Budgeting for wedding bell bliss

May 30, 2005

Maybe it's because even the romantics among us are more practical these days. Or just that the things we really want seem to cost so darn much. Whatever the reason, there's a growing trend among altar-bound couples to put off the big day until they have saved enough money to pay for the rings, the wedding, a terrific honeymoon, and perhaps put a hefty down payment on the house they will one day call home sweet home.

But all dreams -- whether rational or romantic -- are much easier to imagine than to achieve. So in the spirit of the spring wedding season, here are some basic financial steps designed to help get you a debt-free wedding, into your new home, and on the right path to a financially secure life together:

Look at the big picture. A wedding lasts a day; the rest of your life lasts much longer, so think about your wedding as part of your overall financial picture. Decide what would make a happy wedding for both of you, within a reasonable, affordable budget. And speaking of that 'B' word, don't let it intimidate you: Think of a budget as simply a way to organize and manage your money and use your wedding budgeting process as a good learning exercise for you, as a couple, to work together toward a common financial goal.

Pay for your wedding with real money. You could finance your wedding through credit cards or by "stealing" money from your investments or retirement fund, but don't do it! You'll end up paying for your wedding over many years. (If you put $25,000 of wedding expenses on your credit card at 14 per cent interest, and only make the minimum monthly payment each month, it will take you 100 years to pay it off!)

Establish a financial plan and stick to it. Once you've set a wedding budget based on the money that will be available at the time, start saving toward that goal. And, while you're at it, establish other goals -- like a down payment for your new home -- and start saving ( and investing! ) for those goals, as well.

Be sure to get the most out of your savings by establishing an investment plan. In this way you may be able to move a portion of your savings out of low-interest bank accounts and into investments that deliver better returns. If you don't want to tie up your money for an extended period, liquid investments like money market accounts are a good choice — you get solid returns and almost instant access to your money, as you need it.

Use this simple "dreams to reality" financial planning template to get you going:

When you define the amount you have, the amount you owe, and your expenses, your "real" savings picture becomes very clear. You'll know if your wedding budget is realistic or needs amending, the length of time it will take you to get to a debt-free wedding date, and when you'll be able to comfortably afford your other "dreams." Once you get organized, monitor your progress regularly to stay on course.

Yes, with some smart financial planning, you can realize your dreams without mortgaging your future. A professional financial advisor can help you discover a financially successful new life together.

This page is part of the GayFinance series and is in the WeddingCategory.