Understanding the value of a dollar is a valuable skill. When you look at the world around you, you want to break everything down into cost effectiveness. From food to clothing to services, everything has value and realizing that value can help justify or avoid making a purchase. There are some big purchases, like college education, that you may not have given any thought to yet, but another one is weddings.
When you go to enough of them, you begin to think about the financial breakdown and wonder why they cost so much.
The Cost of a Wedding
According to www.costofwedding.com, as of 2017 the average cost of a wedding is north of $30,000. About half of ithat is taken up by the reception, while the ceremony itself, along with photography, flowers, and the outfits make up much of the rest. Then there are other costs like engagement parties and the wedding rings.
It shouldn’t be too much of a surprise that the ages of those getting married factor into cost and who pays for what. A couple in their 20s will likely spend less than a couple in their 30s, but this may not be the case if the couples follow the tradition of the bride’s parents covering the costs.
In this case, the age of the couple wouldn’t matter, only how much money the parents of the bride have. Though the couple in their 30s are more likely to pay for it on their own, or only ask the parents for a contribution.
But why does it have to be this way? If the groom’s family has more money, why not get rid of tradition and do the more practical thing? Likewise, if one person has a larger family than the other, shouldn’t that be a factor?
So How Should a Wedding Be Paid For?
One article I read, by a writer named Ramit Sethi, suggests saving for your wedding based on the average age around which we are likely to get married. In the US, people tend to get married in the mid or late 20s. That means that putting away $300 into an interest-bearing account every month starting at 21 could cover much of the cost. The earlier the couple starts, the smaller the contributions need to be. This is a practical idea, but it’s unlikely that people will start saving before they get engaged.
Another idea I’ve seen brought up is to finance the wedding with a loan from a bank, or perhaps a home equity loan. As a financial planner, I wouldn’t recommend it. For both parents and newlyweds, risking or delaying retirement just to pay for a wedding doesn’t sound like a great idea. You have too many other potentially big expenses, like a home or a kid’s college education, to pay for. You shouldn’t put your own financial security at risk to make your wedding happen.
I know every family has different ideas about wedding costs, which means the two families should meet and have a discussion about what it should cost and any other related issues. It may be most beneficial for both sides of the family to split the costs, with everyone involved contributing something. The guest list could potentially be a factor as well, with the side that has fewer guests contributing a smaller amount for the reception.
It helps to put these issues out there right from the start. Remember, this is a person you are going to be spending the rest of your life with, so you want to make sure that registers with both of you. If so, then the financial issues will be easy to overcome.
If you have any questions, or would like to share your personal experiences with wedding expenses, feel free to contact me today.
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.