Wedding planning but want to make sure you take on debt wisely to finance the wedding?

Erika Giovanetti, Consumer Lending Analyst at U.S. News & World Report says “Ideally, consumers shouldn’t take on debt at all for nonessential costs like wedding expenses. Weddings are getting more expensive by the year and so many people do end up going into debt to pay for one. In fact, a U.S. News & World Report survey found that more than half of engaged couples were planning to take out debt to help pay for their wedding.”

If you do end up taking out a credit card debt, utilize promotions like 0% APR offers to reduce the total interest paid. Be mindful of any fees, like transaction fees charged by the vendors or annual fees charged by the credit card issuer.

Personal loans can be a smart alternative to credit cards when it comes to wedding financing, especially if you can get a low, fixed rate. Don’t be tempted to take out a loan with a long repayment term just to save money on the lower monthly payments. For example, you could end up paying thousands more in interest over time by taking out a five-year personal loan compared to a two- or three-year personal loan. Resist the temptation to overborrow. Borrowing only what you need ensures you aren’t paying interest on money you could’ve taken out of savings or borrowed from family at zero interest.

Alternatives to having a wedding

“If the thought of shelling out thousands of dollars on a one-day event makes you shudder, you simply don’t need to have a wedding ceremony and reception.

Giovanetti says:

My husband and I were married in a private courthouse ceremony. Some family members were disappointed in the moment, but I have no regrets about how we chose to spend (or save) our money. Instead of paying for a wedding that neither of us really wanted, we were able to use that money to put a down payment on a house and start our married life out on the right foot financially.

 

Today’s CPI report shows that while inflation is slowing, higher prices are here to stay. Inflationary pressures are felt across all different types of sectors across the economy, including the wedding industry. According to a recent U.S. News survey, 63% of engaged couples say their vendors have asked to raise prices – with inflation and labor shortages being the most common reasons. Other highlights include:

• 63% of engaged couples say their economic situation has gotten worse since they started making wedding plans, with 49% saying that inflation has increased their household’s living expenses.
• 47% of engaged Americans have had to reduce their wedding budget due to the current economic climate.

Just make sure you’re on the same page as your partner – throwing a big event may not be your ideal scenario, but it may be important for your partner to have their family and friends included.

For many couples, throwing a wedding is the first large financial commitment they’ve taken on together. It’s normal to have some disagreements about how the money is spent, but communicating clearly and being open to compromise will ensure you can overcome these obstacles without sacrificing your combined financial goals.

If you’re uncomfortable spending tens of thousands of dollars on a wedding, it’s okay to feel that way. Wedding expenses have shot up over the past two decades, and it’s gotten even worse in recent years thanks to inflation and labor shortages. But if you’ve always dreamed of having a picture-perfect wedding, it can be possible to do so without driving yourself into debt. Get realistic quotes from venues and vendors. Go smaller with your guest list, or host the wedding in a cheaper city. Take your time and save up during a long engagement. There are plenty of ways to make a wedding happen without betraying your wallet – but being thrifty often means more work on your end.