After getting engaged, couples will eventually come down from the heights of happiness by asking for marriage. Then they’ll have to face an important reality: an honest conversation about their wedding budget. While this might sound unpleasant to some, finding out the details of who’s paying for your wedding (and how) doesn’t have to be uncomfortable.
In fact, if you enter the planning stage with your partner on the same page, it will not only make the often overwhelming process easier, but will help set you up for success in the long run. It doesn’t matter if you’re footing the entire wedding bill or just paying a small portion of the bill; it’s essential to figure out exactly how you’re going to pay before jumping into guest lists and venue availability.
Keep in mind that paying for a wedding looks different for every couple and there’s no right or wrong way to do it, says wealth management advisor Maria Roloff. Below, she shares her opinion and tips for tackling wedding finances.
How to get started
Some couples may have family members contribute a certain amount or offer to pay for part of the wedding, such as the rehearsal dinner, while other couples may be responsible for paying for everything themselves. The most important part of calculating wedding finances is to start the conversation early.
“Whether you’re sharing costs with your partner or getting support from family members, it’s essential to have the money discussion right away,” says Roloff. “You’ll want to know how much money you need to have set aside and what your savings strategies will be before you start planning and reserving items for your big day.”
If you think a family member will help or contribute to your wedding as a gift, you have two options:
Get clarity ahead of time or make arrangements that don’t depend on those funds. Making plans based on uncertain finances or an amount of money you’re not entirely sure of only leads to more stress and embarrassment later.
If you don’t feel comfortable having the “money talk” ahead of time, then plan as if you don’t have it, and any gift you are given will be a much sweeter bonus than the uncertain clutch your wedding depended entirely on.
Wedding payment options
Having the conversation ahead of time can give you the opportunity and time to budget, get clarity where it’s needed, and start saving ahead. Payment options for your wedding include:
Personal savings
Credit cards, keeping in mind the high interest rates that can lead to additional debt
Wedding loans, which are also subject to interest and repayment terms
Your pension account, but you may be subject to early withdrawal penalties
Loan or gift from a family member
A combination of the above
“If money is tight and dipping into savings isn’t an option, you may consider taking out a wedding loan,” explains Roloff. “However, I recommend looking at other options first because of the potential for high interest rates and additional debt.” That’s because the decisions you make about taking on debt to pay for the wedding can negatively impact your credit score and your ability to buy larger purchases, such as a home, after the festivities are over.
Tips for wedding budgeting and money management
Planning a wedding can seem overwhelming, but a financial advisor can be a valuable resource with long-term effects. “An advisor can help you and your partner assess your entire financial plan and develop a strategy to accommodate your wedding wants and needs without breaking the bank or straying too far from any long-term financial goals,” explains Roloff. “Then you can focus on what’s important – enjoying your celebration.” In addition to talking to a financial advisor early in the process, she also recommends the following tips for newly engaged couples:
Be realistic from the start.
“I recommend having an honest conversation to establish a realistic wedding budget from the beginning, keeping in mind your and your partner’s monthly budgets as well as short- and long-term financial goals.”
Start with the venue.
Although every couple’s priorities are different, “a good rule of thumb is to allocate about 50% of your budget to the venue and catering,” says Roloff. “This will likely be the biggest cost, and limiting spending to this benchmark can help you avoid overshadowing other areas of your budget.”
Experts explain the average cost of wedding venues in the U.S.
Use a budget calculator.
An online budget calculator can help you keep your expenses organized by breaking down obvious wedding costs, such as dress and venue. But it can also help you call out the ones you may not have thought of, like the cake cutting fee.
Look at the big picture.
As you start to put the details together, take a look at the extras you could possibly give up. “Consider cutting back on centerpieces or the value of wedding party gifts,” says Roloff. Making small adjustments and stepping back every now and then to cut back, instead of getting carried away, will pay off.
