Life is defined by its big events, whether that’s finding the perfect job, tying the knot, or moving into a forever home. Unfortunately, many of these pursuits come with large price tags; to-be-weds are now targeted by wedding loans, according to USA Today, a personal loan product specifically aimed at couples who don’t mind taking on debt to pay for the big day. Ideally, however, taking on anything but minimum interest debt is to be avoided – and so, when it comes to planning the big purchases, getting a budget in advance can be key.
The big day
As highlighted, weddings are one of the main contenders when it comes to accruing life event debt. It doesn’t have to be that way, however – and the key is in budgeting. With the price of the average wedding rising to $27,000, according to CNBC statistics, it’s more important than ever to budget properly. A good way to do this is to break it down into stages – including before the day itself is even decided. When you’re looking to marry, it’s about joint finances and responsibility. Picking out an engagement ring doesn’t mean breaking the bank, and neither do the wedding bands. Putting frugality into every purchase is the crucial principle with making good decisions around wedding planning. The sheer range of outgoings and the amount of variance within that means that focusing on where you can improve will help to keep your finances in order.
Finding a forever home
The process of finding the perfect forever home brings in a new principle – less focused on budgeting lots of small elements, and more focused on doing a few things right. There are two main aspects to this – surveys and planning, and financing. As the Pew Trusts highlights, millions of Americans use risky financing to buy their homes. On top of this, many homebuyers are using poor quality surveyors, which have become more widespread since the rise of digital-only realtors. The trick with making the most of the house buying process is to avoid the false economy. Use high quality planners at every stage of the purchasing process, and budget on that basis; this will save money in the long run.
Sustainable approaches to saving
There are of course a host of other life events which require financial input, such as having a child, heading to a dream vacation destination, or renovating a property. The best prepared people don’t budget for individual items, but have a process of saving and storing their funds over a long period of time. US News recommends saving up to 20% of your income every year, and dividing that up further based on need. You should have an emergency fund that can last up to six months; a contingency fund for your car, home repairs, and regular luxuries; and then savings on top of that.
Being a dedicated saver means you will be ready for any eventuality. Budgeting is a way of life, rather than just a task when a cost comes in.
Veeramachineni Lalitha
I am Finance Content Writer. I write Personal Finance, banking, investment, and insurance related content for top clients including Kotak Mahindra Bank, Edelweiss, ICICI BANK and IDFC FIRST Bank. My experience details : Linkedin