Planning For Future Weddings
Angie wants to know if she should put aside money for her kids' future weddings before she does Baby Step 6. Dave thinks it depends on an individual situation.
QUESTION: Angie on Twitter wants to know if she should put aside money for her kids’ future weddings before she does Baby Step 6. Dave thinks it depends on an individual situation.
ANSWER: I guess it would depend a little bit on your situation. Let’s pretend that you owe $500,000 on a home, you make $200,000 a year, and your kids are 17 years old. Your home’s not going to be paid off by the time they get married, and so you probably ought to start saving for the wedding. Let’s say the kids are two years old, you make $65,000 or $70,000 a year, and owe $150,000 on your home. You’re probably going to go ahead and do Baby Step 6 and pay off the home. You’ve got time to get that done and still save and/or cash flow the weddings when they come.
I have become further indoctrinated—further into expertise other than just vague research from having read some Googled article—as I have lived. I’ve been on the air for 20 years, and so when we started, our children were small. My youngest daughter is married, and my oldest daughter is getting married this summer, so I’m on my second wedding. It’s not my first trip on this cabbage truck. It’s funny that you have a lot of opinions about things and think you know what’s going to happen until you get there. I found parts of this wedding thing to be much easier than I thought they would be. That has to do with how my daughters were raised and the relationship that my wife and I have. I found other parts to be harder than I thought they would be. I spent more on weddings than I thought I would. If you had asked me back when I made X if I would spend what I’m spending on a wedding now many years later, I would have said, “That’s crazy! Nobody should ever do that!”
There are always two things that come up: the budget for the wedding and the price of the ring. Generally speaking, young men, the ring should not be more than one month of your pay. Never buy rings at the retail jewelry store at the mall. Retail diamonds have more markup than any other retail item except possibly furniture. Both of those categories are basically double wholesale. You need to learn to buy from a diamond broker and/or a high-end pawn shop. Get a friend of the family who knows a little bit about diamonds to go with you and help you understand what you’re purchasing or really know your diamond broker very well personally. Diamonds are an absolutely horrid investment. They do not go up in value. They are an investment in the relationship, and there is no correlation between the size of the rock and the length of the marriage. If there is, it’s a negative correlation.
The average wedding, according to several articles published in wedding publications, is about $28,000. Most people—half the people—spend less than that. About half the people spend more than that. The average household income in America right now is $50,000 to $52,000. For purposes of this discussion, we could say weddings are about half the average income. Your wedding—if the mom and dad are paying for it—wouldn’t be wise to the extent that it goes beyond half of the household income. Does that mean you need to spend half? No. When you go to the extremes, these rules of measure don’t work.
We just said, “We’re willing to spend X.” I wrote a check for X. I put it in a separate checking account with my daughter and her fiancé’s names on the checking account. We had a really detailed and blunt discussion. “You’re not getting another freaking penny. That’s it. If you spend X minus $10,000, you put $10,000 in your pocket. I don’t want a refund. So if you decide to elope, you can keep the money. You’ll have to deal with your mother, but you can keep the money. We expect you to kind of have a nice wedding. That’s the idea.” We had a blast with the first one, and the second one’s well underway, getting married in June. We’re having a blast. Nobody’s stressed out or freaked out because the guidelines are very clear, and I told them to sit down and make out a wedding budget. How shocking is that?
Be intentional about it and take the drama out, and then your wedding doesn’t turn into something you wish you’d filmed for a reality show. You’re not one of those bridezillas or something. Future weddings are probably something to plan for when you start thinking it’s that big of an expenditure—potentially. How you think about that is a big part of the process.