Many people don’t realize that the shopping season in the United States between Thanksgiving and Christmas is also the most popular time of the year for couples to get engaged.
While most of you will be stressing about what to get Mom and Dad and all of your loved ones for the holidays, a few of you will be faced with one of the largest purchases of your life—a diamond engagement ring.
It’s an unfortunate irony that this (hopefully) once-in-a-lifetime purchase is also the one that people understand the least and therefore most commonly overspend on.
So if you’re one of the lucky few popping the question this holiday season, here are five of the most common pitfalls that guys stumble into when purchasing diamonds. Steer clear of these, and you’ll save yourself significant cash.
Don’t Take It So Seriously
Finding the woman you love? It’s the greatest accomplishment of your life.
Deciding you want to spend the rest of your life with her? It’s the biggest decision you’ve ever made.
Buying a product whose demand has been manufactured through manipulative advertising paid for by the people with a monopoly over that product? It’s best to take it easy.
She, and all of her friends, might have bought into De Beers marketing, but that doesn’t mean you have to.
You see, the industry wants you to believe that there’s a direct correlation between how much you spend on the diamond and how much you love her. When you walk into a jewelry store, they’ll tell you all about the symbolism and meaning that the ring represents.
But the fact is that 100 years ago, virtually nobody proposed with diamond rings. It’s a modern phenomenon created out of thin air by a diamond-mining conglomerate that needed to figure out how to make their stockpile worth more money.
What does this mean for you? Unfortunately, marketers have been extremely successful indoctrinating the diamond myth into the public mindset.
What I recommend to readers of my diamond education website is to spend the least amount of money possible to get the maximum effect. Any dollar spent on a feature of a diamond that won’t be noticeable to the naked eye is a dollar wasted on a myth.
Don’t Buy at a Brick-and-Mortar Jewelry Store
Online diamond vendors have completely transformed the jewelry industry—and for good reason.
Jewelry stores either have to buy diamond inventory or take stones on consignment from wholesalers.
If a store buys its inventory, it’s going to have to take massive loans to cover the purchase. Carrying even a moderately sized diamond inventory can cost several million dollars, and carrying a loan of that size is hugely expensive. That expense is always passed on to the consumer.
If a store takes diamonds on consignment, the price it receives from the dealer is going to be significantly higher than the purchase price because the dealers are essentially letting the store borrow the diamonds for an extended period of time.
The dealer then loses the opportunity to sell those diamonds to anyone else. That privilege comes at a price—a price that is passed on to the consumer.
The genius of online diamond merchants is that they sidestep both of these issues. These virtual stores don’t own any diamonds, and they don’t borrow diamonds.
They import lists of inventory from participating diamond wholesalers with all the accompanying details. They list these diamonds as their own.
When a sale is made, the dealer ships the stone either to the consumer (if it was purchased loose) or to the store’s jewelry division where the stone will be set.
Because these dealers are only virtually listing their merchandise, they’re free to sell their diamonds to anyone they want. If they sell something that’s virtually listed online, they simply remove it from the feed and the stone disappears online.
Because there’s no opportunity cost for the dealers, they’re happy to list their diamonds at their selling prices as opposed to their consignment prices. And since the online stores aren’t paying for their virtual inventory, there are no high-interest payments that need to be made.
These passed-on savings coupled with the fact that competition between online vendors is at an all-time high make buying your diamond online a no-brainer.
Don’t Go for the Highest Color Grade
If you browse a jewelry store’s inventory (either online or offline), you’ll find that the diamonds will be graded in color from J or sometimes K at the low end to D at the high end.
Consumers faced with a decision between these two extremes tend to think that since there are so many options, they had better pick something higher up in the scale (or, at worst, something in the middle) to avoid an ugly yellowish-looking diamond.
It’s true that if you hold a J-color diamond next to a D, you would be able to see the difference; but taken on its own, a J-color ideal-cut round diamond will look colorless to the naked eye.
The analogy I like to use is teeth. There are people with “regular” white teeth and there are people with insanely white teeth. For the people with regular white teeth, you would never notice that their teeth are not as white as possible until they stand near someone with triple-bleached, glow-in-the-dark teeth.
Additionally, since color grades are so finely divided, you can’t easily see a difference in color (even when compared side by side) unless you make a jump of two to three grades (that is, from J to H or G).
So even if you wanted to make a meaningful upgrade, it’s probably going to cost you more than you think.
To put things in perspective, going from a J color to an F color will add about 20 percent to the price, while upgrading to a D color will add over 45 percent!
Here’s a quick rule of thumb: Since anything set in yellow gold will absorb the color anyway, it pays to go as low as possible in color.
Otherwise, for round diamonds, stick with I or J color. For princess and emerald cuts, H or I. For everything else, stick with G or H. Check out this video here.
Don’t Go for the Highest Clarity Grade
The typical range of clarity offered at most midrange jewelry stores is as follows (from worst to best): I1 (Included), SI2 and SI1 (Slightly Included First and Second Degree), VS2 and VS1 (Very Slightly Included), VVS2 and VVS1 (Very Very Slightly Included), and IF (Internally Flawless).
As with color, when most people are presented with such a wide range, they tend to believe that they need to be somewhere near the high end of the spectrum for fear of ending up with an ugly diamond littered with imperfections.
This is where people end up wasting the most money. The little-known fact about diamonds is that an eye clean (meaning imperfections are not visible to the naked eye) lower-clarity diamond (SI2, usually) will look identical to a flawless diamond assuming that all else is equal. Unlike color, you actually get nothing in return for paying for high clarity grades.
Some perspective on clarity: Upgrading from an SI2 to a VVS2 could easily cost over 80 percent more! That’s 80 percent more money that will get you absolutely nothing visibly noticeable in return.
Always shoot for the lowest clarity grade you can get away with that is still clean to the naked eye.
Don’t Fall for the Loose Certificate Trick
It’s bad enough that you have to learn an entirely new language to effectively buy a diamond. Unfortunately, though, you also have to be on the lookout for unscrupulous jewelry salesmen looking to trick you into a bad deal. Just knowing the sweet spots in the 4 C’s of Cut, Clarity, Color, and Carat isn’t enough to guarantee great value.
There are basically two gold-standard diamond certificates in the industry: GIA (Gemological Institute of America) and AGS (American Gem Society).
To guarantee that you’ll get a fair deal, limit your search to jewelers who use these certificates exclusively.
The most common question we receive on our website is: “I found this EGL (European Gemological Laboratory) certified diamond that looks like such a great deal! I know EGL is looser on their grades than GIA, but even if it’s off by a couple of grades it still seems like a great deal. Should I buy it?”
The answer, in nearly 100 percent of the cases, is an emphatic NO. (See the accompanying video where I send the same diamond to three different labs).
I discovered that by taking a diamond already certified by GIA and sending it to EGL Israel, I would have been able to sell it for 70 percent more money. That’s 70 percent more money for the exact same diamond—just with a different piece of paper!
So if you’ll be getting down on one knee this holiday season, it will be much easier if your wallet is weighed down with all the cash you saved by buying a diamond intelligently.
Ira Weissman is a diamond industry veteran with nearly a decade of experience at one of the world’s largest diamond polishers. He has traveled the world buying and selling diamonds and now dedicates his time to helping consumers make the most of their diamond buying decisions. He has been featured on Anderson Cooper, CNBC, The Huffington Post, and has been quoted by MarketWatch, The Village Voice, and BankRate. Visit Truth About Diamonds (www.truthaboutdiamonds.com) to educate yourself about diamonds and for free help in your diamond search according to your budget and needs.
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