||Ask Dr. Don
Budgeting for wedding bells
Dear Dr. Don,
I am getting married next August. My fiancee and I both come
from large families, so we know that we're having a big wedding.
We've both taken second jobs to cover the wedding's cost and to
diminish our debts.
We estimate spending $25,000-$30,000 on the event.
We both own homes and have about $6,000 in credit card debt between
us. She owns her car while I still make payments of about $170 a
month. Our combined annual income is over $60,000 and we live in
I've considered opening a wedding account for us to
pool some of our income to pay off expenses. Plus, any family members
who wish to contribute can make a deposit as well. I have two questions.
First, what would be the best option for a wedding account? Second,
what would you consider the best approach for savings and investment
following the wedding?
Congratulations to you and best wishes to your fiancee. The
steps the two of you are taking to get a handle on both paying for
the wedding and whittling down your outstanding credit balances
prior to getting married are smart moves.
The average cost of a wedding in America is between
$18,000 and $21,000, according to Bride's magazine. If you haven't
done it already, spend some time putting together a budget for the
wedding. There's a lot of advice available on how to trim costs
without looking like you're cutting corners. Bankrate weighs in
with a Guide
to weddings and finances that includes a feature showing the
Top 10 ways to save money on your wedding.
I like your idea of opening a separate account to
accumulate the savings that will pay for your wedding expenses.
But suggesting to family members that a deposit into the account
would be welcome is over the top. If family members, without any
prompting by you, volunteer to help defray part of your wedding
expenses then you can deposit that money yourself. There's no way
to put the right spin on announcing the availability of a wedding
account along with the account number for the family's convenience
in depositing funds.
With such a short time before you need the money and
given the low interest rates currently available, there's no real
advantage to aggressively chasing rates for these deposits. Just put it in a money market account so it will be both safe and available. You can find
rates in your area for money market accounts using Bankrate's
Since you won't need two houses come next September,
discuss where you're going to live as a couple and how you're going
to treat the proceeds on the sale of one or both of your current
After you've paid off the wedding expenses, don't
just look to bank accounts for your investment choices. Diversify
between stocks, bonds and cash investments as you invest for long-term
and intermediate-term financial goals.
-- Updated: June 12, 2003