Buying an Engagement Ring

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This week on the good guys to know podcast, we discuss how to buy an engagement ring.  As a guy, your endeavour to find an engagment ring might be your first step into the world of the jewelry store.  Don’t worry, after this podcast you will be able to waltz through the jewelry store like you own the place!  Thanks for listening!

Buying an engagement ring marks an exciting time in a good guys life.  However, the stress of entering a jewelry store and finding the perfect ring can be a very stressful experience.  There are a couple things that all guys should know BEFORE they set out to find the perfect rock for Jenny from the block.

 

  1. 4 C’s of Diamond Classification

GIA  (Gemological Institute of America) created the first international diamond grading system and the 4 C’s of the diamond industry.  The 4 C’s were created because no two diamonds are exactly alike and until the 20th century, there was no agreed upon standard by which diamonds could be judged.

–       Color – Color actually means lack of color.  The purest diamond is chemically pure, structurally perfect, and has no color.  The color scale goes from D-Z, D being colorless and Z being yellowish.

color

Side note: the color grading system starts at D because earlier color grading scales only incorporated A,B and C.  GIA wanted to create a scale that was completely distinguishable from the earlier classification system and so, started with D.

–       Clarity – Clarity refers to the absence of inclusions or blemishes.  While no diamond is perfectly pure, fewer blemishes = higher value.  Grading goes from flawless (FL) to very, very slightly included (VVSI) to very slightly included (VSI) to slightly included (SI) to included (I)  Most of the differences in clarity are to small to be seen by anyone except a diamond expert using 10X magnification.

Clarity

–       Cut – Cut is the way that a diamond unleashes its light, the way it shines and sparkles.  It is graded from excellent to poor.  It is more than just a diamonds shape (round, emerald, pear).  Of the 4 C’s, it is the most complex and difficult to analyze.  Cut can be broken down further into: Brightness, Fire and Scintillation.  Brightness is how white light is reflected from the diamond.  Fire is the scattering of white light into the colors of the rainbow.  Scintillation is the amount of sparkle a diamond produces and the pattern of light and dark areas caused by reflection.

–       Carat – Carat refers to how much a diamond weighs.  A metric carat is defined as 200 milligrams.

Side note:  The modern carat system is based on ancient diamond measurements that were based on the carob seed.  Early gem traders used these seeds as counterweights to measure diamonds.

 

 

 

Tips for Buying Engagement Rings:

1.  Avoid the “magic sizes” for diamonds.  For carat of a diamond, often times a 1-carat diamond will cost significantly more than a .99 carat diamond.  It may be beneficial to your wallet to avoid the “magic sizes” of diamonds, which are half carat, three-quarter carat, and 1 carat.

2.  Stick to your budget.  Go in to the jewelry store with a solid idea of how much you want to spend on a diamond.  Feel prepared to walk out of the store without purchasing a ring.  With a purchase this big, it is ok to visit multiple stores before you pull the trigger.  Also, the ‘ol myth of spending 2-3 months’ salary on a ring is bogus.  Spend what you are comfortable with and who knows, your lady-to-be might rather spend some extra cash on a honeymoon than have a gigantic rock.

3.  Be ready to negotiate.  For instance, if you are willing to pay cash, it is possible that the jeweler may be willing to give you a 3% discount because that is roughly the fee that many credit card companies charge for processing.  Also, summer tends to be a slow time of year for jewelers, which may allow for more negotiation on the price.

4.  Ask for the grading report.  This will allow you to see the scientifically determined 4 C’s of the diamond.  It will also serve as a way to prove to the jeweler that you know what you are talking about.

5.  Match the engagement ring to jewelry she already wears.  If she likes classic jewelry, look for a classic engagement ring.  If she likes chunky, ornate jewelry, get something big and flashy.

6.  Find out her ring size.  You could be sneaky and have one of her friends figure this out for you.  You could also take one of her rings and trace the inside circle or even, press the ring into a bar of soap for an impression.  When in doubt, go with a bigger size because it is easier to size down a ring than it is to make it bigger.

 

 

References:

http://gia4cs.gia.edu/EN-US/the-diamond-4-cs.htm?gclid=CMefrcGXqrcCFegWMgodUXcAyQ

http://www.smartmoney.com/spend/deal-of-the-day/7-tips-for-buying-a-bargain-engagement-ring-1341872908682/

http://www.artofmanliness.com/2009/07/01/the-ultimate-guide-to-buying-the-perfect-engagement-ring/

 

$3 Movie Tickets?!?!?!

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This episode, we welcome Robert Wagner to the podcast. He’s a portfolio manager and popular author for the ubiquitous investing website Seeking Alpha. I reached out to Robert after reading his article on flexible movie theater pricing.

How many times have you seen a movie a month or two after it opened, and find yourself in a totally empty theater? How many times have you looked around and thought, “how do these guys stay in business?”

Wagner’s article and our conversation, takes us through the economic concepts at play with a new company called DealFlicks. These guys have started a company that is aimed at getting theaters to offer flexible pricing for movie theater tickets.

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Wagner touches on several basic economic concepts – some of which we’ve talked about on the podcast before and some that are new. Have a listen and learn about this very real world example of the following; price floors and ceilings, surpluses, supply/demand, and Mitch’s personal favorite; UTILITY!!  Is there ever a time when paying $50 for a movie ticket is worth it? Listen or read Wagner’s article to find out!