Borrowing for a wedding? You could regret it - Loans - News - Moneyfacts

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Borrowing for a wedding? You could regret it

Borrowing for a wedding? You could regret it

Category: Loans

Updated: 29/04/2015
First Published: 29/04/2015

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Wedding season is rapidly approaching, and if you're about to celebrate your nuptials, we have just one question – how are you paying for it? Hopefully you'd have saved up enough to ensure that everything's covered, but research has revealed that a quarter of couples plan to borrow money to fund their dream wedding, something that could put a downer on future marital bliss.

The true cost of a dream wedding

Research from Debt Advisory Centre has found that the pressure to have a dream wedding can come at a cost for some couples, with 23% of those surveyed admitting that they borrowed to fund their big day – to the average tune of £3,800.

Unfortunately, many people regretted it afterwards, with almost half (47%) of those who took out credit for this reason saying that they wish they'd either borrowed less or hadn't borrowed at all. The financial hangover can last well after the honeymoon comes to an end, too, with 29% of couples still repaying their wedding debts after six years of marital life.

This has the potential to ruin marital bliss, the report noted, as debt is one of the leading causes of relationship problems. The figures suggest that it could impact younger couples more than their older counterparts – those aged 18 to 25 are far more likely to use credit to fund their wedding, with 65% of those surveyed admitting to doing so. They're also the age group who are likely to borrow the most, with 15% taking out over £5,000.

"As the culture of glamorous celebrity weddings has grown, it's easy to see why couples feel under pressure to recreate the lavish events they see in magazines," said Melanie Taylor, a spokeswoman for Debt Advisory Centre. "While celebrities can afford to spend enormous amounts on their dream weddings, for most people this kind of luxury is out of reach and it's not advisable to get into debt to meet these aspirations.

"Getting married is about making a lifetime commitment, not just one day of extravagance. [It] might seem like the most important day of your life, but nothing is more important than your long term happiness and security, so keep this in mind and plan for your marriage, rather than your wedding day."

Pay for your wedding without getting into debt

It's all about thinking long term, and if you focus on saving the money for that dream wedding, you hopefully won't need to get into debt in order to fund it. Opening a regular savings account could be a great way to kick-start the savings habit – these accounts often boast higher rates than their traditional counterparts on the promise that you pay in a set amount each month, and after a year you could have a comfortable pot.

Alternatively, if your wedding is further ahead or if you've already got a large lump sum that needs topping up, you could opt for a fixed rate bond of a term to suit your wedding plans. Easy access accounts are another option if you're seeking flexibility, and don't forget about ISAs to maximize your tax-efficiency.

But, if you really must borrow to fund your wedding, make sure to do it sensibly. A personal loan could be an option, tying you in to set repayments so you're completely debt-free thereafter, and with rates at record lows it could be a great time to compare the deals available. Using a 0% purchase credit card could be another option, allowing you to spread the cost without accruing interest.

Alternatively, if you've already used a traditional credit card to cover some of the costs, make sure you're not paying interest! Transferring the balance to a 0% balance transfer credit card will give you plenty of time to pay it off, and if you make sure to clear it by the end of the interest-free period, you won't need to worry about interest adding to the bill.

No matter how you go about it, just make sure both parties are comfortable with the arrangements and then you can enjoy married life without the interference of debt stress.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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