October 26, 2016

It’s Wedding Season. But, Can You Afford to Say “I Do”?

The weather is getting warmer and flowers are blooming. We all know what that means — it’s wedding season!

Weddings have become a $50 billion industry in America.  As of this year, the average cost of a wedding is about $27,000 per couple. To make matters more complicated, the majority of weddings are paid by the couple themselves. Long gone is the tradition of the bride’s parents paying for the wedding and the groom’s paying for the rehearsal dinner and honeymoon.

Part of this is due to the fact that the average age of a bride today is now 27 to 29 and they have been living on their own for almost a decade or more. Beyond that, women now have the ability to support themselves and they are not a considered drain to the family finances. Furthermore, many parents are paying for undergraduate and graduate school education for their children. So, by the time a wedding rolls around, parents have to start considering funding their own retirements.

So, if you are part of the 70% of brides- or grooms-to-be that have to contribute in some way to their wedding, there are some things you need to consider before finalizing your wedding list.

To begin, you must consider what your life will look after your wedding. This means considering if you plan on renting or buying. How much of a down payment do you have? What do your savings consist of? Lastly, does anyone involved in the wedding need to take out a loan to pay for your big special day?

Before I discuss each of these points,  I want to share a story with you. My friend goes to work each day with a very kind man who is 64-years-old. He was eligible to retire 5 years ago at the young age of 59, but his daughter got engaged and he promised to give her a perfect day. So, he continued working to save for and take loans out for this wonderful day.

Two years later, he walked his beautiful daughter down the aisle. As a wedding gift, he helped buy their first home. Two heart attacks and two years later, his daughter moved out of the wedding gift and back home. Then came the divorce.

One year later, after a third heart attack, my friend asked, “Why are you still here putting up with the stress?” The answer was simple: because he owes two more years on the perfect wedding — that will have been over for three years by the time its paid for.

Sadly, this isn’t the only story I know.

The reality is that 43% of marriages end in divorce. If you are getting married this summer, you need to have this conversation. If your parents or future in-laws are offering to provide money, you need to ask yourself — can they really afford it?

The first — and most important — conversation to have is what can you, your partner, and families afford. Has money been saved? If anyone brings up a loan, the correct decision would be — NO! No wedding is worth putting your families future in jeopardy.

The next conversation that needs to take place is — do you have money to buy your home/asset? If you don’t have money to buy your first asset, then you don’t have the money to buy a one-day expense.

Next, are you in a position to support a family if one have one? Children come before you plan for them sometimes, so you need to make sure you are prepared for a “mistake” if it happens.

Finally, who is coming and how will you cut the list? For me,  it was simple. In the area where we live, the average wedding dinner runs at about $100 per person. This didn’t include the location, the flowers on the table, the tablecloths, plates, cake, chairs, musicians, invitations, and “Thank You” cards. I have never in my life eaten a dinner that cost me a $100 just for me — not to mention the extras that make the meal closer to $200 a person. If I am not willing to spend $100 on myself, I am not willing to spend it on people I barely know.

To be honest with you, we didn’t have the money to buy our first home, have a wedding, and accumulate an adequate emergency fund. It wasn’t the most popular decision I ever made. However, I will tell you that when my husband and I planned our ten-person wedding (which included us and our priest) — it was the best decision I ever made. I may not have had a dance party, open bar, and 300 of my closest family and friends, but I had the money to save my dog when she got lymphoma and I was able to buy my dream home with my husband.

I may not have gotten the traditional princess day, but I did get the princess life.

Anna Domzalski is a staff writer for Financial Bin covering Budgeting, Wealth, Education, and Real Estate.

Have a question for Anna? Email her at Anna@FinancialBin.com.

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