Beyond the Sparkle: A Guide to Buying and Collecting Luxury Jewelry and Watches

If you’re considering jewelry and watches as a potential investment asset, expert guidance can be incredibly valuable. Auction houses, dealers, and independent specialists can provide context on what is truly exceptional, what could have long-term staying power, the current market demand, and what may be more difficult to resell. The secondary market can offer access to rare or discontinued pieces, but it requires the highest degree of diligence. It’s crucial to understand the terms of sale and have an independent specialist confirm authenticity, assess condition, and gauge appropriate pricing.

What factors make jewelry and watches collectible investment assets?

Pieces from heritage jewelry maisons may attract collector interest, as can signature, limited-edition watches from established brands.

But brand name alone is not enough.

"Whether jewelry or a watch is considered an investment asset must be determined on a piece-by-piece basis. Clients are sometimes surprised when a very expensive piece from a prestigious brand is not considered an investment-grade collectible asset," says Heslington.

Heslington shares five considerations that, taken together, could help determine whether a piece has potential long-term investment value.

1. Rarity—Is this item one-of-a-kind or part of a very limited series?
2. Historical significance—Does it have a meaningful story or provenance?
3. Craftsmanship—Is the design or execution exceptional?
4. Condition—Is it well-preserved and does it have its original key components?
5. Authenticity—Is there reliable documentation, such as GIA certificates, certificates of origin, or original invoices, and has it been personally handled and examined by an independent specialist?

Most importantly, if the price point is significant for you, an independent specialist should vet the transaction and diligence each of these factors.

Wealth planning considerations for jewelry and watches

Whether you own a single meaningful piece or a larger collection, there are several important wealth planning considerations to think about.

• Documentation and inventory: Whether buying directly from a brand, authorized retailer, or auction house, preserve all original paperwork. This documentation can be essential for authentication, future resale, and tracking tax basis. An organized, updated inventory helps keep track of what you own and greatly facilitates the process of future appraisals that may be required for insurance, estate tax, or other purposes.
• Insurance: Understand the coverage and limitations of your insurance policy. A standard homeowner’s policy, for example, may not cover the full value of your pieces, depending on the circumstances of the loss or damage. A rider or specialized policy for jewelry and timepieces is often required if you want complete coverage, especially when pieces are being worn while traveling internationally. Review your policy and needs with a qualified insurance specialist.  
• Appraisals: Values can change over time, so appraisals should be kept current, especially if you want to maintain adequate insurance coverage. Appraisals are also often the first step toward an effective legacy plan, as knowing the current market value of your collection can allow for more accurate tax and liquidity calculations when assessing different planning strategies. 
• Storage and care: Proper storage, regular maintenance, and thoughtful handling can help protect your piece’s condition and value. For watches, make sure that key external parts are not replaced during servicing without your consent, as this could greatly diminish value in certain situations; for jewelry, pieces should be stored in individual pouches in compartmentalized boxes to prevent stones from scratching each other. Consider consulting specialists for guidance on how to care for your particular pieces.
• Estate planning and succession: Jewelry and watches often carry emotional and sentimental value for family members. Ask family members if they’re interested in any particular pieces to figure out how to manage collections and minimize future conflicts if multiple people want an item. For pieces that will be sold, identify who will manage the sale and what support they may need. If they’re not familiar with jewelry or watch markets, provide clear guidance on which specialists to connect with to help facilitate the sales process and support informed decision-making.    
• Tax considerations: When acquiring jewelry and watches, be aware of potential sales and use, VAT, and import taxes. If high-value jewelry and watches are in a foreign jurisdiction, work with a tax specialist to determine whether these items could potentially be subject to estate tax based on their ownership structure. Tax treatment depends on individual circumstances, and clients should consult their tax advisor regarding tax consequences associated with sales, gifts, collectibles, estates, and cross-border ownership.

Beyond jewelry and watches

Many of these acquisition and wealth planning considerations extend beyond jewelry and watches to other passion assets, such as art, handbags, wine, classic cars, and other collectibles. Whether you are acquiring a rare Hermès bag, a Picasso, or an F.P. Journe, an informed buyer is likely to raise similar questions related to quality, authenticity, condition, and investment potential.

Jewelry and watches can carry emotional, aesthetic, historical, and financial significance. They can tell personal stories and connect generations. And like any asset, they deserve careful wealth planning. For clients who already own these assets or are considering building a collection, the most important step is to treat them intentionally. That means understanding what you own, documenting it properly, protecting it, and seeking specialist advice where appropriate.