If you’re dreaming of a big, gala-style wedding, you’re certainly not alone. Numerous studies show the average U.S. couple spends nearly $30,000 on their wedding. That’s a lot of cash (or credit) to shell out for a single day.
While your wedding day signifies an incredible milestone, you shouldn’t let one big party set back your financial future. To help you put things into perspective, we’ve compiled seven things you can do with a large wedding budget. Opt for an intimate celebration, and you can…
- Pay Off Debt – Debt is one of the top issues couples argue about. Credit cards and student loans, among other lines of credit, can take decades to pay off. Paying them off now can potentially save you thousands of dollars in interest payments down the road – and save you a lot of stress.
- Create a Nest Egg – Are children in your near future? Where do you hope to settle down? Use the money you would have spent on a large wedding to create a nest egg. Set aside money for baby expenses, home remodeling, relocation or other major expenses on the horizon.
- Create an Emergency Fund – Most Americans lack a sufficient emergency fund, which can be vital in the face of job loss or health problems. Use your wedding budget to create an emergency fund and obtain some much-needed peace of mind in the process. An emergency fund is typically housed in a general savings account with at least three to six month’s worth of living expenses.
- Buy a New Home – If your first big purchase is a new home, consider putting part of your wedding budget toward a down payment. A larger down payment will decrease mortgage payments and free up more money in your daily budget.
- Fund an Education – Are you still in college, or thinking of going back? The average budget-busting wedding costs the same as four years of tuition at many colleges or universities. If going back to class isn’t in your future, what about your children’s future? Start a college fund to prevent the financial pinch when you send junior to college.
- Start Investing for the Future – If you’re entering into a marriage without high-interest debt and have already stashed away an emergency fund, brainstorm other avenues to save for the future. Consult a financial planner who can help you understand different investment options with your individual goals in mind, such as early retirement or traveling.
- Save for Retirement – It’s never too early (or late) to start saving for retirement. You can use part of your wedding budget to set up an IRA or contribute more money to an existing one.
Before you move forward with any wedding plans, we suggest you create a budget first, no matter your wealth level. This will help you stay on track and avoid impulse purchases. When creating your budget, be sure your expenses don’t negatively impact your ability to pay bills or meet daily living expenses. In addition to obvious costs such as the dress, venue and photographer, take into account these hidden costs of weddings as well.