A few weeks ago, I was interviewed by a Washington Post reporter about wedding loans. My feedback wasn’t included in the final piece, but the topic and the article got me thinking. If you’ve been following my blog for a while, you know that I got married last year. I spent over a year planning my wedding and thinking and writing a whole lot about it. I am aware of how expensive weddings can be and how stressful that is. But I also feel very strongly that going into debt for your wedding is not a good idea.
Most of the time, when couples go into debt for their weddings, they’re putting it on credit cards or taking out personal loans to cover the costs. More recently, though, companies are marketing what they are calling “wedding loans”. These loans are basically the same exact thing as a personal loan: an unsecured loan that you pay off over a period of time. Regardless of what you call it or how you do it, I don’t think you should go into debt for your wedding. Starting your married life with debt will not only leave you with potential financial stress, but it can prevent you from reaching other goals, like:
Going on a Honeymoon
After Dan and I got married, we spent nearly 3 weeks in Thailand on our honeymoon. The cost ended up being just shy of $5,000, including all flights, lodging, activities, food, and shopping. It was a once-in-a-lifetime experience that I’m so grateful that we could experience. We prioritized saving for our honeymoon while we were saving for our wedding so that we could leave right after we got married. If we’d had to worry about paying off wedding debt, we might have had to delay our trip or gone somewhere closer or less expensive.
Of course, if you’re saving up cash to pay for your wedding, it may be impossible to go on a honeymoon right away. If you do have to delay your honeymoon, at least you wouldn’t have to delay it for the entire time that you’re paying back your wedding debt.
Buying a Home
The average wedding in the United States costs upwards of $30,000. That could also be a 10% downpayment on a $300,000 house. If you’re spending the first couple years of marriage paying off your wedding, you may not be able to prioritize saving up for a down payment on a home. Many young people are already putting off buying a home because they have student loans to pay back. Adding another hefty debt to the equation could mean you are unable to buy a home for many more years than you’d planned.
Paying Off Other Debt
In the United States, 45 million people are currently paying back student loan debt. The average debt owed is just under $30,000, but many people, especially those who went to grad school, owe much more than that. It can be difficult to pay these loans off even if you don’t have any other debt. Plus, it’s not just student loan debt that affects people. Many Americans also own credit card debt. Credit card debt often comes with high interest rates and hefty fees, which can snowball into more debt than people ever anticipated. And if you add an expensive wedding loan on top of it, it could be hard (or even impossible) to prioritize paying it off.
Having a Happy Marriage
Marriage can be difficult no matter what. That’s what happens when you’re building a life with another person. That’s why it’s so important to start your marriage on good financial footing. It’s even more important because money trouble is one of the top reasons for marital discord and divorce. Adding more debt right when you’re entering your marriage is a potential recipe for disaster.
So, if you don’t want to go into debt for your wedding, what can you do instead?
Delay Your Wedding
If it’s going to take you more than a year or so to save up to pay for your wedding, it might make sense to delay it until you’ve had time to afford it out right. I know one person who got married to her husband and had a small, intimate celebration right away and then a big traditional wedding several months later. If you don’t want to wait to get married but you need to wait to have the party, that might be an alternative option for you! This gives you time to pay off debt or save up money or earn more income in order to make your circumstances easier.
Save The Cash
In my opinion, the best approach is to save up for your wedding and pay for it in cash. Of course, you’d need to do this over a longer period of time and potentially make other sacrifices in order to make it work. But it’s possible! You make this easier by automating a certain amount of savings every month or you can put any windfalls (like tax refunds, gifts, or bonuses) into an account designated for your wedding. Or, like Dan and I did, you can do both! Get clear on the amount that you want to save by when and map out how much you’d have to save every month to get there.
Change Your Plans
Trust me when I say that I completely understand the desire to throw an awesome party for your wedding. I did that for my own wedding, even though I had major reservations with the cost. Part of me actually wishes that I’d wanted to either elope or have a courthouse wedding so that we could have saved a ton of money for other things. I know people who spent just a couple thousand of dollars on a small wedding and they don’t seem to regret it at all.
If you know there’s no way you can have an expensive wedding without going into debt, it might be a good idea to explore your other options. You could have a court house ceremony followed by a dinner celebration, you could have a small pop up wedding, or you could do a destination wedding! There are lots of options out there now, and not everything will cost an arm and a leg.
So how about you? How did you pay for your wedding? Do you wish you’d done anything differently?
Certified Financial Education Instructor. Feminist and financial coach for women. Founder of Money Circle.