Congratulations! You’ve found the person you want to marry.
But planning a proposal and then a wedding can create a lot of financial pressure. Plus, you and your soon-to-be spouse need to make sound decisions together about both your wedding costs and your general finances.
Although money stress can be a major issue when you get married, it shouldn’t rule your decisions or keep you from proposing if you feel ready for it. Here are five important money steps to take leading up to your proposal, engagement, and marriage.
1. Choose an affordable engagement ring
One of the biggest initial costs of getting engaged is, of course, the engagement ring. Budgets for this important piece of bling can range from hundreds to thousands of dollars or more.
In fact, the average cost of an engagement ring is $6,163, according to The Knot. But with some creativity and the following tips, you can avoid overspending on a ring.
Set a reasonable budget
Common wisdom suggests spending a month’s worth of income on an engagement ring, but only you know what’s affordable for you.
Michael Galvis, an editor for Student Loan Hero, decided cheaper was better for him and his significant other. “We were still early in our careers, and saving money was a bigger priority,” he explained.
Pay for the ring in cash
If you avoid financing your ring purchase, you also can avoid added interest costs. If you don’t have enough saved, plan ahead so you have time to start an engagement ring fund.
Understand your partner’s expectations
Ben Luthi, a writer at Student Loan Hero, said he regrets opting for a more expensive $2,800 ring. “I wish I had listened to my wife,” he explained. “She really didn’t care about that stuff, but I wanted to ‘prove’ my love, so I spent far more than she wanted to.”
Skip the diamond
A less expensive gem can be just as beautiful as a diamond. Or your soon-to-be fiance might prefer a band without any stones.
For instance, moissanite is a gem that looks like a diamond but is much cheaper. Here’s a price comparison:
- I-color, VS2 1.0-carat diamond: $4,000
- Colorless 1.0-carat moissanite stone: $600
Heck, even if you opt for cubic zirconia, most people will assume it’s a diamond anyway.
Consider secondhand rings
Family heirlooms can make meaningful engagement rings. You might uncover a treasure at an antique store, on eBay, or at a pawn shop.
Insure the ring
Ring loss, theft, or damage might be covered under a warranty or other insurance policy. When I lost my engagement ring, for example, I put in a claim with my renters’ insurance and received funds to replace it.
2. Plan and budget for your proposal accordingly
Besides the ring, the other thing you might need to spend money on immediately is the proposal itself.
This is another topic you might want to either directly or subtly discuss with your significant other. Try to collect clues from your partner or mutual friends as to whether your partner would prefer you going all out for your proposal or keeping it simple — or doing something in between.
Since I’m not much of a romantic, I made it clear while dating my husband that I would find a grand-gesture proposal to be sappy, unnecessary, and potentially embarrassing. He kept it simple, getting down on one knee during a hike I had planned for the two of us. It made me feel valued and understood.
Even if you choose to spend more money on a proposal, keep it reasonable. You can achieve a fantastic proposal for about the cost of a fancy date night; there’s no need to plan a pricey vacation or rent a blimp. Focus on a proposal that will be meaningful and well-suited to your partner’s personality and taste. That thought will count far more than the cost.
3. Clear the lines of communication about money
You’re planning to join lives with your significant other, and a big part of that process is learning how to navigate your finances together.
Hopefully, you and your partner are transparent and open about your financial situations. Maybe you’ve already discussed combining your finances if you live together — or at least have a system to jointly cover expenses.
Galvis and his husband often discussed marriage and finances before their engagement. Luthi said he and his wife also discussed how they wanted to manage their money together before they got married.
I, on the other hand, had more haphazard discussions with my husband about our finances before marriage — and it worked against us. For instance, I had no idea how much money he had saved, and he had no idea how bad my credit was.
If you haven’t already, start discussing your personal finances regularly. That way, you can develop a pattern of talking about your money in a calm and productive way and prevent miscommunication.
You also should practice planning, managing money, and setting financial goals together. Plus, it’ll be a chance to get to know each other better and build mutual trust around the topic of money.
4. Discuss all aspects of your financial situations
As you discuss your financial situations leading up to your marriage, be thorough and comprehensive. That way, you’ll both have the details and context you need to make informed money decisions.
Here are a few topics you should discuss with your partner.
General attitudes about money
Open up about your financial backgrounds and identify common ground to build upon. Don’t hesitate to praise each other for financial strengths or identify weakness you can work on.
You should know what you owe, to whom, and why — and so should your partner. You also can discuss whether you’ll share responsibility for repaying debts that predate your marriage.
I had no credit when I got married, and it mattered more than I thought it would. For example, my lack of credit was a black mark against us on rental applications. Our first landlord took one look at my credit score and suggested I be left off the lease altogether. We got the apartment thanks to my husband’s sterling credit.
Make sure you understand your credit scores and how they could impact financial moves you hope to make together, such as renting an apartment, getting a loan for a car, or buying a home.
Budgeting and spending approaches
Discuss how you budget your money and make spending decisions. Try to understand your partner’s approach and make sure they understand yours. Start discussing how getting married might affect your approach to budgeting as a couple.
Mixing your money
Your engagement is a prime time to revisit the topic of how you share or separate your finances. For instance, my husband and I see all the money coming into our household as shared funds we manage together — and we have since day one.
On the other hand, Galvis said he and his husband “decided that keeping our finances separate worked best for us.”
“We only pool our money for shared responsibilities like paying bills or saving up to buy a house,” he explained.
Tallying up income, savings, and assets
Be open about the money and shared resources you have at your disposal as a couple.
For instance, each partner should share how much they earn, what they have saved up in the bank, investment accounts, and retirement accounts. Reviewing this information can help you understand your significant other’s money habits and net worth.
Ultimately, you both need to understand how much money you have access to so you can make informed financial decisions together.
5. Plan out your finances beyond the proposal and wedding date
Remember: Your wedding is the starting line, not the destination.
Take the time to plan for long-term money goals, such as saving for retirement or buying a home together. And make sure you both understand how getting married can affect your student loan options, your asset ownership, your income taxes, and other aspects of your personal finances.
Lastly, keep your wedding in perspective. While it hopefully will be one of the happiest days of your life, it’s just one day. If you keep your engagement and wedding affordable and limit debt, you’ll create a strong financial foundation together.
This post was part of a paid partnership.