Wealth Matters: The Secret to Buying the Perfect Diamond

Tom Taira, a co-founder of the auto website TrueCar, was in the market for a new diamond for his wife, Stephanie. He wanted to replace the one he had given her for their engagement 10 years earlier with the diamond and setting that he wished he could have afforded then.

But finding a 2.8-carat emerald-cut diamond that would fit the new setting was not easy, and he certainly did not want to overpay. The price would be $35,000 for just the stone.

Mr. Taira is not alone in his search. This is a popular time of year to buy a diamond for a holiday gift or an engagement ring. But the gemstone has become increasingly expensive.

Demand for diamond jewelry throughout the world hit $82 billion in 2017, a record for the industry, according to the Diamond Producers Association, a trade group. Since 2005, when diamond production peaked, the number of diamonds being mined has been shrinking, which has allowed sellers to raise prices.

“We basically found every diamond we could geologically,” said J. Grant Mobley, a diamond expert and trade lead for the Diamond Producers Association. “There are no new deposits, so prices are going to go up. But demand is going up, since China and India are becoming much more important to diamond jewelry.”

But what’s good for the diamond industry can produce anxiety for the consumer. And the gems are always a tough purchase because most people buy a diamond only a few times in their lives, if not just once.

Ryan Fennerty, an enterprise account director at General Assembly, the coding boot

Keep reading this article on The New York Times Your Money.