Wedding Expenses: Read this before you borrow
How much does wedding expenses cost? It all depends on your location and the budget you set for yourself. Wedding is one of the important celebrations that one will have in his/her life time. For this reason, many people like to make the event a “wow” type. While there may be nothing wrong with that if you have the resources, it is equally important that you plan your wedding to suit your budget. That is, you need to peg your wedding expenses to the level that you won’t need to break a bank.
How to Cut Wedding Expenses
In my previous article, I cited wedding as one the bad reasons for getting a loan. You don’t need to go into debt just because you want to pay for wedding expenses. I was going through the list of wedding expenses on Premier Weddings, I realize that with adequate cost control measure in place, you can make a huge savings on your wedding costs. No matter what anyone tells you, it really is possible to have a perfect wedding on whatever budget you have. Sit down with your partner and figure out how much money you are ready, willing, and comfortable spending on your wedding. Just to give you some fair ideas on how you can cut your wedding expenses considerably, you may try to avoid Saturdays. Wedding reception is usually very expensive on Saturdays. If you choose different day of the week, you may be able to save between 25 to 30 per cent on the venue costs. Also, if you have your wedding ceremony and reception at the same place, you may also succeed in cutting your wedding expenses by another 40 to 50 per cent. You just need to get creative about your wedding budget. Another area you can look at when trying to cut your wedding expenses is the bride wedding gown. A lot of couples spend too much on wedding dress. Actually the bride may sow the kind of dress that she can wear after the wedding. But unfortunately, after the wedding, there may be a change in her physique that may make the dress to be too tight for her afterward. For this reason, bride can consider hiring a wedding dress instead of sowing her own. You may even choose to invite fewer people to your wedding. Just shaving few people off your guest list can save you on wedding costs.
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Nevertheless, if you still like to buy few things on credit, I will therefore like to make the following suggestion.
Pay for your wedding expenses with your credit card: When you are preparing for your wedding, you are going to make huge purchases within a short period. If you use your credit card, you can qualify for discount or rewards on purchases especially if you have rewards credit card. The use of credit card can help you bridge some liquidity gap. Interestingly, if you are able to pay off your card balance at the end of the month, you will not be charged interest on your purchases.
Alternatively, if you know that you will not be able to pay off your card balance at the end of the month, it may be better to use credit card offering 0% apr promotional rate. 0 apr credit cards can offer between 12 and 21 months 0% apr promotional rate. What this means is that, you will not be charged interest on your purchases within the promo period. However, you will need to ensure that your pay off your entire card balance before the expiration of the 0% apr promotional rate. If you are unable to pay the entire balance before the promo ends, the interest rate you will be asked to pay may be very high. Therefore, before you opt for 0 apr credit card, you need to ascertain that you will be able to pay off the card balance before 0% apr promotional rate expires.
Credit card is not without its drawbacks. If you charge too much of your wedding expenses to your credit card, it may lead to high credit utilization ratio. For the purpose of maintaining good credit, your high credit utilization ratio is expected to be under thirty per cent. Also, new credit will reduce the average age of your credit. These can lower your credit score. Also, if your credit card debt is high, you will be paying too much interest expenses. The interest rates on credit card are very high. Consequently, your debt to income ratio may become too high. With high debt to income ratio, your mortgage may not be approved if you apply.
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If you consider the credit card drawbacks discussed above, you may then decide to take personal loan. The interest rate on personal loan is lower. Also, you can easily spread the repayment over a long time. Because the monthly payment is fixed, you already know what you expect to pay at the end of every month. This will help your budgeting.