The age-old rule of thumb – established by the jewelry industry – is that you should spend roughly three months’ gross pay on an engagement ring. But statistics show that the average person actually shells out roughly one-and-a-half month’s salary. The average engagement ring costs around $4,000, while the average male age 25-34 – the predominant proposers – pulls in about $8,500 over three months, according to Census data.
Ignore the statistics, though. While most people are under the impression that there is a specific dollar amount or percentage of their income that must be spent on a ring, what actually matters is how much you can comfortably afford based on your current financial situation. Below, we’ll help you make that determination by explaining the most important questions to ask yourself before buying a ring as well as by laying out alternative payment options and providing money-saving money tips.
Spending Guidelines & Key Considerations
There are a variety of individualized factors that dictate how much you can, and should, shell out for a ring. The specifics of your current financial situation as well as your earning potential in the immediate future obviously are major concerns. The potential availability of a family ring is also worth looking into, as this would drastically reduce your financial burden.
In order to determine how much you should spend on this symbol of your love and devotion, we recommend asking yourself the following questions:
- Am I In Debt?
If you are already behind the financial eight ball, you don’t want to exacerbate the problem with a major expense like an engagement ring. Expensive finance charges and credit score damage are surefire ways to make newlywed life far less of a honeymoon.
Your options in this situation depend on your timeline. For instance, have you been issued any ultimatums about when your significant other wants to be married? If so, you’ll likely have to go with a simple ring for the time being and then either add to it or replace it down the road. If you have some time to work with, it may be worth taking steps such as transferring your debt to a 0% balance transfer credit card in order to pay of amounts owed as quickly as possible and then get to saving for a ring.
- How’s My Emergency Fund?
You don’t want your engagement ring purchase to leave you financially vulnerable. So, proceed as if that money doesn’t exist. After all, while we warn against incurring debt for a ring purchase, doing so is better than cutting away your financial safety net. That would make you susceptible to serious financial difficulties if an unexpected expense befalls you.
- What’s Our Limit On Wedding Expenses?
There’s only so much money to go around, so you really need to discuss how you wish to allocate funds between the engagement ring, wedding bands, wedding ceremony and honeymoon.
- How Picky Is My Soon-To-Be Fiancé?
This is perhaps the most important factor, as it can significantly limit or expand your options. Your significant other may have certain expectations regarding when the proposal will come (and what happens if it doesn’t), what the rock is like, how big the wedding is and where you honeymoon. You need to take all of this into account so that you don’t overextend yourself on this first major purchase.
- How Much Stock Do I Put In Statistics?
A 2014 study from a pair of researchers at Emory University found that men who spent more than $2,000 or less than $500 on an engagement ring were more like to get divorced than those who shopped in the $500 - $2,000 range.
Engagement Ring Financing Options
If you can’t pay for your engagement ring in one lump-sum, there are a number of options at your disposal that enable you to pay over time. We’ll give you a brief introduction to these options below.
- 0% Credit Card: If you have above-average credit, you may be able to get a 0% introductory rate on new purchases for up to 21 months. This could provide you with more than enough time to pay off the cost of your ring in digestible monthly installments. Just make sure to use a credit card calculator to determine what monthly payments you’ll need to make in order to be debt free by the time high regular interest rates take effect.
- Lines Of Credit: You may be able to get a higher spending limit than a credit card will provide by instead opting for a line of credit from a bank or credit union. This might be tough for young people to achieve, however, due to their less-established credit, relative lack of collateral and perhaps limited disposable income.
- Merchant Financing: Most large jewelry store chains offer financing options directly. While these plans can be a good deal, it is extremely important that you carefully read the terms and conditions before signing up. Merchant financing plans often have hidden clauses, such as those allowing deferred interest to be charged, that may not exist with other financing methods.
- Engagement Ring Loans: A cottage industry does exist around loans specifically intended for engagement ring purchases but, at the end of the day, any loan will really do. Whether or not one of these loans is a good value depends on how its terms stack up against the best credit cards, lines of credit and merchant installment plans that are available.
Ways To Save On Engagement Rings
Financing certainly is one way to save on an engagement ring, particularly if your significant other has their heart set on a certain type that will cost a given amount, which you don’t have in full at the present time. But there are plenty of other ways to save too, from eliminating the need to buy a ring altogether to selling some of your stuff in order to subsidize the cost.
Below we’ll give you a breakdown of some of the best savings techniques.
- Use A Family Ring: Sentimental history can’t be beat, so if you have access to a family heirloom ring, seriously consider using it. Not only will it better signify the union of your families than a store-bought ring, but it also zeroes out your necessary expenses. You’ll just need to cover the cost of cleaning and sizing.
- “Lab-Grown” Diamonds Are Real Diamonds: All diamonds are 100% carbon, whether they were mined from the earth or grown in a lab. As a result, don’t let a jeweler dissuade you from purchasing a synthetic diamond if that will save you money. It’s not a fake and no one will be able to distinguish it from a natural diamond.
- Test Their Eye: People often joke about this, but you could always get a cubic zirconium ring instead of a diamond. It’s very hard to tell the difference, and the average CZ ring only costs a couple hundred bucks. However, the need to get a CZ is likely far lower now that we’ve found a way to economically produce synthetic diamonds.
- Shop Vintage: In addition to supporting the use of a family ring, the fashionability of vintage items for weddings also opens up your purchase options. From pawn shops to yard sales, wherever you can find rings for sale is worth exploring.
- Have A Yard Sale: You can also leverage yard sales to raise a bit of extra cash to pay for your ring. Your spouse will likely want to get rid of a lot of your things anyway, so why not control how they’re disposed of and use the process to benefit your wallet? Most people could easily raise a few hundred bucks with the things sitting around their homes right now.
- Go Romantic & Plan To Update: If you simply can’t afford a fancy ring, you could always make a very simple setting that has room for stones to be added at a later date. You could even temporarily opt for a Ring Pop instead of an actual ring if you’re into romantically symbolic gestures.
Image: Africa Studio / Shutterstock
