Are diamonds a good investment?
A good investment is something that will bring you
a return on your money
within a relatively short time.
When it comes to diamonds they are very unique.
A diamond purchase of $1,000 dollars in 1971 would today sell for about $10,000
dollars.
With no damage it would bring you a cash offer of about $3,000 to $4,000
depending on the shape, condition, and marketability of the diamonds.
As you can see in 25 years the average per year increase was on the high side
14%
and on the low side 8%.
With such large increases you might think that they are a good investment,
but you have to consider the most important factor in having an investment.
That is taking the profit.
I don’t know many people who are willing take the profit
by selling their
jewelry or wedding rings.
The other considerations are that in the mid 70’s diamonds skyrocketed.
A large percentage of the inflation over 25 years really came over about a five
year span.
Also the mark-up paid at the time you make your diamond purchase
may very
as much as 50%.
If you pay a higher mark-up it takes much longer for inflation to get you
to even.
I think with today’s inflation on diamonds it takes on average,
about 10 years to get you to a point of selling a diamond for what you paid.
That’s why at Randy’s Jewelry we will never use
“Diamonds are a good investment”
as a sales tool.
What we do tell our customers is that diamonds are a very unique product
and that you can possess them and enjoy them for many years.
And, given a long enough period of time, they will be worth more than what you
paid.