Your Wedding and Your Wallet

Dear Altar-Bound,

‘Tis the season to get engaged! November thru February is peak time for proposals. So, if you should happen to be newly engaged and want to spend wisely for your wedding, this post is for you!

Nowadays, the average wedding costs roughly $27,000/year (more in major metropolitan areas), and this doesn’t even include the honeymoon. Umm… that’s a lot of moolah! And this crazy economy certainly doesn’t help the cause. So, how do you afford a fabulous wedding without breaking the bank? Here are 10 tips to help you do just that:

1. Create a realistic budget. As John Maxwell says, “a budget is telling your money where to go instead of wondering where it went.”  I view a budget as a spending plan. It shows me how much money I can reasonably spend each month. So, do the same for your wedding. Write down your net monthly income and compare that to your total monthly expenses. What’s left over? This is your discretionary income. These are the funds that you can use towards your wedding. If the figure isn’t high enough, then you’ll need to cut back. Whatever you do, make sure you don’t commit more money than you can realistically afford to set aside each month (keeping in mind that you still need to save to build up your emergency fund). Use The Knot‘s  Wedding Budgeter to help you plan appropriately.

2. Use cash/American Express only (no credit cards or loans). From day one, you must commit to not financing your wedding. For major purchases (reception, wedding gown/tux, wedding bands, etc.) use an American Express Charge Card (responsibly, of course!) and pay the balance in full when it’s due. Better yet, use an American Express Pre-paid Card. Either way, your purchases will be protected against fraud, and you won’t have an ongoing balance lingering over your head. For everything else, pay as you go with cash. It will do your mind and your marriage a whole lot of good to have everything paid in full by the time you leave the reception. Don’t enter your marriage with the ball and chain of debt.

3. Let there be… lunch! That’s right- consider having a lunch reception (you may even be able to get away with a brunch reception, if you plan it right). Shout out to Pastor Tejado and Co-Pastor Victoria Hanchell for giving us this brilliant idea years ago- before we were even engaged! The earlier your ceremony, the earlier your reception. You can get practically the same entrée for lunch as some venues would serve for a dinner reception- for 20-50% less. How awesome is that?!  This could literally shave THOUSANDS off your reception bill (which typically accounts for up to 50% of the total cost of your wedding day). And with a lunch reception, you can take advantage of Tip #4…

4. Skip the open bar. An open bar can account for nearly HALF the cost of your reception. Want to save some major cash? Have a lunch reception and skip the open bar. If you really want to go all out, skip the bar all together. How many of your guests are really going to be “takin’ it to the head” in the middle of the afternoon?

5. Hire a student photographer and/or videographer. What’s a great wedding day without great pictures and video to prove it? Contact the department head of your local College for Design and request referrals for student (junior or senior) photographers/videographers who may be for hire. Just make sure they come highly recommended and you view a sample of their work. Ask them for references as well. You’d be surprised how many college students would love to add you to their professional portfolio for a nominal fee (I can testify! Thanks to our videographer, Dylan Steinberg! He’s big time now- glad we snagged him when we did!).

6. Be selective with your guest list. Look, I know you want to invite your BFF from 4th grade, but you haven’t seen her… since 4th grade. Too often, couples invite everybody and their mama to their wedding, and have no clue who some of these folks are when they look through their wedding album. My friend, this doesn’t have to happen to you! Looking for ways to trim your list? Don’t invite anyone whose middle name you don’t know, or anyone you haven’t personally dined with in the past 12 months. Those two criteria alone should drastically reduce the number of guests on your list. Oh, and forgo the ex-boyfriends/girlfriends, as well anyone who is not married, engaged to, or in a significant long-term relationship with someone else on your list. The fewer mouths to feed, the more money in your wallet (and it’ll make the bouquet/garter toss much more exciting.) ;-)

7. Pair down the bridal party. Keep it simple: closest friends/family members only (2-8 people max). The fewer folks in the bridal party, the less  you have to spend on gifts, and the less you have to spend on transportation to and from the ceremony/reception. Hey, more people, more problems! Lol

8. Cut the cake. Tiered wedding cakes are rather passe nowadays. Consider an assortment of desserts (sorbets, chocolate treats, slices of cake, etc., for your guests. Still want a big fancy cake but without all the financial fuss? Opt for what I call a “styrofoam special”… a beautifully decorated styrofoam cake, where only the top tier or two is real. Have a less expensive sheet cake to be cut to served to your guests (check beforehand to make sure your venue doesn’t have a cake cutting fee. If so, ask them to waive it as a courtesy). No one will ever know the difference, trust me! (Shout out to Bredenbeck’s Bakery for making this happen so deliciously!).

9. Skip the favors. Hundred of dollars can be saved by not giving favors to your guests. No one will even miss them. Do yourself a favor- skip the favors.

10. Spend less, invest more. I know it’s tempting, but don’t spend all your money on your wedding. As beautiful as your big day will be, it will only last a few hours. Your marriage- on the other hand- will last a lifetime. Invest more in your future, less in the moment. If you haven’t done so already, check out my previous post (Financial Rules of Engagement) for smart steps towards holy financial matrimony.

Implementing these tips will reap you a wonderful wedding, while sowing more wealth in your wallet. Cheers to you!

Practically Yours,

~The Practical Chick

Financial Rules of Engagement

Dear Blissfully Betrothed,

Congratulations on your engagement!!! Now is your chance to ensure you lay a solid foundation for a lifetime of wedded bliss. Soon, you two love birds will become one- spiritually, physically, and yes- financially. Since I’m a wealth manager I have a special little gift for you: I’m going to invest some time outlining how to successfully marry your finances. It’s an area often over-looked when it comes to marriage preparation. But with more than 50% of marriages ending in divorce (sorry- I don’t mean to be grim), and financial incompatibility being one of the primary culprits for marriage dissolution, we can’t ignore the potential threats. I’m here to tell you, if you can become one financially, you can conquer anything together. You can establish the right foundation for your marriage if you adhere to these financial rules of engagement:

1. Invest in pre-marital counseling. This is the biggest investment you can make for your marriage. Retain the services of a professional, objective, disinterested, third-party- someone experienced and competent in the area of pre-marital counseling whom you both trust and respect. They’ll help facilitate a healthy dialogue between you and your intended spouse regarding various aspects of marriage. Of specific concern are your financial deal-breakers (gambling, financial affairs, and overspending, to name a few). Some insurance policies may cover a limited number of sessions (and some churches also provide counseling sessions at little to no cost to their members). Just don’t skimp on the sessions- better to spend the time and money investing in your marriage for a few months (yes, MONTHS- not just a few sessions!) than spending your time, money, and energy filing for separation/divorce later. Just sayin’ :-)

2. To tithe or not to tithe? Just because you and your intended spouse are both Christians doesn’t mean you both agree on the concept of tithing. Now is the time to start talking about your beliefs. Do you tithe off of your gross or net income? Is tithing a priority or do you put it on the back burner? Have a heart-to-heart talk about your views on tithing and what you will do if you disagree. The tithe represents just 10% of your gross income, but it can become the root of countless arguments if the two of you aren’t on the same page.

3. Should you get a pre-nup? This is an awfully touchy issue. Merriam-Webster defines a prenuptial agreement as “an agreement made by a couple before they marry concerning the ownership of their respective assets should the marriage fail.”  While I’d like to think that no one goes into a marriage expecting it to fail, I know that some folks want to protect themselves just in case. I’m not going to tell you what to do in this instance. All I’ll say is that if you’re concerned about being taken for “half” if your marriage doesn’t last, you need to address your concern with your fiancée/fiance. And definitely bring that up in counseling!

4. Save more for your marriage than for your wedding. Ladies, I know some of you have been planning your dream wedding since your were like 4 years old, but let’s be realistic about it. Your wedding day will only last a few hours. Your marriage is supposed to last a lifetime. Spending your entire savings for a few hours of fantasy- well, that’s just foolish (and you’re too fabulous to be foolish!).

5. Discuss your credit scores and credit history. Obtain your credit report and score from all three credit reporting agencies: Equifax, Experian, and TransUnion (you should do this at least once per year anyway). Now, swap reports! These reports will shed a lot of light about how your loved one handles their money. Are they drowning in debt? Have no credit history at all? Chronically pay bills late? These are all arguments waiting to happen if they aren’t dealt with from the door. And knowing one another’s credit scores will prepare you for making future purchases. The higher the score, the lower your interest rates. This means more money in your pocket. Check out www.privacyguard.com for your comprehensive credit report and scores (there is a fee for their service). Oh, and whatever you do, don’t go co-signing loans or going into debt for one another. No need in both of you being held responsible if one of you makes a bad financial decision while you’re engaged!

6. Discuss your spending habits. If you’re like most couples, you probably discovered by now that opposites attract. Chances are, your spending habits are at the opposite end of the spectrum as well. One person is a spender and the other a saver. Be open about who you are, what you like to spend your money on, and how you view saving for the future. Be sure to discuss your views and experiences during your counseling sessions. How you reconcile your conflicts is a major indicator of the strength of your union. [SIDE NOTE: Don't be caught up on how much money your significant other makes. How someone handles their money is far more important than how much money they handle].

7. Draft your team goals. You and your spouse will be a team. What goals do you want to accomplish together (buying first home, building your cash reserves, planning for retirement, having children, paying off debt, etc.)? What role will each of you play in advancing your team (who balances the check book, who pays the bills, who stays home with the kids, etc.)?  And please, please, please, discuss whether or not you will be merging your incomes together. Some couples like to keep things separate, but I’ve found that the most financially successful couples merge everything together (it limits the likelihood of financial affairs). This may be difficult initially, but the long-term results far outweigh the short-term discomfort. When you operate as a team, you can win as a team.

8. Work with a professional. Consider hiring a comprehensive financial advisor (someone who takes a look at your entire financial picture, not just your investments and/or insurance) to help you each get your individual finances in order during your engagement period. Once you’re married, you will implement your plan together. Working with a competent professional will significantly increase your ability to reach your financial goals. And you’ll be less likely to make mistakes in the process.

9. Devise a plan to live off one income. Yes, you read that correctly… ONE income! In these tumultuous economic times of high unemployment rates, rising health care costs, and reduced employer benefits, chances are at least one of you will be unemployed (possibly more than once) for an extended period of time during your marriage. I’m not suggesting that you live within a cloud of gloom and doom. I am suggesting, however, that you learn to live well below your means. There is no financial peace living paycheck to paycheck. Live on one income, and save and invest the rest. When times get hard, you’ll have access to a storehouse of savings. And you’ll be able to live quite comfortably in the meantime. Now is a good time to start working towards this goal. Begin to reduce your spending/expenses now so you will each be in a better position when you’re married. Take baby steps. You’ll be walking confidently before you know it!

10. Schedule weekly money dates. Money is an emotionally charged topic. Each partner brings to the table his/her own set of experiences, values, and fears regarding money. That’s normal. You can create a high level of financial intimacy with your intended spouse by scheduling weekly dates to talk about your finances (same day, every week, for a pre-determined amount of time). Again, this may be challenging at first. So, take baby steps. Start with a 10 minute conversation and build on that each week/each month. Work your way up to having a 30 minute conversation on a weekly basis (continue doing this throughout your marriage). Talk about your fears, your progress towards reaching your goals, any challenges you face, your monthly budget, and anything else that your partner should know. Financial intimacy requires vulnerability. The more you can become “naked and unashamed” with your finances, the more your partner will delight in covering your flaws.

Remember, the two of you are striving to become one. Now is a great time to start laying a solid foundation in preparation for a successful financial future together. GO TEAM GO!!!

Practically Yours,

~The Practical Chick