Financial planning to buy an engagement ring

9 April 2019

You have reached the point in your romantic relationship where you are ready to pop the big question and put an engagement ring on your partner’s finger. But rings come in all shapes and sizes – and most importantly – in different price ranges.

How much can you expect to spend?

While the natural inclination is to want to impress your partner, you need to consider your budget and ensure that purchasing an engagement ring does not do damage to your personal finances or push your debt situation over the edge.

So, how do you strike the balance?

While there is no clean-cut answer on how much you should spend, there are a few guidelines.

One rule of thumb is that the cost should equate two months’ salary, but this logic is often unrealistic. Every person’s situation is different, and while some may be able to afford this, for others already caving under debt pressure, it may seem an impossible feat.

This is where many are tempted to take on additional debt. Again, if you’re able to comfortably afford repayments this shouldn’t be a problem. But if you’re already over-indebted, taking on more debt could financially cripple you.

You have your future to consider too. Ensuring you are financially prepared for marriage and the merging of finances between you and your partner is more important than the rock on his or her finger. This is often one of the most important conversations you and your partner need to have to ensure that you are on the same page.

Most people are not unreasonable and appreciate the effort and love that was spent on finding the right ring for them. Here are a few ways in which you can steal your partner’s heart and remain financially responsible:

• Start saving: While this isn’t always the easiest thing to do, it is worthwhile. Put a stop order on your account that ensures that you’re saving a sizeable portion of your monthly salary.

• Shop around: Taking your partner ring shopping is part of the fun. Consider all your options and visit several jewellers to understand what your partner’s likes are and to compare prices. Many jewellery stores have specials monthly where you can get discounts on various rings.

• Consider a coloured gemstone alternative: Diamonds are pricey but there are alternatives to consider too. Ask your jeweller to introduce you and your partner to gemstones such as moissanite instead.

• Opt for white gold as opposed to platinum: The biggest difference between white gold and platinum is in fact the price tag. While they both look the same, platinum is far more expensive.

To buy an engagement ring is a big and exciting step, but it needn’t drain your finances. Instead, plan and consider all your options.

Being overindebted can increase the financial pressure. At the end of the day entering into a marriage on a good financial footing is far better than doing so with tons of debt and big rock on your partner’s finger.

To start the journey towards becoming debt-free and able to plan the rest of your life, contact DebtBusters for a free debt assessment today.