Getting married is an exciting time in your life. Now that you’ve found your partner for life and you’re engaged, it’s time to start planning the wedding. For many newly engaged couples, the cost of the wedding can come as an unwelcome surprise.
Weddings today are an expensive business. When you add up the food, venue, photographer, dress, flowers, cars and so on, it is not surprising that the average Australian wedding today costs $36,000. Weddings can also come at a time in your life when you have multiple savings goals, for example, saving a deposit for a house, making additional repayments to reduce your mortgage, or even saving for a holiday. Having numerous saving goals can make surviving your wedding debt-free seem like an impossible task.
Today, we are seeing couples use a number of different resources to pay for their wedding – 56% receive a contribution from their parents, 60% get a loan, 18% use their credit card, while 82% use their savings. A wedding is a once in a lifetime celebration and it is important that you make this day special for you and your partner, but you need to be careful not to go into debt.
Here are some tips to ensure you stay on track for your big day:
- Discuss finances with your partner – Agree on a budget that you can afford from the outset and stick to it. Take the time to prioritise the things that are important to you both and agree on what sacrifices you can make. If your parents are helping you with the costs, have the discussion with them early on, so you clearly understand how they would like to contribute and can build this into your budget.
- Plan for your big day – Create a cash flow plan and budget as early as possible, giving you the maximum time to build up your savings. It is important to understand when payments will be due and have the money available at those milestones. For example, deposits will need to be paid upfront, but final payments are often only due a short time before the wedding. You can also plan your bills to be paid across a few months, which can help alleviate some of the pressure of paying everything at once.
- Look at more than one supplier – It pays to shop around, so make sure you get more than one quote to ensure you are getting the best deal.
- Consider an “off-peak” wedding – choosing to get married in the winter months, or on a Friday, for example, can save you significant amounts of money. Many suppliers offer hefty discounts or include additional services for free for off-peak weddings.
- Don’t put off important life events – It may seem easier to delay other financial goals, like saving for property or a holiday, but it is possible to save for multiple goals if you have the right plan in place.
It’s also important not to forget that finances will continue to play a big role in your life post-wedding. Nearly one in five couples don’t talk about their finances until after their wedding, and a further 15% don’t discuss them even after the big day. By making a few simple financial decisions before you get married, you can help your finances and your relationship in the long run.
With weddings being such a large financial burden, it is easy to see how other factors can get pushed aside, but having an open discussion about your joint financial (and non-financial) goals will ensure you have the same priorities and are working together for the same things. Whether your goal is to start a family or a round the world trip, your spending and saving habits as a couple need to reflect this. You’ll also need to decide how you run your finances: Will you keep separate accounts or have joint ones? Does one of you want to play a more active role in managing the accounts, bills and repayments or will you share the responsibility? It is important that, no matter how you decide to set-up your finances as a couple, it is a mutual decision.
Lastly, it is important to make sure you and your partner are protected as you enter this new phase of life. So make sure you update your Wills, Power of Attorney, and Insurances so you are both covered if something unexpected were to happen.