When you’re arranging your big day, there’s a lot to pay for: the venue, food, photographer, dresses, suits, transport, jewellery… sometimes, the list can seem endless!
Unfortunately, though, it’s often the case that the money you have to fund your wedding is not endless. In this scenario, you might consider borrowing money to pay for your big day. If you are in this position, Debt Advisory Centre (who wrote this article) has put together some tips (based on their new research) that might help you decide.
Choose the right method of borrowing
17% of the married couples we asked in our research had borrowed money to pay for their wedding. If you definitely want to borrow, you’ll need to choose a method that’s right for you.
For example, if you choose a credit card, you’ll need to make sure the credit limit is big enough for what you need. It’s also worth looking into cards with an interest-free period (for as long as possible), so that interest won’t accumulate on a potentially large balance. However, you’ll need to make sure that you can repay or move the balance before your interest-free period ends – unless you’re happy to start paying the interest. Bear in mind that interest-free credit cards are only available to people with a good credit rating.
If you choose a loan, look for one with a low interest rate. When you choose your repayments, make sure they’ll fit comfortably into your budget. However, do try to repay a loan (especially a large one) as quickly as you can – otherwise the level of interest you will pay will be high.
However you borrow, make sure you can pay it back over a reasonable period of time, and that interest won’t mount too high. For this reason, things like payday loans are definitely not suitable.
Don’t borrow too much
28% of couples who borrowed to fund their wedding wished they’d borrowed less. That’s why it’s important to think about the size of your repayments and whether they are manageable – especially if you’re going to be repaying for quite a long time.
Think about your future
About a third (34%) of the couples we talked to said they were still repaying what they borrowed for their wedding. It’s important to keep this in mind when you borrow. After all, getting married is just the beginning of your journey together. There are many big financial commitments that might come afterwards, like buying a house or starting a family. To use a holiday analogy: you don’t want to spend all your money on flights and find you don’t have any money to enjoy yourself when you get there.
Don’t try to ‘keep up with the Joneses’
These statistics might be useful to an extent – to help you decide whether borrowing is right for you. However, you shouldn’t base your decision on what other people are doing. Borrowing money is a big commitment that can stay with you for a number of years. It’s important to think very carefully about whether borrowing is right for you.
Consider the alternatives
18% of the couples who’d borrowed to pay for their wedding wished they hadn’t borrowed anything at all.
That’s why you should consider the alternatives before you borrow, for example:
· Arrange your wedding on a budget. There are loads of sites and blogs out there with useful tips and ideas to help you
· Postpone your wedding plans so you can save up for a bit longer