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The $28,000 question: Why are we all hypocrites about weddings?

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On Saturday night, I was out with some friends, including one who’s planning her wedding for next August. I’ve had a bunch of family weddings in the last few months, so I suggested she check out a nearby stationery store for her invitations. “It’s really expensive, like $14 per invitation. But at least you can get some ideas for design.”

She looked at me and, without a hint of arrogance, said, “Oh, I’ll check it out. I actually talked to my family and we have an unlimited budget for the wedding.” With one sentence, I was rendered speechless. She didn’t brag. She just said it matter-of-factly: Her wedding could cost anything and it was ok.

She comes from a very wealthy family, so this isn’t such an unusual thing. What is unusual, however, is that so many people will scoff at the above story — and then proceed to spend ungodly amounts on large purchases like a new home or a wedding while steadfastly insisting how absurd “most” people are. Today, I want to write about how to plan for these large life events. But be prepared — you’re going to have to confront the hypocrisy that we all have when it comes to these purchases.

Of course your wedding will be simple
When my first sister called me to tell me that she’d gotten engaged earlier this year, I was out with my friends. I ordered champagne for everyone. When my other sister told me she was getting married a few months later, I told all my friends again. Then I found out they were having an East coast wedding and a West coast wedding — each — for a total of four weddings in a few months. I ordered a round of cyanide and made mine a double.

That’s what got me started thinking about weddings recently. The average American wedding costs almost $28,000, which, the Wall Street Journal notes, is “well over half the median annual income in U.S. households.” Hold on: just wait a second before you start rolling your eyes. It’s easy to say, “These people should just realize a wedding is about having a special day, not about putting yourselves in crippling debt.”

But guess what? When it’s your wedding, you’re going to want everything to be perfect. Yes, you. So will I. It’ll be your special day, so why not spend some extra money to get the extra-long roses or the filet mignon?

My point isn’t to judge people for having expensive weddings. Quite the opposite: The very same people who spend $28,000 on their weddings are the ones who, a few years earlier, said the same thing you’re saying right now: “I just want a simple wedding. It’s ridiculous to go into debt for just one day.” And yet, little by little, they spend more than they had planned — more than they can afford — on their special day. Why is that?

The spending for weddings increases year after year. Yet we insist that we will be different: Of course we won’t spend that much. Of course we’ll have a budget. Of course we’ll have a small simple wedding. Sure we will.

So what should we do?
So knowing the astonishingly high costs of weddings, what can we do?

I see three choices:

Cut costs and have a simpler wedding. Most people, frankly, are not discplined enough to do this. I don’t say this pejoratively, but statistically: Most people will have a wedding that costs tens of thousands of dollars. (If you want to debate the difference between the average or median amount, see here or below for a simulated wedding budget.)

Do nothing and figure it out later. Most people do this. I spoke to a recently married person I know who spent the last 8 months planning her wedding, which became a very expensive day. Now, months later, he and his wife don’t know how to deal with the debt resulting from the wedding. If you do this, you are a moron. But you are in good company since almost everybody else does it, too.

Budget and plan for the wedding. Ask 10 people which of these choices they’ll do, and every single one of them will pick this one. Then ask them how much money they’re saving every month for their wedding (whether they’re engaged or not). I guarantee the sputtering and silence will be worth it. (Leave a comment describing what happens!) This is a great idea in theory, but is almost never followed in practice.

We actually have all the information we need: The average age at marriage is about 27 for men and 26 for women. We know that the average amount of a wedding is about $28,000. So, if you agree with this choice — and you don’t want to go into debt for your wedding — here’s how much you should be saving (RSS readers, click here):

Most of us haven’t even thought about saving this amount for our weddings. Why not? What do we do instead?

We say things like,

  • “Wow, that’s a lot. There’s no way I can save that. Maybe my parents will help…”
  • My wedding won’t be like that. It’ll be simple and elegant”
  • “I’ll think about it when I get engaged”
  • “Luckily, I won’t have to pay for it.” (Who will? Is your future spouse thinking like this?)
  • “I have to marry a rich guy” (I’ve heard people say this and and they were only half-joking)

More commonly, though, we don’t think about this at all: one of the most major expenditures of our lifetimes, which will almost certainly arrive in the next few years, and we don’t even sit down for 10 minutes to think about it. Something’s broken here.

Here’s a sample expense sheet of a wedding. Try playing around with it (RSS readers, click here):

(Figures taken from my dad, recent wedding-planning expert, and partially combined with these figures and these figures.)

Note how changing the amount of guests doesn’t really change the cost very much: Reducing the headcount 50% only reduces the cost 15%. Creating a simple, affordable wedding, it turns out, is surprisingly hard.

It’s not just weddings
Weddings are just one example. We don’t plan out our largest expenses, like houses, cars, and even kids. This is what I call conscious spending but, honestly, it’s much easier to simply ignore these looming purchases and think about them later.

The problem is, if you don’t plan ahead, it becomes much, much more expensive. From the example above, a 25-year old who starts saving for his wedding will have to save 3.5 times the monthly amount a 20-year old will. The alternative is to simply finance it, which makes it even more expensive because of interest. This is especially true of long-term loans for houses.

Some recommendations
1. Be realistic. Even though you’re reading personal-finance blogs like iwillteachyoutoberich and are probably better at your finances than 99% of other people, you’re still human. Your wedding (and mine) will be more expensive than we plan. The head-in-the-sand approach, however, is the worst thing we can do. Sit down and make a realistic budget of how much your big purchases will cost you in the next ten years. Do it on a napkin — it doesn’t have to be perfect! Just spend 20 minutes and see what you come up with.

2. Set up an automatic savings plan. Since the last recommendation to make a budget was completely unrealistic and almost nobody will do it, I suggest just taking a shortcut and setting up an automatic savings plan. Assume you’ll spend $25,000 on your wedding, $20,000 on a car, and (however much) on a down payment for a house. “But Ramit,” you might say in an annoying perfectionist voice, “that’s almost $3,000 per month. I can’t afford that!” Can you afford $300? If so, that’s $300 better than you were doing yesterday. Now that you’ve read this, your preparation — or debt — is a choice.

3. You can’t have the best of everything, so use the P word. Prioritization is such an important concept. Like I said, it’s human nature to want the best for our wedding day or first house, and we need to be realistic about acknowledging that. With that said, we simply can’t have the best of everything. Do you want the better food or an open bar at your wedding? If you have the costs on paper, you’ll know exactly which tradeoffs you can make to keep within your budget. If you haven’t written anything down, there will appear to be no tradeoffs necessary. And that’s how people get into staggering amounts of debt. For the things you de-prioritize, beg, borrow, and steal to save money: Use a public park instead of a ballroom, ask your baker friend to make the cake, and ask relatives to help with cleanup. This is where, if you plan ahead, time can take the place of money.

Ideally, you do #1 (simplify) and #3 (plan). But even if you can’t simplify, at least you can plan.

The result — and what to do today
Today, sit down and plan out the major purchases you’ll have in the next ten years — whether or not you’re engaged or have any plans to buy a house soon. This is really important: Planning before you need to separates rich people from everyone else. Plan out how much you’ll reasonably need. Plan out how much you can save. Then go into your savings account and set up an automatic deposit plan. (I use Capital One 360 (formerly ING Direct) — set up an account in about 15 minutes.) Starting tomorrow, your savings account should have virtual buckets of money for upcoming items (e.g., 30% for your down payment, 25% for your wedding…).

The result: A wedding where you know all the costs and prioritize for what’s important for you. A wedding where, the day after, you’re debt-free and can start your lives together. And the ability to control your spending, instead of having it control you. Sort of like the point of this entire site.

I’ll write more about the logistics setting up automatic savings plan in my upcoming book, I Will Teach You To Be Rich. To get early excerpts and the chance to be featured in the book, sign up for my free newsletter (sample newsletter here):

 

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256 Comments

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  1. funny, here in Spain people also do BIG weddings, having 100 guests is like NOTHING… usually between 200 and 400. How do they pay for it? On the lower part of the invititation letter the couple includes their bank account number and you’re expected to give about 100-120 Euro (130-150 $). There are even people who make a profit with their wedding. The more people you invite, the more money you make.

  2. Two scary thoughts:
    (1) I’m not going to get married in time to meet your 27-year old cutoff. Now I can not only NOT be rich but feel doubly bad on your website sans fiance. Oh, and your publishing a book didn’t make me feel any better, either.
    (2) $28,000 would be a bargain in comparison to most of the weddings I’ve been to. I wonder how the average got to 28k, considering I’ve been to 100k and 250k weddings… yeah, booze, country clubs, and ice sculptures can add up. And if you think that’s bad, should we start saving for bat mitzvahs at 6?

    Really though, Ramit, I think you’ve hit upon a very crucial issue. Whether it be that we spend way too much on weddings (god help me if I have to invite all my family and friends or, worse yet, everyone on my facebook account), or that we just generally don’t plan for any of life’s ridiculously expensive landmarks, we all have a problem. It may cost $1500/month to get by, but that hardly takes into account any sort of down payments, unemployment, engagement rings, graduate degrees, and the like.

    Hopefully many people will heed your advice before we all go into terrible credit card debt and find ourselves imprisoned to gruesome 12 hour workdays.

  3. Since I have been recently married (2 weeks, 2 days), I can say that this happens first hand to a lot of people. Here’s some tips that we used (our wedding was about 10k for 180 guests):

    1. Use your memberships:

    Our reception hall came was at the Officer’s club on Eglin Air Force Base, which was very inexpensive compared to other places at that location. My parents are ex-mil and still O-club members. We were members of a local country club and got a really good discount for the rehearsal dinner. A lot of memberships offer discounts for limos (AAA) and other things

    2. Use your friends (and parent’s friends!):

    – Our music was done by a pianist and my best man’s mp3 player.
    – The pianist plays in New Orleans and the cost for him was a hotel room and a bottle of cognac.
    – We knew the photographer and the florist, and they were both done at cost.
    – My friend’s parents did the engraving for my groom’s gifts.
    – The jewelry my wife and her mom wore were loaned out by Valobra Jewelry. The pieces retail for twice the cost of our wedding.
    – I had previously worked for the church wedding planner, and my wife and I both were friends with the pastor.

    **Networking has its perks outside of the cubicle.**

    3. Sit down and find out what is really important:

    If you have a really cool bride-to-be, she probably won’t give a crap about a couple things. For example, I don’t care what my wedding band looks like because I’ll probably lose it in the next year. Also, think about it from another perspective — your guests. When you go to someone else’s wedding, are you going to care whether or not they have a program at the church? We decided no, and didn’t bother. Saved a couple hundred bucks.

    4. Be creative!

    People spending too much money on weddings implies to me that they have no imagination and they have to hire someone to tell them how to make it cool. If you brainstorm a couple hours a weekend, you can find ways to make it work. We went to the beach two days before the wedding to get sand for the centerpieces. We kept two kegs on tap in front of the bar to decrease the service fee for the bartenders. I had enough people renting tuxes from one place that I got mine for free (don’t tell them that).

    Just a couple quick things that came to mind… hope it helps all you lovebirds.

    Steve Place

    PS: One more thing, and I don’t want to sound sexist… this is just from experience: 3 months before the wedding, block ALL wedding shows on TV (Bridezillas, my super platinum wedding, how to get a bank loan for a ring)… it helps reduce stress as well as compulsive spending.

  4. For the past few months, NPR’s “Marketplace Money” has been profiling a couple in the middle of planning their wedding. Here’s the comment I sent them:

    What I find amazing about this series is the fact that noone questions the sanity of the whole enterprise. Why get married in the first place? The tax laws certainly discourage it. And if you are set on marriage on religious or other grounds, why have a wedding that puts financial strain on the young couple, their parents, and even their friends?

    My wife and I went to the city hall to get married. The wedding cost us less than $200. We are not poor–our combined income is well over $200,000/year–but we would much rather take five additional vacations in Europe or Hawaii than donate money to the wedding industry.

    I also posted it here for others to agree/disagree with me:
    http://www.smargue.com/s/bfdeaaa4f60147fdba0521e278531302/Ruinously_expensive_%28i.e._average%29_weddings_are_dumb%21.html

  5. Your notion that nobody has a simple wedding is a little … odd, and probably speaks more to the circles you travel in than anything else. I make six figures, but we spent three grand on our wedding, and have equally comfortable friends who spent less. But yes, of course you should spend what you want.

    I read another stat that may relate to one of the points you’re making recently – something like 75% of Americans think “people are too materialistic” but something like 8% think they personally are.

  6. I get tired of all the commenters on the myriad PF blogs with wedding posts talking about how insane it is to spend 25K for a wedding and how they had a perfect wedding for 3K, etc, etc, so this is a relatively refreshing new take on the matter. Of course it’s insane to spend that much money, but the reality is that most people will do it when it comes down to Their Special Day. It’s a once in a lifetime event, after all!!!! (Allegedly.) Someone should at least talk about how to try to pay for it somewhat responsibly.

    Anyway, Ramit, do you have a special “wedding” savings account? Are you seriously doing this every month? Honestly, I just can’t imagine a guy doing this, so I’m curious since you’re advocating it.

    • Don't be fooled Link to this comment

      And over 50% of those marriages will dissolve within 5 years. That’s real special.

  7. Great post. Planning for my wedding was one of the big reasons I wound up starting Wesabe. I completely agree about automated savings (automated everything, really).

    My best tip for having a reasonable wedding is to find things where you and your partner can agree not to spend. I’m a big dessert person (pun intended), so I insisted on having good (==expensive) cake. She really wanted great pictures, so we spent more on a photographer than the minimum. Unfortunately, we had a lot of categories where one or both of us felt strongly. We saved the most when we could agree that the category didn’t have to be a priority (for instance, the flowers were on the cheaper side, and the music was from an iPod).

    We didn’t do this, but one way to get to a lower cost would be to give each person two or three category choices. If you both choose a category (for us, food was very important), spend a bunch on that. If one of you does, spend on it but not too much. If neither of you does, go for a very inexpensive option. Given the number of things you could potentially spend money on at a wedding, even if there’s no overlap, you’ll still save money.

    But, my friends who went for the Vegas wedding definitely saved a ton. I haven’t had a better experience, ever, than our wedding and honeymoon, so I got a lot of value out of what we spent. But Ramit’s point, that budget becomes unreal the closer you get to the wedding, is right (forgive me) on the money.

  8. Another thing is that a lot of DIY elements or less expensive items look as good as their pricey counterparts.

    * Buying a white prom dress at an end-of-season sale can look better than a dress bought from a bridal boutique. There’s also dresses that can be bought for cheap on Ebay, and not all of them are used.
    * A simple gold, white gold, platinum, titanium, or silver wedding band that is simply worn next to the engagement ring instead of connecting to it, is a lot less expensive than a bridal set. Engraving the inside is very inexpensive if you want it personalized.
    * Few people like DJs, so burning CDs or having a playlist of MP3s set up on your computer or ipod (a friend can even man the music when needed) is cheaper and sure to play only the songs you want.
    * There’s nothing wrong with having the reception in the church fellowship hall. University student unions, public parks, some museums, friends’ backyards are also other less expensive places to hold the festivities.
    * Buy an invitation kit for $30 and print them at home or go creative and make your own unique invitations.
    * Bring your own alcohol if you can — much cheaper to buy kegs of beer and cases of wine from a liquor store. Plus you might be able to return the unopened wine.
    * Have a small wedding cake for display and a big sheet cake in the kitchen to be used for serving.
    *Have a friend do your hair and makeup.
    * Borrow jewelry from relatives and friends or wear what you already have.
    * Drive your own car — a friend can even drive it for you.
    *Morning celebrations are less expensive than afternoon celebrations are less expensive than evening celebrations.
    * A cocktail reception with just some drinks and a lot of appetizers for a couple hours makes for a nice, low-key event.
    * The little details don’t really matter to guests. They’re really happy if they got to see the wedding, had something to eat and drink, and got to see the couple. Centerpieces, matching everything, butterfly releases, bows everywhere, etc, don’t get remembered.

  9. That’s funny — my then girlfriend and I always talked about having a big, elegant wedding, but never thought about the costs. When the time finally came to plan it, we were seniors in college and quickly realized we wouldn’t be able to afford the “average” wedding! We cut the guests from 200 down to 100 and asked favors from about 2/3 of the guests. We also held the ceremony at a church for a donation of $200 and a $100 gift to the pastor. The reception was done Chinese style at a restaurant at $40 a head. Our friends/guests did everything for us, including making all invitations and decorations from scratch. Ceremony cost: $4000 Reception cost: $5000, including tip and wine. It was still the loveliest day of our lives and we cut costs by at least half.

  10. It would be interesting to see some more useful statistics, such as the median, about wedding costs. You throw a couple of million+ celebrity/ultra-wealthy weddings and the averages quickly get skewed upwards.

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