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Is Your Wedding Your Top Financial Goal?

Key Points
  • As wedding traditions continue to evolve, the average cost for an American wedding continues to rise.

  • As you make plans, start with your values and your financial goals as a couple, and evaluate the cost as you would any other large investment.

  • By setting priorities and creating a realistic plan of action, you can have a wedding that reflects your personal style and doesn't leave you with wedding-cost remorse down the road.

Dear Readers,

While there's a lot of talk about how Millennials are creating their own wedding traditions from cotton candy bouquets to movie-themed ceremonies, there's one thing that seems to be a constant—the high cost. According to The Knot 2018 Real Weddings Study, the national average for a wedding (without the honeymoon) is now $33,931. (That's more than double what it's estimated to have cost in 1990.) Granted, costs can vary dramatically across the country, and these numbers may be a bit skewed because of a small number of extraordinarily expensive weddings, but unless a couple chooses to elope—and apparently elopement ceremonies are on the rise—somebody has to pick up today's very significant tab.

Traditionally, the bride's parents would foot most of the bill, but that tradition is also changing as couples wait longer to get married and take charge of the planning as well as the payment. So before a couple deals with the everyday financials of married life, they can be faced with the enormous financial challenge of covering the wedding itself.

Of course, as somewhat of a romantic myself, I understand completely the desire to make your wedding day a lasting, lovely memory. But I'm also a financial planner and can't help but look at the "what and why" of making this type of large investment. So bear with me as I bring up some practical issues to help you put your wedding plans in perspective.

A question of values

Before we get into the money aspect, I'd first suggest thinking about what's really important to you. There's often a lot of social pressure to have a certain type of wedding. From bachelor and bachelorette weekends to having a large wedding party and a lavish reception, there's a certain tendency for wedding one-upmanship. But it's your celebration and should reflect who you are. Even if you can afford the equivalent of a royal wedding, maybe that's not for you. Don't be coerced by social or even family expectations into an event that doesn't express your own values. There's no right way to get married, only your way. And that doesn't necessarily depend on your budget.

Goals, goals and more goals

To me, any financial decision should be based on your goals. Is that unromantic? Absolutely not! Goals are rooted in the dreams you have for your life together. So what do those look like? Do you want to buy a house? Travel? Start a family? Retire early? If you haven't started to save for any of your other goals, you'll want to look at how spending a large amount on your wedding will impact your ability to put money toward these other important desires. 

Which takes you to the need to prioritize. If your wedding is number 1 on your list, that's fine. But if, for instance, the down payment on a house is in a higher position, it could influence the wedding-spending decisions you make. By prioritizing now, you may save yourself some regrets down the road.

And let me say a word about parents paying for the wedding. As tempting as it might be to dip into retirement funds to help out, don't do it. Your own retirement has to come first. And your kids will appreciate your independence later even more than your contribution now.

What you might need to save—and for how long

If a big wedding is a top priority, you'd be wise to treat it as a concrete savings goal as soon as possible—even before you have concrete marriage plans. Give yourself a fixed amount and a timetable. Let's say you expect to marry in five years and want to save at least $20,000 in advance. If you could put $325 a month in a savings account earning 2 percent, you'd hit your goal. Is that doable? For a realistic idea of what you'd need to save in advance and for how long, run some numbers on a savings calculator.

The long-term cost of going into debt

According to a recent Student Loan Hero survey, 74 percent of couples plan to take on debt to pay for their wedding, with 61 percent using credit cards. To me, this is the scary part. Let's say instead of saving that $20,000 from the example above, you put that amount on credit cards at 14.5 percent interest. Even if you paid $325 a month, it would take 9 years and 6 months to pay it off and cost $16,827 in interest. Looking at a cost-of-debt calculator before you pull out the plastic might help you think about what's really important for your special day.

A few thoughts on the cost for others

Weddings can be big-ticket items for everyone involved, especially when guests are expected to pay for travel and lodging as well as gifts. A friend's niece who had several of her friends get married within a couple of years was shelling out a fortune in travel for pre-parties, bridesmaid dresses and destination weddings. I'm not saying your wedding isn't worth the cost, I'm just suggesting that some of today's expectations can impact other people's budgets as well. I think it's important to factor that into your plans.

The happily-ever-after view

In the financial world we often talk about the importance of taking a long-term view. When it comes to weddings, I like the idea of taking the "happily-ever-after view." To me, that means celebrating your marriage with a wedding that reflects your personal values, that won't cause financial and emotional stress down the road, and that won't leave you with wedding-cost remorse as you struggle to reach your future goals.

That doesn't mean you can't have your dream wedding. It just means that, as with any other financial decision, you have to consider your short-term vs. long-term goals, review your priorities, and create a realistic plan of action. As I've written before, there are ways to keep your wedding budget on track. But I believe the best way is to plan a wedding that's true to what you want now but doesn't get in the way of what you and your spouse hope to achieve in the future.


Have a personal finance question? Email us at Carrie cannot respond to questions directly, but your topic may be considered for a future article. For Schwab account questions and general inquiries, contact Schwab.

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