How to Select a Bonded Diamond

A bonded diamond is a stone that comes with a wide variety of benefits and insurance not available to "ordinary" stones. Bonded diamonds are of the highest quality and are often inspected vigorously to insure their caliber. A bonded diamond will often cost several times more than a diamond of equal value, size, and attributes that is not bonded. However, there are many benefits to owning a bonded diamond. Read more to learn how to select a stone that meets your specific needs.

Difficulty: Moderate

Instructions

Things You'll Need:

• Bonded jeweler

1. Decide if you are making an investment purchase. The greatest benefit to owning a bonded diamond is that it can be resold at a rate that includes the projected inflation and incurred appreciation. Some bonded diamonds only increase in value when traded-in or sold as part of a "buy-back". If you plan to purchase the diamond as an investment, make sure the policy includes a trade-in or buy-back allowance.

2. Set a budget for the diamond. Because bonded diamonds are significantly more expensive than an equivalent non-bonded diamond, decide how much money you will spend on the purchase. Although you will pay an increased price for a bonded diamond, you will have greater security for the jewelry.

3. Contact several bonded jewelers. "Shop around" for a bonded diamond policy, in the same way you would compare price and benefits when purchasing a car. Contact multiple bonded jewelers and encourage each to compete for your business. Explain that you are in contact with several companies and require pricing information. Be polite, but firm and realistic. Keep in mind that you may have to travel to find several bonded jewelers.

4. 
    
   If you frequently trade your jewelry in and up, then a bonded diamond is likely a good investment for you.

   Compare benefits and pricing information. Bonded jewelers can have slightly different policies, so do your research. For example: If you do not plan to sell your diamond back to the jeweler, but expect to "trade up" for a different piece of jewelry in the future. Make sure the projected appreciation and inflation rate allows you to trade-in the jewelry.

5. Make your purchase. Once you have selected a stone and are comfortable with a particular jeweler, buy the diamond of your choice. You have successfully protected the diamond against damage as well as secured the right to trade-in or sell the stone back should you wish to do so.

Tips & Warnings

• Consult a jewelry expert and financial adviser before making any decisions.
• Make sure you understand the level of risk before making the purchase.