💎 Is Jewellery a Smart Investment?

We all grew up hearing: “Buy gold, beta.”
But most of us ended up buying jewellery, not pure gold.
And that’s where the confusion — and disappointment — starts.
Every week someone proudly tells me,
“Sir, I bought jewellery… good investment for my future.”
Yes, jewellery is emotion, tradition, beauty.
But as an investment?
It silently erodes wealth in ways most people never calculate.
It's tempting to think of that beautiful necklace as a financial asset, but when we look closely, it's generally not a good investment. Here’s why, presented simply:

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The Hidden Costs and Hurdles

• 1. The "Making Charges" Trap:

When you buy jewellery, you're paying for two things: the value of the pure metal (like gold) and the craftsmanship (labor/design cost). This craftsmanship fee, known as "making charges," can easily be 10% or more of the total price. Making Charges is money that evaporates the moment you step out of the store.
    What this means:
If you spend ₹1,00,000, only about ₹90,000 of that is the actual gold you own. The other ₹10,000 is a cost (Making Charges) you will never recover.
If an investment starts with -10%, is it really an investment?

 

• 2. The Selling Penalty: (They deduct money again!)

When you return to sell or exchange the jewellery, the jeweller again deducts 8–12% for:

• wastage
• melting
• impurities
• polishing

So now your ₹90,000 gold value becomes around ₹81,000.

Forget returns — you’re struggling to break even.

Gold has to appreciate 20%+ just for you to touch your original ₹1,00,000.

That's a very high bar for any investment.

• 3. The Drag of LOCKER cost:

·        Big-ticket jewellery means locker.
Locker means annual rent.
Annual rent is a leak — the kind of leak that looks small but destroys long-term compounding.

·        It’s like keeping money in a bucket with a tiny hole.
Slowly… silently… it keeps dripping.

Over time, they chip away at any modest gain the gold price might have made.

 

• 4. The Liquidity Problem (Will You Sell?):

A true investment should be easily and quickly convertible to cash. Most people buy jewellery for sentimental value (gifts, weddings, heirlooms). You might intend to sell it one day, but the emotional attachment or its role as a family piece often prevents you from doing so.
Most families never sell jewellery and even during emergency.. they will think 100 times before considering selling jewellery.

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TO SIMPLIFY THE ENTIRE GIST….

Let's say the current price of gold is ₹50,000 per 10 grams.

Action	Cost/Value	Explanation
Buy Price	₹1,00,000	Initial cash outflow.
Less: Making Charges	- ₹10,000 (10%)	This cost is gone immediately.
Pure Gold Value	₹90,000	This is the actual metal value you own.
Sell Deduction	- ₹9,000 (10% of $₹90,000$)	Jeweller's deduction when you sell.
Final Cash Back	₹81,000	Your return if the gold price hasn't moved.

In this scenario, to get your original ₹1,00,000 back, the market price of gold must rise significantly to recover the ₹19,000 loss!

The Verdict

Enjoy your jewellery for its beauty, meaning, and pleasure. Treat it as a luxury expense or a treasured heirloom. So What Should You Do?

If you truly want to invest in gold — 3 smart choices exist:

✔ Sovereign Gold Bonds (SGBs)

• 2.5% assured interest
• No making charges
• No storage cost
• No capital gains tax after 8 years
• Pure, transparent gold exposure

✔ Gold ETFs

• Buy anytime, sell anytime
• No emotional bias
• No deductions
• Tracks gold price cleanly

✔ Gold Mutual Funds (FoFs)

• Simple like SIP
• No demat needed
• Easy and transparent

These are investments.
Jewellery is expenditure wrapped in glitter.

Final Thought

I’m not saying don’t buy jewellery.
Buy it. Enjoy it. Celebrate it.
But don’t call it “investment.”

Serious investors don’t mix emotion with wealth creation.
They separate fashion gold from financial gold.

And that’s why they stay ahead.

Build memories with jewellery.
Build wealth with smarter gold vehicles. #DontRetireRich

 All the best,

Regards,
Srikanth Matrubai

MUTUAL FUND DISTRIBUTOR

REBALANCE VOLATILITY CERTIFIED COACH

Srikanth Matrubai, Author of the Amazon Best Seller DON'T RETIRE RICH

You are strongly encouraged to consult your financial planner before making any decision regarding this investment. The views expressed here are the author's personal views and should not be interpreted as a recommendation to invest/avoid.

This post is for educational purposes only.
(Disclaimer: Equity investments are subject to market risk. Contact your registered authorised partner).
 

Srikanth Matrubai Author of the Amazon Best Seller DON'T RETIRE RICH

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