2 Reasons Why Borrowing Money for Your Wedding Is Absolutely Not Worth It

While I am happily unmarried these days, I've been down the bridal path twice before, and had two extremely small and cheap weddings (and the second time, eloped in Las Vegas at a cost of less than $500). That said, I'm not here to judge or vilify anyone for wanting a big blowout party complete with a hundred guests, posh favors, and a big fancy venue. According to The Knot, in 2022, couples spent $30,000 on average for their weddings -- that is a significant amount of money.

The trick is figuring out how to pay for it, if it's what you want. And this is where you might run into trouble. A personal loan might seem to be a natural choice if you need to borrow money to cover wedding costs, but you should think twice before going that route. Here's why.

1. The wedding is one day

Okay, if you have a big wedding weekend, you might stretch the festivities over a few days. But either way, a wedding is a short-term financial commitment. Does it really make sense to spend so much money in one fell swoop? Remember, you'll pay interest on the money you borrow.

Just as it's not a good idea to borrow money for a vacation or anything else that will not tangibly improve your life in the long term, borrowing for a wedding isn't worth it. What kinds of costs are worth borrowing for? How about a mortgage loan to buy a home? Or a business loan to make your small business dreams a reality? Even borrowing money to buy a car can markedly improve your life, giving you the ability to get to work and school in a more efficient manner than relying on public transportation.

Yes, you'll pay interest when you borrow money for any of these purchases -- but the current 7.18% average mortgage rate for a 30-year loan (per Freddie Mac) is a little easier to swallow when you consider that you're buying a stable place to live and an asset to build equity in.

2. You're starting off married life with additional financial stress

Marriage is hard enough without adding more (and voluntary) money stress. A 2021 study from Fidelity found that 1 in 5 couples rate money as the greatest challenge in their relationship. And it makes a lot of sense -- when you marry someone, you're agreeing to wed your finances too, in at least a few ways. Making a long-term commitment to another person means you'll likely have big financial goals as a couple. Maybe you want to own a home, or retire early, or if you have kids, cover their college costs.

These are wonderful goals, but the nature of life is such that you'll likely end up with big unexpected and emergency expenses to pay for, too. It's a much wiser move to save and plan for the big goals, and also build some savings in for the unexpected (in the form of an emergency fund). Owing money on a loan can make that difficult.

If you finance a $30,000 wedding over five years at an interest rate of 11.31% (the average rate on a personal loan as of this writing, per Bankrate), you'll pay $657 a month, and when all is said and done, you'll have paid over $9,400 in interest. That's a lot of money, and it could do a lot of good for you -- the interest alone might make a pretty solid emergency fund, for example. And if you end up unable to make those payments, the resulting credit score damage could also add a lot of stress to your finances, and to your marriage.

How should you pay for a wedding?

I absolutely get that not everyone wants to elope in Vegas on the cheap. You might want to celebrate with friends and family and wear a sweet tuxedo or gorgeous gown. How can you make that happen without taking on a lot of debt?

• Think smaller: Do you need to have every person you know at your wedding? Perhaps not. Scale back your celebration, and consider having a small wedding for the most important people in your life, and plan an inexpensive backyard barbecue at a later date and invite everyone else to celebrate with you.
• Decide what's most important: If you want the $5,000 dress, can you cut back on your favors or your venue? Get married outdoors for free, serve hors d'oeuvres instead of a sit-down dinner, or hire a DJ instead of a live band.
• Take advantage of another way to finance: A credit card with a 0% APR period might be a better way to finance some of your costs (if you can pay the card off in the time you're allotted, which could be a year or longer). And some wedding vendors might be able to set up a payment plan for you.

It's normal to want a special wedding day, and you're not alone. But think twice before you borrow a heap of money to blow on a single day's expenses.