An in-depth guide to buying diamond jewelry for absolute beginners

If you’re going to spend more than the cost of a fancy dinner on a piece of diamond jewelry, it pays to know how to be a smart shopper. For most people, buying a diamond, whether a loose stone or as part of a jewelry, is an important decision – especially if it’s going to be a gift for someone special.

Buying a diamond is also more than just an investment. Whether it’s an engagement ring to start a new life with someone special or a pair of earrings that celebrate twenty-five years together, a diamond is often something special. And even if you don’t understand what makes a good diamond, there’s a good chance the person you’re giving the diamond to will know. So, the burden is on you to make sure that you find the best-quality diamond for the money you’re paying.

The good news is that you have help. This compact guide will help ensure that you find the highest quality diamond jewelry at the right price, without wasting money. And it all starts before you step foot in a jewelry store or visit a jewelry website.

Key preparation steps

The #1 way to make sure you don’t lose any money in your search for the right diamond is to invest a little time in the preparation stage. Specifically, you need to decide how much you will spend and what you want to purchase – or better yet what the person receiving this gift really wants.

Know what you want

Whether you’re buying a ring, necklace, earrings or pendant, take the time to find out what style your gift recipient wants. You could ask that person directly, and that’s definitely the preferred option for wedding and engagement rings.

If you want the gift to be a surprise, then you’ll need to work on some intelligence gathering. Start by paying attention to the jewelry your recipient likes to wear. But don’t forget that you can also ask your recipient’s friends or family members for ideas.

Determine how much you want to spend

You can literally find a diamond for any budget. But to make sure you don’t go broke from your purchase, you need to establish a budget before you start shopping. A good working budget normally includes a minimum and maximum range, and that maximum amount is something you feel comfortable spending.

With engagement rings, the rule of thumb in recent decades has been two months of salary. But the smart shopper ignores that rule of thumb. For starters, that guideline comes from a 1980s advertising slogan by luxury jewelry giant DeBeers – who wanted to get customers to buy more diamonds. In other words, ignore that advertising slogan.

The reality is that your budget is based on how much you can afford to pay. Even if you plan to just charge it to your credit card, you must remember that you have to pay back that debt. If you plan to finance your purchase, start by calculating how much you can pay each month. Then multiply that monthly amount by six months, to estimate the total price you should pay.

The Four Cs

Now that you’re ready to start shopping for a diamond, the basic guideline for buyers are the “Four Cs”: color, cut, clarity and carat. These four Cs help determine the value of a diamond.

Color

There are two elements to color: the yellow hue, if any, in the stone; and the florescence. Diamond stones typically fall in a color range between light yellow and colorless – and the more colorless the diamond, the higher its value.

To simplify how the color of diamond stones are graded, the Gemological Institute of America (GIA) developed a 23-letter grading scale that went from D to Z, with D being the most colorless and Z having very noticeable coloring. [The GIA scale omitted A, B and C, because the previous rating popularly used in the past used an A-to-C grading scale.]

The following is a detailed overview of the GIA standard color measuring system for diamonds:

  • D – Absolutely colorless. The top of the scale starts with diamonds that are have no coloring whatsoever.
  • E to F – Colorless. Diamonds graded E and F are also considered colorless, but also offer the highest value. Purists tend to look for diamonds with a minimum rating of F.
  • G to J – Near colorless. Diamonds in this range have almost unnoticeable color. In fact, to the naked eye, even J-rated diamond stones normally appear colorless. The best value for quality diamonds often come with diamonds in the near-colorless range.
  • K to M – Faint yellow. In this range, the diamond typically has a barely or slightly noticeable yellow hue.
  • N to R – Very light yellow. These diamonds have an obvious but still relatively light-yellow coloring.
  • S to Z – Light yellow. The lowest-rated diamonds, in terms of color, tend to have a more pronounced light-yellow coloring.

In addition to the yellow hue (or absence thereof) in the diamond, color also involves florescence. Under florescent lights or with direct sunlight, some diamonds seem to change color. This florescence can sometimes make diamonds rated K to Z appear colorless or slightly blue, which often increases the value of a yellowish diamond.

Unfortunately, sometimes a diamond has a yellow florescence which can have the adverse effect of lowering the value of diamonds in the D to J range.

So, as you examine diamond stones for color, remember to check its GIA color rating and examine its florescence under florescent lights, whenever possible.

Cut

While florescence may seem to add color to a diamond, florescence is not the same as the diamond’s brilliance, also called its brightness or sparkle. That brilliance is the result of how the diamond collects and distributes light, and the biggest factor in that regard is the diamond’s cut.

In fact, the right cut can help increase the value of a diamond by almost half, compared to other diamonds with weaker cuts. Unfortunately, cutting diamonds to superior standards will mean chipping away and wasting up to 50% of the original stone. That’s why many jewelers and cutters sometimes opt for inferior cuts that retain more carats.

Regarding the four Cs, the cut doesn’t refer to the diamond’s general shape. Yes, some shapes are sometimes referred to as cuts (e.g. round, square, rectangular, oval or pear shapes). But strictly speaking, cut refers to the diamond’s proportions, symmetry, depth and polish. More specifically, the “cut” in the context of the Four Cs refers to precision cutting of the stone to produce facets (typically around 58 with many quality diamonds) that help the finished diamond reflect more light.

The cut is critical to how the diamond will gather and distribute light. In other words, the determines how the diamond will shine and sparkle. A well-cut diamond captures more of the available light and reflect more light upwards.

  • Not too flat. When the diamond is cut too shallow, it tends to lose a large amount of collected light down through its bottom points.
  • Not too deep. On the other hand, deeply cut diamonds will also lose a large amount of its collected light through its steep sides. Deep cuts cause diamonds to seem darker.
  • Ideal or excellent cut. The superior diamond cut is neither too shallow or too deep. Well-cut diamonds will bring in light from the “pavilion” (top of the finished stone) bounce light off once side then across to the other side, before coming out the top.

There are mathematical equations that experts use to grade cuts. However, the American Gem Society (AGS) and the Gemalogical Institute of America (GIA) both have their own rating systems.

  • The GIA has a 5-level system: Excellent; Very Good; Good; Fair; and Poor.
  • The AGS has a 6-level system that adds an ideal rating to the top: Ideal; Excellent; Very Good; Good; Fair; and Poor.

In general, the highest quality diamonds are cut to ideal or excellent.

Clarity

The diamond’s clarity is a measure of the stone’s purity and lack of blemishes. These impurities interfere with the diamond’s dazzle and can increase the probability that the diamond becomes damaged or cracks. Consequently, clarity has a significant effect on a diamond’s quality and value.

But as with other gemstones, most natural diamonds have imperfections, blemishes on the diamond’s surface and inclusions inside the diamond. In fact, very few jewelers have ever seen a diamond absolutely devoid of any inclusions or blemishes. At the same time, many inclusions and imperfections are invisible to the naked eye and often require a strong magnifying glass.

When grading a diamond’s clarity, expert jewelers consider several factors about the stone’s inclusions, such as the size, number, location and visibility of inclusions, as well as whether they might impact the diamond’s durability. The GIA rating scale for clarity used by jewelers today uses consists of 11 general levels, based on those five factors:

  • Flawless (F1) – The highest rating level indicates that under 10X magnification, no internal or external blemishes have been detected. Of course, there may still be flaws that are only visible with greater magnification.
  • Internally Flawless (F2) – The second highest rating level indicates that under 10X magnification, no internal inclusions have been detected — although some external blemishes are allowed, as long as they’re minor and only on the surface.
  • Very Very Slightly Included (VVS1/VVS2) – Inclusions have been detected under 10x magnification, but they are so minute that they are difficult to spot even with magnification and almost unnoticeable to the naked eye.
  • Very Slightly Included (VS1/VS2) – Again, only minor inclusions have been detected with magnification, though may be difficult to spot with naked eye.
  • Slightly Included (SI1/SI2) – At this level, 10x magnification can easily spot internal blemishes. And some blemishes may even be visible with the naked eye.
  • Included (I1/I2/I3) – The lowest clarity rating is for stones in which inclusions and blemishes are usually visible to the eye.

 

Carat

Contrary to popular misconception, carat doesn’t refer to diamond size. Strictly speaking carat refers to the diamond’s weight. Of course, carat weight does increase with the diamond’s size but diamonds can also look bigger because of the way they’re cut.

One carat is 0.2 gram or about 0.007 ounces. Jewelers measure down to 1/100th of a carat, and each 1/100 carat is sometimes called a point – so that a 100-point diamond is a 1-carat diamond.

It’s important to note that price doesn’t follow a straight line with carat weight, because there are other factors (especially the other Cs) that matter. For example, two diamonds with exact same carat weight may have wildly differing prices, based on the clarity, cut and color of the diamonds.

Another thing to remember is that carat weight can only really be measured when the diamond is loose. Lastly, you’ll sometimes hear about “total carat weight.” That term refers to rings, pendants and other jewelry that have set more than one diamond stone. Thus, total carat weight refers to the estimated combined weight of the diamonds in that jewelry.

Comparison shopping

The four Cs provide a handy guide for comparing different diamonds as you shot. Depending on your budget, you may not hit the top ratings on cut, color and clarity. Or you may have to settle for a smaller carat diamond. Regardless, make sure you obtain the GIA or AGS ratings as you start to compare diamond stones and jewelry.