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Last Updated on: 8th October 2021, 04:28 pm
If you have old silver items laying about, you might want to consider cashing them in for scrap. This way, the precious metal that they contain can find a new life, and you can make your wallet a little fatter in the process.
The problem is that, more often than not, “cash for gold” and “cash for silver” shops take advantage of unsuspecting sellers who aren't aware of their item's true value. To protect yourself from scammers and seedy pawnshop owners, you need to do your homework.
Your best defence is to find out what your silver is worth. Luckily, you don't have to be a professional gemologist to do this. For this article, our team of precious metals experts put together a short guide to determining your silver jewelry, bullion, or coin's scrap value.
Table of Contents
Calculating Silver Scrap Value (Manually)
Silver scrap value is a function of the spot price of silver. First, note that most silver items are not pure but rather an alloy (i.e., mixed metal) that must be melted and refined to retrieve the precious metal it contains. However, the silver spot price represents the live rate at which pure (i.e., >99.9%) silver is being traded on silver futures markets. Therefore, expect a discrepancy between the spot price and what your silver item is worth at resale.
To begin, take the most accurate silver spot price and divide it by 31.1, since there are 31.1 grams in every troy ounce, which is the customary unit of mass in the precious metals industry. At the time of writing, on October 5th, 2021, the silver spot price is $22.51 US per troy ounce, which converts to about $0.72 per gram (22.51/31.1).
Next, weigh your silver item in grams. For example, a typical sterling silver necklace (.925 purity) might weigh about 44 grams. Since sterling silver is 92.5% pure, the necklace only contains 40.7 grams of pure silver metal (44*.925).
If sold at our given spot price, this necklace would therefore be worth $29.30 on the open market (40.7*.72). But since the buyer has to also make a profit, you might reasonably be offered anywhere in the range of $23 to $27 for the item.
For reasons we're about to discuss, silver scrap value is lower than the silver spot price. In general, you should seek 80-90% of the spot price from a silver buyer for the weight of the silver content in your item (not the total weight of the item itself).
Selling Silver for Scrap: A Brief Guide
We'll cut right to the chase. Chances are, you’re not going to get spot price for your silver jewelry. Unless you have a pure silver item and a highly charitable buyer who isn't interested in making a profit for themself, selling at a loss is an inevitability. Successfully selling scrap silver simply comes down to managing your losses so that both parties walk away happy.
After all, a buyer has to sell their purchase to a melter or refiner, who might give the buyer 90% of the spot value of the silver. Since the buyer also has to make a profit to make the transaction worthwhile, you can expect to receive somewhere in the range of 75-90% of spot value, depending on the item. These losses are merely the costs of doing business.
In other words, just because sterling silver is 92.5% pure doesn't mean you're going to get 92.5% of the metal's spot price.
To get the best deal, it's generally a good idea to avoid “cash for silver” shops altogether and thereby cut out the middleman. Instead, pitch your items directly to reputable jewelers or melters. Failing that, you can list your items on the open market through auction websites and precious metals-dedicated classifieds, such as:
Testing Your Silver Item's Purity
There's no way of knowing what your silver is worth unless you know its level of purity (also known as “fineness”). Unless it's a numismatic silver coin, it's likely that the purity is engraved as a hallmark on the item itself—usually, these are denoted as “.925”, “.958”, or “.999”, which stand for sterling, Britannia, and pure silver, respectively.
In some cases, hallmarks aren't engraved on the item or have been rendered unreadable due to years of degradation. In the event that there's no visible hallmark, you have to do a silver purity test to discover its fineness. Below, we've listed the most common ways of determining silver purity.
- Nitric Acid Test: Applying a few drops of a store-bought nitric acid solution on a silver item will indicate if you have a genuine silver item or merely a silver-plated one. The solution reacts with the silver metal to produce a certain color if it's pure silver, another if it's sterling silver, or it simply will not react at all if it's silver-plated.
- Bleach Test: Although we wouldn't recommend it, if you're in a pinch you can test silver by dropping a very small amount of household bleach on your item. Silver reacts strongly to oxidizing agents like bleach, which will cause real silver to rapidly tarnish. This method is best used for quickly testing an old coin or silverware collection.
- Ice Cube Test: Silver is a heat conductor, which means ice cubes will melt faster on a silver item than on a countertop. Place an ice cube on a piece of suspected silver and a non-metallic household surface simultaneously and watch to see which melts faster.
- XRF Analyzer: Many reputable jewelers own x-ray fluorescence (XRF) equipment that can precisely determine your silver or gold item's fineness. Enquire with your local jeweler about conducting an XRF test for determining a metal's purity or karat weight.
With time, experienced silver collectors—or “silverbugs”, as we affectionately call them—learn how to determine authentic silver simply by its look and feel. For the uninitiated, here's a helpful guide for avoiding counterfeit silver jewelry and quickly identifying fake silver coins.
Short on Time? Use a Scrap Silver Calculator
If you don't have time to manually determine your silver's scrap value—or you simply don't trust yourself to do the math—then, luckily, there are scrap silver calculators that can do the trick. These free tools do the arithmetic for you to minimize the chances of human error. Using a silver value calculator can provide you with a good idea of what your possession is worth before you take it to the resale market.
However, you're never going to get an accurate idea of what your silver is worth unless you know the up-to-date silver spot price. The spot price is the current average rate at which a troy ounce of silver is trading, and is updated daily by the COMEX division of the New York Mercantile Exchange as well as the London Bullion Market Association (LBMA).
Don't trust unreputable sources to provide an accurate silver spot price. Instead, use our up-to-the-minute silver spot price page for the most reliable data, sourced directly from the COMEX and LMBA at 12:00 p.m. GMT every day.