Business Insider reported in April 2018 that the average cost of an American wedding is $33,391. Author Sarah Jacobs also cautions that this figure doesn’t account for regional differences, adding that New York City nuptials price out at more than double that average, while New Mexico couples only drop about $17,500. Yet no matter where you live, money will significantly impact your wedding plans. With that said, you must decide on the best methods for funding your special day.
Determine Available Financial Resources
In modern times, more couples are either paying for their events by themselves or getting a little bit of help from their families. Journalist Vivian Marino recommends figuring out as early as possible how you’ll fund your celebration in a May 2018 New York Times piece. It’s essential to know your money sources, set an event budget, and craft a savings strategy near the beginning of your planning process.
Saving Up for Your Nuptials
If you’re able to save up money for wedding expenses, you have two key decisions to make. First, you must create a savings scheme with your timeline and goals in mind. The Motley Fool stresses that you’ll need several pieces of information to construct your plan:
- Total estimated wedding costs
- Available funding from other sources
- The time length of your engagement
With the average engagement period at 14 months, our hypothetical New Mexico couple planning a $17,500 wedding and receiving $8,000 in family contributions will need to raise $9,500 on their own. Over that 14-month period, they must save around $680 per month to reach their goals.
Second, select a savings vehicle that will return the best results and with an appropriate amount of investment risk. In Vivian Marino’s New York Times piece, financial planner Barbara O’Neill suggested that couples avoid aggressive methods such as stocks. Choose certificates of deposit, which offer better interest rates than savings or money market accounts and will prevent impulsive spending.
Funding Your Wedding With Credit
According to CNBC’s Helen Zhao, 44 percent of couples surveyed in a Student Loan Hero poll revealed that they intended to borrow $10,000 or more for their weddings. At the same time, multiple experts warn against going into debt to finance your nuptials. In an August 2018 Martha Stewart Weddings article, Jen Sinrich details several risks of going into debt for your wedding.
- Extended payoff timelines
- Paying back more thanks to high interest rates
- Worsening existing financial burdens, especially with student loan debts
- Negative effects on your credit score
- Added stress that could impact your marital relationship
If you must use credit to pay for wedding costs, NerdWallet’s Lindsay Konko offers a few suggestions. As you mull over your options, weigh both the pros and cons of using credit cards or loans and consider factors such as interest rates, annual fees, your existing debt loads, and perks such as rewards points or cash back bonuses.
Consider Cost-Cutting Strategies
A frugal approach can put your wedding dreams within closer reach. Common cost-cutting moves include shrinking the size of your guest list, holding your event during an off-peak day or time, picking seasonal flowers or greenery, and limiting your alcohol choices. Meanwhile, The Knot’s Meredith Bodgas lists several additional recommendations to help pare down your expenses.
Funding your wedding is no easy feat, but you can put several strategies to good use. While most experts urge couples not to rake up debt to say “I do,” it’s important to perform a cost-benefit analysis if you intend to use credit to pay for some expenses. Determining your funding sources early, crafting a savings plan, and examining ways to reduce costs are wise steps for bringing your wedding vision to life.
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