not suitable for ornamental jewellery as the acid might disrupt the aesthetic beauty of the gold item but for scrappy, old gold, which you plan to buy from a reseller or a pawn shop, nitric acid test works best. Using a nail filer or anything sharp to scratch a small patch in gold item and then use a drop of nitric acid on the scratched patch where there is no gold polish. If the patch turns green, it’s a gold plated piece or a non precious metal and not pure gold for sure. If it is gold plated silver, then the patch will turn milky.

Make-up Test

Apply liquid foundation on your skin and then rub the piece of gold on that area. If you find a black streak, you are most likely dealing with gold. This is a quick and easy test that can be performed anytime, anywhere, although its accuracy is often questioned.

Iron test

No, you wouldn’t need iron bars to perform this test. Anybody with mild anaemia or deficiency of iron in the body can help you with this test. Simply rub a piece of gold on the forehead of an anaemic person. If the gold leaves behind a black mark or streak, it for surely gold you’ve been rubbing on that forehead. This happens as the haemoglobin in the blood of an anaemic person rises suddenly on coming in contact with gold.

Density test

Can simply be called heaviness test too- this can be performed by dropping a piece of jewellery in a glass full of water. If it floats, it might be fake; if it sinks, it’s almost certainly gold! Try it at home before you are confident about it.

Magnet test

Magnet will not attract gold, we all know that. If your jewellery gets attracted to gold, it is either completely fake, or a considerable part of it is adulterated.

Things to Be Kept In Mind While Buying Gold Jewellery

Whether you are purchasing gold for a wedding or generally, there are some important points to ponder before swiping the card (in this new, cash-less India). Let’s take a quick look at these points without much adieu.

Ample research:

The first shop you come across might not be the best shop. It’s true that gold prices are globally regulated, but when it comes to jewelry, there are several aspects to consider. So carry out ample research before and for hitting the right store.

Hallmark stamp:

Did you know there are 5 stamps to look out for and not just the random number you just heard about of late? Apart from the 917 (22k) or 750(18k), also look for BIS logo, maker’s stamp, year of making and stamp of the hallmarking center. These stamps however are too tiny sometimes to observe with naked eye, but especially while buying jewellery weighing more than 40-50 gms, it’s really essential to spot the 5 hallmark signs.

How to know the gold 2

Making charges:

Although base gold price might be same, but the making charges differ from jeweler to jeweler and design to design. Sometimes you can also get an option to pay a flat making charge and you can benefit from this offer if you are buying gold in bulk. Did you know you can also bargain on making charges with a local jeweler?

Expensive doesn’t mean better

If one of the jewellers is charging more for the jewellery than others, it doesn’t mean that their jewellery or gold in particular is better. Selling impure gold is a crime, so gold quality cannot be better or worse, unless it’s a fraud. Expensive jewellery generally means hiked up making charges, and also has a lot to do with the brand also. If your jewellery is handmade and not machine made, you might end up paying as much as 40% making charges. So know the price breakdown is essential before simply assuming that expensive means better, which does not.

Gold exchange:

If you want to give away your old gold jewellery and either get it melted to prepare the new jewellery items on order or simply exchange the old gold items and buy new ones in return, there is a but for you to ponder. You end up paying making charges twice for the same amount of jewellery and if in case your old jewellery isn’t hallmarked, you will end up paying for waste polish, and your selling price will be 4 to 6% lower than the buy price. Are you forgetting the taxes you paid while buying that gold? Think again if you really want to exchange.

Buyback policy:

Before buying any piece of jewellery, ask your jeweller about their buyback policy. If your jeweller doesn’t buy back at 100% price, is that piece of jewellery even worth buying?

Get the bill:

Keeping gold without bill can end you up in trouble in more than many ways. You need a certificate for your gold and diamonds, a proof of purchase price (for exchange), and the recent demonetization act has given us ample hints why it is important to keep the bill.

Ultimate Reasons To Buy Gold Coins In India

Indians have been buying and accumulating gold for centuries now. Be it some special occasions like weddings, Diwali, Dhanteras, birth or birthday or a child in family, or investing a part of disposable income; buying gold, especially gold coins and bullions is an unending trend. And why wouldn’t it be? Here we have some ultimate reasons to buy gold coins in India as its still not too late.

Great Investment:

Gold is a great investment with a high potential reward ratio and low risk. For people and households with long holding capacity and low risk appetite, gold is an ultimate investment tool. Gold coins are the safest investment tool, contrary to gold jewelry as coins are made with 24K gold and making charges are not applicable on gold.

Transparency Advantage:

With gold coins, what you see is what you get. Firstly, you are putting your money in a 24K gold where there is no mixing or impurity, secondly, gold coin rates are nationalized on the basis of its weight and you will pay the same price irrespective of the state in India or buying from bank, jewellery store or online.

gold-coins-in-india

Quality Assurance:

All gold coins come with a BIS Hallmark from Bureau of Indian Standards. All certified gold coins pan India are minted by the Government of India and are guaranteed for purity, to ensure you always get the right price when you plan to sell or melt the coin for casting jewellery out of it. BIS Hallmark certified gold coins are guaranteed to be 99.9% pure and are made of 24 Karat gold only.

Easy Monetization:

Selling off your gold coins is rightly considered to be the easiest investment monetization process. Think about how long it takes to find a customer for real estate, the tantrums a jeweller throws when you try to sell off your gold jewellery and charges you end up paying if you liquidate your financial investment plan midterm. But with gold coins, monetization is easy as pie. You can sell your coins at a genuine price just when you want to.

Investment in Instalment:

Just like an SIP plan, you can buy gold coins in small amounts as and when convenient and build a great investment in gold over a period of time. Gold coins are easy to store, and come with a constant quality irrespective of time or term. So for a safer future, gold coins can be purchased regularly in small amounts for easy speculation.

How To Clean And Maintain Silver Coins

If you take out silver coins from your locker at the time of Diwali for Laxmi Pujan, only to find them tarnished and discolored, here’s an ultimate guide on how to clean your silver coins, unless you are a coin collector and like to keep them aged.

silver-coins

#1 Wash Them Off:

If you don’t think there is a lot of dirt build up in crevices or an environmental reaction that turns the coins greenish grey, simply wash the coins with warm water under a running tap. Ensure you plug the drain so the silver coins do not slip into the drain. The pressure from the tap will help clean the coins easier and better. If washing the coins with warm water alone doesn’t help, try the net tip.

#2 Coin Bath:

Prepare a bath for your precious coins using a dishwashing soap and lukewarm water in a bowl. Soak the coins in this bath for about half an hour and rinse with clean water. It is advisable not to use an abrasive dish scrubber unless truly required. A mild soap or dishwashing liquid should be able to bring your silver coins back to shiny state once again.

#3 Brush up the Coins:

Using an old tooth brush and toothpaste; brush up the coins to remove the green coloured coating from your coins. This green coating is called patina and is visibly seen in silver, brass and copper. Patina is an oxidation build up and is pretty normal to be found on pure silver coins. Cleaning the coins with a toothbrush and the paste will help you get rid of this thin build up that makes the coins look dirty, old and ugly.

#4 Acetone Bath:

For stubborn, weary coins, use acetone bath for bringing back the silvery shine. Be it silver coins or jewellery, soaking them in acetone (nail paint remover). But utterly important is the point that acetone bath should not last more than 5 seconds. That means you merely need to rinse the coins with acetone and then immediately rinse them off with distilled water. Pat them dry and store in an air-tight jewellery box.

#5 Chemical Dip:

Dip your super stubborn silver coins in a bath made with isopropyl alcohol and salt. Prepare a solution with one cup of isopropyl alcohol and 2 tablespoons of salt. Dip your silver coins in this solution and take them out clean, shiny and anew.

How to Tell if the Gold You Buy in India is Real or Fake?

Investing a huge amount of money only to discover that the gold you just bought is fake is the biggest investment disaster to happen. All that glitters isn’t gold, and all that isn’t gold can be a real piece of worthless metal. Before buying gold, a few simple tests and tricks can save you from buying fake gold jewellery or coins. So here are some nice and easy ways to tell if the gold is real or fake before you buy it.

Stamp test

Whether you buy 22K gold jewellery or 18K jewellery studded with gold, which are the two primary karat weights available in India, always look for stamp with a hallmark note that denominates the purity of the gold. For 22K gold, the hallmark stamp is 917, while on 18k gold jewellery, you will find a figure 750.

Acid Test

If you have a slightest chemistry background, you would know Nitric acid is a highly corrosive mineral acid and is easy to get. Although this test is not suitable for ornamental jewellery as the acid might disrupt the aesthetic beauty of the gold item but for scrappy, old gold, which you plan to buy from a reseller or a pawn shop, nitric acid test works best. Using a nail filer or anything sharp to scratch a small patch in gold item and then use a drop of nitric acid on the scratched patch where there is no gold polish. If the patch turns green, it’s a gold plated piece or a non precious metal and not pure gold for sure. If it is gold plated silver, then the patch will turn milky.

Make-up Test

Apply liquid foundation on your skin and then rub the piece of gold on that area. If you find a black streak, you are most likely dealing with gold. This is a quick and easy test that can be performed anytime, anywhere, although its accuracy is often questioned.

Iron test

No, you wouldn’t need iron bars to perform this test. Anybody with mild anaemia or deficiency of iron in the body can help you with this test. Simply rub a piece of gold on the forehead of an anaemic person. If the gold leaves behind a black mark or streak, it for surely gold you’ve been rubbing on that forehead. This happens as the haemoglobin in the blood of an anaemic person rises suddenly on coming in contact with gold.

Density test

Can simply be called heaviness test too- this can be performed by dropping a piece of jewellery in a glass full of water. If it floats, it might be fake; if it sinks, it’s almost certainly gold! Try it at home before you are confident about it.

Magnet test

Magnet will not attract gold, we all know that. If your jewellery gets attracted to gold, it is either completely fake, or a considerable part of it is adulterated.

How Indian Wedding Tradition Drives Global Gold Demand

Weddings In India; Fireworks In Global Gold Prices!

Before the wedding season in India begins, all eyes roll to global gold prices index in anticipation of price fall for better gold shopping opportunities but how often we do look at the wedding season as an opportunity for global gold price chart to surge high? India’s annual gold imports are hefty enough to affect the global index and hence more than the gold prices affecting the Indian wedding season, it’s the season itself that affects the gold prices worldwide. Sounds bizarre? There still are some crazy, mysterious facts in the global finance out there!

Why is gold the major expense at an Indian wedding?

How Indian Wedding Tradition 1

It’s in our genes, in our culture and traditions to mount up as much gold as one can afford as a daughter’s wedding and many mothers actually start collecting gold for the daughter when she’s still at a very tender age. The custom of giving away gold to the daughter at her wedding and welcoming the daughter in law with gold jewellery is time honoured and traditional in all regions, cultures and economic sections. Typically, it was the parents’ way of securing the daughter’s future and ensuring a backup plan at the time of crisis, a way to make the daughter feel financially safe in the new family and make the in laws realise her importance based on the amount of gold she’s wearing. For in-laws, it’s the way of telling the daughter-in-law, her parents and the world how affluent they are and how capable of taking good care of the new bride.

Why is gold imported to India?

How Indian Wedding Tradition 2

No matter how much gold has been hoarded in temples and religious establishments, bank lockers of affluent and influential, big shots in the country, the domestic demand is ever increasing with the increasing per capita income in India. People from all economic backgrounds simply want to accumulate as much gold as possible from their savings as gold is considered to be safest long-term investment in India. India’s domestic gold production hasn’t been able to meet the domestic demand for past many decades and hence gold is imported from various countries although 80% of the imported gold is consumed domestically while 20% is bejewelled and resold in the global marketplace.

What affects gold prices?

Apart from the technical indicators, fluctuation in dollar and oil prices, gold price is also majorly affected by the demand of gold in India. India is the world’s largest consumer of gold. As India imports more and more gold, the global gold price gets affects directly. As the wedding seasons approach, the surge in gold price is natural and universally accepted. The question is- will Indians ever stop buying gold? The answer most likely is- NO.

Comprehensive Yet Crisp Guide to New Gold Schemes by the Indian Government

Indian Government launched three new gold schemes to help the resident Indians monetize on their biggest investment in life. The Prime Minister wants people to earn interest on their hard earned gold which is uselessly kept in the bank lockers, earning no interest whatever, just in the anticipation of price rise. With these schemes, the resident Indians will be able to grow their money even if they have invested in gold, and not in funds, bonds or stocks. This will not only reduce the amount of gold imports that reduces the value of rupee against dollar but also makes India incur many import duties and taxes.

All About New Gold 1

So here’s a comprehensive, yet crisp guide about new gold scheme in India.

Gold Monetization Scheme

We have already heard and read about gold loans, but gold monetization is the government’s scheme that asks the gold holders to deposit the jewellery or gold in any form to the registered banks or post offices for a minimum fixed tenure of one year and earn an interest rate of 2.25 to 2.5%, depending on the tenure. You will not get back the same gold that you deposited but you can choose to get your returns in either cash or gold bullions/coins form.

All About New Gold 2

This will help the country meet the domestic demand of gold internally and reduce the need for gold imports, benefitting the Indian economy in more than many ways. It is also psychologically a healthy step to make the people emotionally part with their gold and look at it as an investment tool instead of an emotional inheritance.

Sovereign Gold Bond Scheme

Gold bonds are considered to be the best and the most secure investment option in the country. Rather than investing in gold in its physical form, investors in India can instead buy sovereign gold bond from the RBI that come with a minimum tenure of eight years with multiple exit options. The bond assures a minimum return of 2.75% interest payable bi-annually.  Capital gain tax exemption, indexation etc are few added benefits to this new gold bond.

Ashok Chakra Gold Coins

Ashok Chakra gold coins

Gold coins embedded with Ashok Chakra were launched by the government in a denomination of 5 gm and 10 gm. Gold bars of 20 gms can also be bought from MMTC outlets across India.

All in all, these new schemes will help India combat its current account deficit and trade deficit by making the country self sufficient in Gold consumption, also hoping to expect exports to some extent. All things considered, there’s a whirlpool of growth again Indians. Stay tuned!

How Do Fluctuations In The Gold Rate Affect The Indian Economy?

Gold is an integral part of our investments, an ultimate financial asset that every household in the country wants to acquire as much as possible. There is a unique trust in gold that we Indians have held for past many centuries and will continue to do so, unaware of what our investment in gold would mean to the Indian economy.

Fluctuations In The Gold Rate

Apart from the large chunk of extra or spare income of our households going into gold for long term investments affecting the liquidity and fiat currency in the county, the fluctuations in gold prices also has several effects on the economy and financial markets.

What Happens When Gold Prices Fall?

As gold is considered to be the ultimate investment tool in the eyes of many, a slight dip in gold prices globally also creates an exciting situation where every investor is willing to sell off the stocks, liquidate the fixed deposits and call off their funds and bonds to invest in gold. This causes a panic in the Indian stock markets and sudden drop in the indices. The bottom line is- whenever gold is available even at a tad cheaper price, there is a surge to buy more and more gold. This may not affect the gold prices because they are regulated globally, but this surely causes panic selling in the stock markets and brings in liquidity crunch.

What Happens When Gold Prices Rise?

Not all might want to pour out their jewellery box or empty their bank lockers to sell off their gold when the price of gold rises globally. There are many people who look at gold as a family wealth, a security or a very long term investment. However, all those who invested in gold or have been looking for an opportune moment to dispose of the asset and get their hands on some fiat currency, will not miss the opportunity. Many others will postpone their plan to invest in gold and will rather look towards fixed deposits, mutual funds, stocks and even real estate.

Income Tax Law on Gold Jewellery Clarified

Post demonetization, there have been many misunderstandings, confusions and rumours about government’s plans to seizing gold from households, new restricting limit of gold holdings and what not. Here’s a quick synopsis of gold income tax law based on the recent press release issued by the Commissioner of Income Tax.

Gold Holding Limit:

Gold holding limit

If you can disclose the source of income for gold acquisition and holding, there is no limit to the amount of gold holdings allowed by the government of India and the income tax department. Gold ornaments, bullions, coins etc that have a signed invoice with the date and place of purchase can be held by any individual in the country, irrespective of their age, sex and income. The law is also applicable to gold inheritance. If the gold is acquired through family inheritance, there are no taxes levied upon it.

Search and Seizure Warrant:

The search and seizure of gold jewellery is based on the circular dated 11.5.1994, and no recent changes have been made to it. The only cause of worry about search and seizure is the probably of it happening, which was not expected in the last decade.

Allowed limit without income record

Income Tax Law on Gold Jewellery Clarified

A married woman is allowed to keep 500gms of gold with her, an unmarried woman can have 250 gms of gold and ornaments while men are allowed 100 gm of gold even if they cannot furnish the income record and the source of income for their gold possession.

Exceptions for Family Customs

Search and seizure are done on the officer’s discretion and he might choose not to seize high quantity of gold if the family traditions and customs, and other regional exceptions are implemented.

So ladies, if you have been accumulated small gold jewellery even from your pocket money, there is nothing for you to worry about, if it does not exceed the allowed limit or if you can furnish the income details to support your bills and purchases.

Best Ways to Invest In Gold 2016-17

Buying gold doesn’t always mean jewellery shopping or preparing for daughter’s wedding. In fact, gold jewellery came into existence because gold is a safe long term investment. But apart from jewellery and ornaments, there are several other ways to invest in gold which are more safe, secure and rewarding over a period of time. However, if wearing trendy and impressive precious jewellery is your thing, investment and return on investment is the last thing to think about.

So here are some of the best ways to invest in gold:

Gold ETFs

ETFs

Also sometimes referred to as paper gold, Exchange traded funds that deal with gold are one of the best and the safest way to invest in gold. Without worrying about the purity of gold and safekeeping of your asset, this paper gold can be bought or sold on paper just like shares in the stock market. The global gold pricing is considered for trading in gold ETFs.

Gold Coins and Bullions:

dutch-gold

Gold biscuits aren’t just good for smuggling as seen in the movies. Buying gold coins, biscuits and bullions are the best way to invest in gold if you believe only in physical gold and not a document. These gold bullions, coins and bars are made with purest physical form of gold which cannot be casted into intricate shapes without adding impurity as it is done to mould jewellery out of pure gold. These 24K gold bars and bullions can be safely kept in home or bank lockers.

Gold Funds:

Less physical demand

These are not the ETFs we just spoke about; rather, these are funds of funds that trade in gold. You can invest in gold ETFs through a fund manager without holding and maintaining a Demat and online trading account. This is done with a help of a document of agreement as it is done for any other type of mutual fund or ULIP plan.

Gold F&O:

Gold F&O

Futures and Options can be traded in the commodity market with the help of online trading account and a trading terminal. Although a complicated and sophisticated investment ad trading tool, F&O can sound like French to amateur investors. This can also prove highly risky for someone with little or half knowledge, although it’s a wonderful tool regularly used by professional and regular day traders as well as short to long term traders and investors.