As people's debt problems mount, they become increasingly desperate for money in which to pay their creditors. A recent business model that has sprung up out of this desperation is the cash for gold companies.
As the name suggests, these companies offer you money in exchange for your old gold, silver and platinum, usually in the form of jewellery. Earlier this year Which? Money warned that these gold buying companies offered 'shockingly bad value'.
Which? launched an investigation into these companies and found that, on average, the cash for gold companies that advertised on TV offered just 6% of the retail value of their gold, whereas pawn brokers and high street jewellers offer around 25%. This is a shocking revelation and clearly shows that these businesses are taking advantage of people in debt and in need of cash quickly.
The group sent three pieces of brand new gold jewellery, collectively worth £729, to four groups that promise to buy old gold for cash, as well as to three pawnbrokers and three independent jewellers. It found the TV gold buyers consistently offered the lowest prices, with CashMyGold offering just £38.57 for all three pieces of jewellery, including quoting just £9.64 for a 9 carat bangle that had been bought for £215, and for which an independent jeweller offered £54.
Obviously, there is nothing wrong with these companies if you are trading jewellery that you no longer want, and you are getting a good deal on the trade. If, however, you are desperate for the money then contacting a reputable debt management company is by far your better option.
To contact a trained debt management advisor call freephone 0800 988 7701
