How to Get the Best Deal on Diamonds and Avoid Rip-offs
Last updated in January 2017
Because diamonds are graded using several complex measures, and because they’re so expensive, the business attracts lots of scammers and shady salespeople. Put simply: It’s easy to pay way too much or get ripped off. Here are tips for getting a smooth sale.
Getting Good Advice
Educate yourself. The best way to protect yourself from a dishonest diamond dealer is to demonstrate you know what you’re doing. The info and advice we present of how diamonds are graded and priced and our tips on what you should (and shouldn’t) care about is a good start. The customer reviews of jewelry stores here at Checkbook.org will also help you find helpful, trustworthy retailers. The best jewelers provide low-pressure environments and give customers value-centric crash courses in diamonds. A good store should also let you inspect and compare numerous stones and offer customizable settings. Feeling pressure or having difficulty getting a firm price quote? Walk away.
Beware of Scammers
If you’re shopping for a large diamond, tell retailers you’ll consider only gems with full Gemological Institute of America (GIA) reports. If the store can tell you only that a diamond is “certified,” without a designation from the GIA or other reputable organization, ask to see something else. Generic certifications tell you nothing about stone quality.
Prepare for a Wait
Give yourself plenty of time. It takes a few days or weeks for loose stones to ship to the store. If you pick a custom setting, or order around holidays like Christmas and Valentine’s Day, you’ll wait even longer.
Compare Loose Stones
Because some stores pre-set lousy diamonds to hide flaws, tell retailers you’re shopping for a loose stone or stones and will focus on setting and design decisions later.
If a store shows you just one stone, that’s a red flag. The more diamonds a seller can trot out the better. But be wary of retailers that start by asking you to compare very dark stones with very light ones, or to judge well-cut gems against poorly cut ones. These comparisons are often intentionally simplistic and done to push customers into paying too much for clearly superior stones.
Instead, ask to compare at least a half dozen stones of similar cut, weight, color grade, and clarity. Review each stone’s GIA report; determine whether or not defects and differences are visible and whether the differences matter to you. The more stones you examine the more comfortable you’ll get at discerning good-looking diamonds from bad ones.
As you compare, focus on value, thinking about whether or not you care about very small or even undistinguishable differences. We’ve already discussed this but it bears repeating: You’ll get a lot more bang for your extra bucks by buying an excellent-cut diamond. But if you can’t otherwise discern differences in quality between two stones, don’t pay more for the higher-quality stone. Most shoppers should avoid paying extra for diamonds with color grades above F or with clarity scores better than SI1. And avoid stones that weigh in at popular or round-number carat cutoffs.
Shop for Price
We report here the range of prices quoted to Checkbook’s undercover shoppers when they contacted a sample of Chicago area stores and online retailers to collect their prices for any GIA-graded loose diamonds they would offer that fell within the following narrow parameters:
- Stone A—Excellent cut, 1.50–1.55 carats, VS1 or VS2, G or H color, no fluorescence
- Stone B—Excellent cut, 1.00–1.05 carats, VS1 or VS2, E or F color, no fluorescence
When collecting prices for products we prefer to compare identical items. But that’s usually not possible to do when shopping for diamonds. Even for a narrow set of parameters, you’ll find there are hundreds of diamonds on the market, and if you compare using GIA identification numbers you’ll find that for the most part stores don’t offer the exact same item. If you specify diamonds using similar criteria that we used, you’ll find that some stores will offer you only one or two choices, but most will offer at least a handful of options, and the websites of large jewelry store chains and online-only sellers will have hundreds in inventory (for our price survey, we collected prices from the large chains’ websites, where available).
But having many choices actually works in your favor by giving you the chance to make a value play. Remember, among similarly graded and sized stones, differences that are imperceptible can still have a big impact on price. You’ll want the opportunity to select from lower-priced stones that will—at least in your judgement—do just as well as higher-priced options. As you can see from the results of our price surveys, for each of our set of parameters, some stores offered choices that represented big ranges of prices. For example, for the larger diamond we shopped, Bryn Mawr Jewelry offered five different stones that ranged in price from $14,908 to $19,011.
Among the local stores our undercover shoppers surveyed, you can see that they were quoted dramatically different ranges of prices for our very similar sample diamonds. For the larger stone, James & Sons, Jared Galleria of Jewelry, Kay Jewelers, State Street Jewelers, Stones Jewelry, and Zales offered prices of $17,300 or more, compared to prices of $11,623 or less from Harrison Jewelers, Paul Young Fine Jewelers, and Sandberg Jewelers. Prices available from online-only sellers were even lower. Click here for more info on buying online.
Costco’s prices also were among the lowest we found. It offers limited selection of diamond jewelry and didn’t have anything that exactly fit our specifications. Costco didn’t provide information on cut quality, and for the sizes we shopped offered only color grade I and clarity grade VS2. The prices we report are for what we identified as the items it offered that compared closest to our parameters.
Tiffany also didn’t offer any products that exactly fit our specs, but, as you can see, its prices were very un-Costco-like.
Sometimes our shoppers could use supplied GIA numbers to see that the exact same stone was offered by multiple stores (many jewelers use the same distributor). In these instances, we still found sizeable price variations.
The message is as clear as, well, a flawless diamond: Shop around. Figure out what you want to buy. Decide on shape and on a narrow range that you’ll accept for carat, cut, color, and clarity. For example, you might decide to shop for an excellent-cut round brilliant weighing 1.6 to 1.65 carats, with color grade between G and H and VS1 or VS2 clarity. Then get pricing from several stores for diamonds they can supply that meet your specs. When you ask for prices, let each store know you’re contacting several retailers. Doing so will prompt most stores to offer their lowest prices and eliminates awkward negotiations.
Ask for GIA report numbers and then look up each of the stones offered at www.gia.edu. Use those reports and the info we provide to make your final choice.
Beware of Trends
Unless you’re a ginormously rich celeb, a diamond is, if not forever, hopefully a very long-term commitment. On your 20th anniversary, you might not want to look down at a ring design or diamond cut that’s the leisure suit or pillbox hat of the jewelry world. While you can always have your so-2017 heart-shaped stone re-set, it’ll cost you, and most of us would rather form sentimental bonds with designs that hold up over time.
Consider Less-Expensive Gems
As noted, because the diamond market is controlled by a handful of companies, compared to many gemstones diamonds are overpriced. Sapphires, rubies, and other stones offer similar dazzle at significantly lower prices.
If you want a lot of diamond for not a lot of dollars, consider buying a ring designed with a cluster of small diamonds. It will cost far less than a comparable-size single stone, and your nosy frenemies won’t notice the difference unless they get close.
Review the Return Policy
Buy from stores that offer returns with a full refund within 30 days. But if you purchase a custom setting, know you’ll likely pay for design and fabrication costs. Have the store put in writing how much of a refund you’ll get in that case.
Pay by Credit Card
If a store doesn’t come through, you’ll have the option of disputing a credit card charge under the federal Fair Credit Billing Act and the consumer-friendly policies of the credit card companies.
Avoid High Interest Rates
Although chain and department store salespeople might offer steep discounts for signing up for a new credit card to pay for your purchase, these cards (and offers that let you defer payments for months) usually impose high interest rates.
Get an Appraisal
After purchasing an expensive diamond, take the stone to an independent appraiser. Although you’ll have to pay about $50 to $200 for the appraisal, it’s good insurance against being given—either intentionally or by mistake—a switched-out gem that’s of lower quality than what you paid for.
Have an appraiser look at an item after it’s been repaired or resized to protect against switcheroos. In 2016 Kay Jewelers faced accusations from dozens of customers who claimed their diamonds were swapped for lesser-quality stones when they took in their rings for cleaning and repairs.
When getting appraisals for jewelry, don’t expect the retail and appraisal values to match; the appraisal amount will usually be much higher. If the jeweler provides or arranges for the appraisal, this phenomenon is often a byproduct of the jeweler trying to make a customer feel like they have just received a good deal.
Also, the purpose of an appraisal is to estimate the replacement cost for insurance purposes in case the item is lost or stolen. To save money on insurance premiums, there is no need to insure a diamond for more than what you paid. The resale value for diamonds, on the other hand, is much lower than retail. You would be lucky to sell your diamond for half of what you paid for it, due to low demand for “used” diamonds and a limited marketplace (retailers, wholesalers, pawn shops, or directly to another consumer). Several online gold and diamond buying websites have popped up in recent years, easing the resale process. Nevertheless, a diamond isn’t a good financial investment.