How Wedding Loans Work

newlyweds leaving their wedding
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Everybody wants their wedding day to be a fun and memorable occasion marking the beginning of something great. A nice setting and good food go a long way toward setting the mood, and you might want to share the occasion with your network of friends and family.

For many people, that also means that weddings are expensive. What if you don’t have the funds to throw the party that you want? Does it make sense to get a loan for wedding expenses? People certainly do borrow for weddings, but it’s a risky move, and you’ll want to get educated before going down that path.

Should You Use a Wedding Loan?

It would be irresponsible to discuss your options without first offering this advice: Please don’t take on debt to pay for your wedding. You want to start off on the right foot with your new spouse, and starting out in debt will not help. Studies often show that financial issues are common (if not the most common) driver of stress in relationships. Why put yourself or your spouse in a difficult position?

Wouldn’t it be nicer to start your marriage by building your future together (as opposed to playing catch-up)? You could save for a home, or—if kids are in the picture—for your child’s education. Plus you need to plan and save for your golden years together. Even if the monthly payment on a wedding loan seems reasonable, those payments would go a lot farther if you let them compound in a retirement account for a few decades. If you don’t have the money now, how will things be different the day after your wedding?

If You Decide to Borrow

If you simply must get a loan for your wedding, borrow wisely. Most loans, especially if they are marketed as wedding-specific deals, are simply personal loans. That means you will not pledge collateral—your credit scores and your income are the factors that determine whether or not you’ll get the loan. Before applying, check your credit and fix any errors or negative items that will prevent you from getting the best deal.

It might be necessary to join forces. If you can’t qualify for a loan on your own (because you have thin or bad credit or insufficient income to qualify), your future spouse might need to co-sign for the loan. That means both of you are equally responsible for repayment—which is a good or a bad idea depending on how you look at it (equal responsibility means you’re equal partners, but if something goes wrong, both of you will end up with bad credit). For the best terms, look for loans with the following characteristics:

Where to Borrow

For the best rates, get a personal loan from a bank, credit union, or online lender. Peer to peer lenders might also be an option—they offer relatively short-term loans at competitive rates. If you can’t pay the loan off within a few years, it might be best to re-think.

Credit cards are risky for funding your wedding. Sure, they’re easy to use, but things can get out of control easily. If you have great credit and (more importantly) a plan to pay off your loan within six months or a year, you could use a 0% interest convenience check. But if you don’t pay the loan off quickly you’ll almost certainly find yourself in over your head.

A Few Alternatives

Since we’ve already spoiled the romantic mood, here are a few alternatives to getting a loan for your wedding. If you don’t have enough money for your dream wedding, something’s got to give, whether it’s now or later.

  • Budget and save: unless you’re getting married next month, you have some time to plan and set money aside. Pay for what you can yourself—developing this habit will serve you well in all your years together. Start building your life together even before you get married.
  • Family and friends: some people would be mortified to ask friends and family to help out with a wedding. If you’re not one of them, think of creative ways to get help. On one extreme, you can simply ask for cash and crowdfund the wedding. Alternatively, your friends and family could offer their time, skills, and other resources: maybe somebody has a beautiful property for the big day, somebody else is an amazing chef (with the ability to serve numerous people), and you also happen to know a great photographer (who won’t “forget” to take photos as the night progresses). Your loved ones want nothing more than to help you set off on a happy life together.
  • Defer costs: maybe you can hold off on buying that expensive ring. Start with something you can afford now, and upgrade later in life (perhaps at a significant anniversary, or whenever your financial situation allows).
  • Cut back: you might need to make difficult decisions about your wedding day. Can you invite fewer people, or make the event more modest? Maybe an open bar is not in the cards. Your guests will remember the general feeling of the day more than the specifics (and again, your future happiness is the most important thing).