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Wedding Crasher!

July 28, 2010

Don't let debt crash your wedding

This past weekend my family and I enjoyed watching my wife’s friend get married. The wedding and reception were really tastefully done (quite literally – the beef and chicken at the reception were delicious). All in all, it was a great event. Yet, for some reason, I grow more cynical with every wedding I attend.

Today, the average wedding costs between $19,000 and $22,000. The average cost of a honeymoon is somewhere around $3,500 to $5,000. The average cost of an engagement ring is $3,500 to $4,500. Based on these averages, the cost for the engagement ring, wedding, and honeymoon could be around $28,000.

It is important to point out that there are some very extremes on the top end of costs that make these averages a little higher than what the average American pays, but at least these figures give you an illustration of how expensive weddings are. 

Is it worth it? This is a question every couple needs to explore for themselves. Personally, I think this amount of money is ludicrous to spend on a wedding when one looks at the alternatives. One could buy a very nice new car for $28,000, or this could be a 20 percent down payment on a $140,000 house. If one invested this in a general mutual fund and could earn an eight percent annual return for the next 40 years, that $28,000 could turn into a little more than $600,000.

It comes down to each couple’s decision on opportunity cost, or the next best thing they could do with the money. For some couples, the idea of the wedding, reception, and everything that goes along with it is worth more to them than a new car or a down payment on a house or a good start on a retirement fund. For most though, I think they have just got caught up in the escalating wedding arms race.

The worst scenario is if the wedding has to be financed by credit cards. With an interest rate around 20 percent, the wedding will cost you $1,120 a month for the next 33 months with a total bill of $36,960.00. When a couple needs to borrow to pay for a wedding, it can create trouble right away. There are a lot of different stresses to new marriages and when you add on a huge debt from the get-go, it can make the situation a lot more difficult.

Around 50 percent of in the U.S. marriages end in divorce. Finances can play a big role in some divorces. In fact, it is one of the top reasons that cause couples to fight.

Even though it is tough to buck the trend of trying to have a better wedding than one of your friends who got married before you, why don’t you try to one up them by having an even more impressive marriage? This may not be as flashy for all to see, but will bring you and your spouse a lot more happiness down the road.

What can you do to keep it classy, but not break the bank with your wedding? Some of the tips I have seen is trim the guest list, have it during the off-peak wedding season, pool your friends’ and families resources and get crafty, among others.

Personally, I say get married in Vegas. For a couple thousand dollars you can have your wedding very tastefully done with music, flowers, pictures and the service. An added bonus is you can rent your tux the morning of, and if you have a big enough hotel suite, a small reception of cake and champagne lets you mingle with friends and family who could come, while not breaking your budget. This is not for everyone, but my wife and I have great memories of our Vegas wedding, and we would not have had it any other way.

I want to hear your tips for saving money on your wedding. E-mail it to me, and I will compile a list to share in a future article. If interested, send your tip to me at andrewlong@fastmail.fm or comment below.   The best submission, as determined by my panel of judges, will win a prize. To be eligible for the prize, submit your tip by Aug. 31, 2010.

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