I consider myself to be very traditional, and think that you should save up you salary and wait to buy an engagement ring until you can afford it. In fact, I think your bride-to-be should value that more than going into debt for an engagement ring.
However, I saw a commercial on TV yesterday about 0% financing for an engagement and wedding rings at a local jewelry store (which was actually a nationwide chain). I found it to be a little off...
I think a marriage should start on a solid financial footing as much as anything else, and I don't think going into debt for a ring is worth it. However, there must be a demand for it since it was advertised on television!
So, I wanted to reach out to reader and see what there thoughts were on financing an engagement ring? Yes? No? Maybe?
Note: This ask the reader is several years old but we revive it from time to time to see what new opinions people may have. Plus, there are some new stories I wanted to share!
The Pros Of Financing An Engagement Ring
Before we start the bashing of financing an engagement ring, there has to be some "pros" right? It's clear if you scroll through the comments that most readers don't think you should finance an engagement ring. But there are some people that think it's okay.
For example, one of the strongest arguments for financing a ring is simple: If you can get a 0% for 12 months deal, why not take it and then pay it off over the 12 months - it's effectively free money. And that's totally valid.
You're not going to find a 0% APR offer many places (especially when you're looking at the best personal loans).
Check out what these readers had to say:
Taking advantage of a great financing offer can actually help you because you get all that extra time to save and/or invest.
If you can get 12 months at 0% APR, the value of not having to pay could be a significant amount of interest. For example, if you check out the best rates on our high yield savings account table - you can currently earn about 2.25% on a savings account.
If you were going to spend $5,000 on an engagement ring, you could instead save that money and earn $113.67 in interest over the course of that year. Then, you simply pay off the loan for the ring.
That's a great deal, right?
The Cons Of Financing An Engagement Ring
There are a lot more concerns about financing an engagement ring that there are positives. There are a few main buckets that the concerns fell into:
- You shouldn't have to buy a ring you can't afford to impress your soon to be wife
- You shouldn't start a marriage going into debt (or go into debt in general)
In the first bucket, you and your soon-to-be wife should be on the same page when it comes to money. And hopefully that is a positive page when it comes to money. If you can't afford to pay cash for an engagement ring, you likely shouldn't do it.
You should either: save more money and buy the ring, or spend less money on a ring. Check out this thought from a reader:
If your partner loves you, you don't need to go out and spend a fortune. Getting married isn't about the ring, it's about spending your lives together.
In the second bucket, you shouldn't be going into debt ever (but definitely not to start a marriage). In fact, many people are working themselves out of debt to begin with, so you shouldn't be adding more to buy a silly ring.
I love this comment from a reader:
That's such a great thought - if you can't afford the ring, can you really afford a wife and kids? Especially the kids part - because kids are expensive.
I think most readers agree that financing an engagement ring is a big no-no.
Do You Even Still Need To Buy An Engagement Ring?
The old rule about an engagement ring is that the husband should save 2 months salary and use that to buy a ring. But, do you even need to buy an engagement ring still? And if you feel that you do, do you really need to go "all out" with two months salary?
Millennials are changing the game when it comes to buying things - including engagement rings. Most millennials really don't have a big value on things, and view an engagement ring as a waste of money.
That's not to say that they don't want a ring, but many are opting for alternatives to a ring or a cheap ring. A story recently stood out from Stefanie O'Connell, where she returned her engagement ring. She and her soon-to-be husband put a higher value on other things, versus having a fancy ring.
But don't think you have to go ring-less. Most people would be happy with a simple band that you can get for $200 or less. You can buy an inexpensive wedding band at places like Costco, and still have a ring but be frugal while doing it.
The fact is, most people aren't financing an engagement ring as a 0% APR hack. Most people are financing an engagement ring because they can't afford the ring they "really think their spouse wants."
If you really want to get a ring, keep it simple. You can always upgrade the ring later if you really do place a higher value on it than you initially thought. It could make a great anniversary present.
But the bottom line is you likely shouldn't finance an engagement ring.
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.