Published in: Banks | April 29, 2019

How to Pay for an Engagement Ring Without Going Into Debt

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Engagement rings can be very expensive, but borrowing to buy one can be a very bad idea. Here’s some advice on paying for an engagement ring without going into debt. 
Man putting engagement ring on woman. Image source: Getty Images. 

When you’ve found the love of your life, it’s natural to want to make a grand gesture with a beautiful engagement ring. Societal pressure also tells you this is the right course of action, with ridiculous advice like spending several months salary on an engagement ring.

The reality is, while you want to do the best for your beloved, going into debt for an engagement ring is usually a really bad idea. After all, a ring typically isn’t an asset that will appreciate in value -- and starting your life together with a lot of debt for a ring that’s worth less than you paid for it isn’t the best idea.

The good news is, you can still do right by your future spouse without breaking out the credit cards, getting a personal loan, or otherwise financing a ring with interest. Just follow these tips for how to pay for an engagement ring without going into debt.

Make a budget

First and foremost, you’ll need to decide how much you can comfortably spend on an engagement ring without going into debt. This will guide your efforts to find the perfect ring -- and will make sure you don’t end up going overboard and buying something you can’t really afford.

To budget for your ring, consider how long you have until you want to propose and how much you can save until the big day. If you want to propose in six months and can afford to save $500 a month without compromising other vital financial goals -- like contributing to your 401(k) to earn the employer match -- then you’d be looking at $3,000 for your ring budget.

If you find that your budget is way too low to afford a ring in a reasonable time, you may need to consider taking steps like picking up some side work or selling other things to come up with the cash you need to get at least some money for a ring.

Do your research

It’s also important to know how to make your money stretch further when you’re looking for a ring -- which means you need to understand what makes certain rings more expensive than others.

Typically, the biggest factors that will determine your ring price are the metal used for the ring setting (platinum is usually most expensive), as well as the cut, color, clarity, and carat.

The cut typically makes the most impact in terms of how a diamond sparkles. Clarity relates to imperfections, and may not matter quite as much because many imperfections are hard to see with the naked eye. As for color, you want the minimal amount of color and this is second in importance to clarity in terms of how a diamond looks. Lastly, carat refers to the size of the diamond.

You’ll need to consider what is most important to your partner -- if they want a big rock, then compromising on color and clarity may be necessary to bring the ring cost within your price range.

Consider a diamond alternative

While diamonds are often considered the standard for engagement rings, they’re also a much more expensive option than many other stones. If you think your partner would be open to it, you may want to consider an alternative for a ring. You could get a much bigger and more dramatic gemstone for a lower price than you’d pay for a smaller diamond and the ring could make a statement by being different.

Opting for a different stone is typically something you’ll need to talk about with your partner, but making this decision together can be a good way to get off on the right foot with managing your finances jointly. If you want the proposal to be a surprise, you could propose with a toy ring or ring pop and let your partner know you hope to pick out the ring together.

Shop around

The more affordable the ring, the easier it is going to be to stay within budget and avoid going into debt. For this reason you should cast a wide net when shopping around for your engagement ring.

Online jewelers are one good place to look and may be cheaper than your local jewelry store. You can also check vintage stores and flea markets for antique rings. Just make sure you know what you’re buying and don’t get ripped off. An antique ring could cost far less than a brand new one and could make a unique statement since it won’t just look like another cookie-cutter diamond ring.

Work up to a bigger ring

If you want your partner to have a really amazing ring but you can’t afford to buy one now, consider deciding together if you can work up to buying the big ring.

You could purchase a really nice platinum setting and put a cubic zirconia in the setting to start with -- then save up for the diamond to buy on your first or second anniversary. Just be sure you’re honest with your partner about the plan and that you talk to your jeweler and make sure the setting can accept the real diamond when you’re ready to buy.

You don’t have to spend a fortune for the perfect engagement ring

You have plenty of options to avoid going into debt for an engagement ring. If your partner is pressuring you to spend more than you can comfortably afford, this may need to give rise to a bigger conversation about how you’ll handle money together when you’re married. After all, the ring is just a symbol -- being able to talk openly about financial goals is a key to marital success.

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