Obviously, you want your Big Day to be memorable — the best celebration of your life. But you really, really don’t want to be left with a financial headache for months or years after. So it’s worth discovering how to pay for a wedding dress painlessly.
Wedding dress loans without headaches
Plenty of people will tell you the only wedding dress you can afford is one you pay cash for. They’re trying to be helpful and are genuinely looking out for you. But they may be out of touch with the real lives of many modern couples.
Of course, if you have enough savings — or have time to save enough — that’s ideal. But most wedding dress providers want deposits upfront, and you may not have that much in your wallet right now. In that case, you need wedding dress financing you can comfortably afford. And that affordability must be in the context of any other borrowing you need to pay for your wedding.
Set a goal
Before you start shopping for anything wedding-related, create a budget and know how to pay for a wedding dress. Wedding financing may be part of this plan if you don’t have all the cash you need. Ideally, you borrow now in order to pay the deposits needed to start the process, and pay off the loan in monthly installments before your wedding.
Be realistic about this. There’s no point kidding yourself that you’ll have paid everything in six or nine months if the only way you can do that is to skip meals or win the lottery. It won’t be long before you see an overall budget emerging: If I’m going to pay back $y every month for x months, I can afford to borrow $z.
Set a wedding dress budget
So now you know your total budget for the wedding: what you can affordably borrow, plus any savings you can spare and contributions from family and friends. Resolve to stick to it!
How much should you spend on a wedding dress? It depends. The average wedding dress in the US costs about $1,600. But you can pay a lot more — or a lot less, if you’re creative.
Where does your dress sit in your personal hierarchy of wedding needs? Will you pay for the best, even if that means scaling back other items on your budget: the venue, catering or bar? Or would you prefer to economize on the dress and spoil your guests?
Such tough choices are at the heart of good budgeting. And, if you’re already thinking you could borrow a bit more and stretch the payments over more time, you could be heading for that long, long hangover.
How to finance a wedding dress
It’s up to you whether you take one big loan to cover the whole wedding or a number of smaller ones for each major expense. Either way, the type of finance you choose can make a big difference in how affordable your borrowing will be.
This is a situation where “playing your cards right” applies literally. If you have the time to apply for a new card and manage debt well, you can actually make money on the deal. But get this wrong and the outcome could be very costly.
Of course, if your existing plastic has valuable rewards programs, you can continue to charge purchases to it. But don’t carry balances. The interest you pay is likely to be roughly double what you can easily access elsewhere.
What you want is a new card that has an introductory offer of 0% APR for a limited period. Use that for purchases or use your rewards cards and transfer the balances. Just make sure your balance is zero by the time the introductory period ends. And don’t apply for multiple new cards in quick succession. That’s going to raise red flags for lenders and harm your credit score.
Credit score risk
The biggest potential harm to your score is posed by using too much of your available credit. With cards (but not with installment financing like personal loans), adding to your balances causes your credit score to dip.
So don’t think your shiny new card with a $5,000 limit is going to give you $5,000 of spending power. It’s closer to $1,500 if you want to protect your credit score. Lowering your score can cost you in the future, so avoid doing so when possible.
You face no such issues with personal loans. The amount you borrow is the amount you can spend. Providing you make timely payments, the only hit your score takes is a tiny one when you apply. And that occurs with applications for all sorts of credit, including cards.
Personal loans have other advantages, especially if you’re not one of nature’s more gifted money managers. To start with, they’re highly predictable. Choose a fixed loan and make equal monthly payments over the loan’s term.
So you never get to say, “Oh, I’ll just pay the minimum this month,” as you can with plastic. You know from day one when you’ll be free of the debt. And you can’t be tempted to stretch that out.
Better yet, personal loans are typically cheaper than standard credit cards. Average personal loan interest rates are about 7 percent lower than average credit card interest rates, and they are usually fixed.
And, of course, you can still earn the same card rewards by charging purchases to your existing plastic. Just zero the balance with the proceeds of your personal loan.
Finance wedding dress costs
Most personal finance experts don’t recommend financing a short-term item (and a dress that you will wear just once certainly qualifies!) with a long-term loan. So choose a dress you can afford and finance it over the shortest term you can manage.
None of the above financing options should cramp your style on your wedding day. But they may prevent you from starting married life with massive financial headaches.