For Richer or Poorer Starts When Planning the Wedding
By Laura Taylor
With wedding season fast approaching, many couples can already hear the wedding bells. Unfortunately for some couples, the bells may sound more like the clanging cha-ching of a cash register, as wedding costs continue to skyrocket. The total cost for weddings nationally in 2006 was $59 billion, with the average wedding costing $26,800, a 4 percent increase from 2005, according to www.theweddingreport.com, the wedding statistics and market research Web site for the wedding industry. So far, in 2007, the average has been $27,490. In the Washington metropolitan area, the average wedding is about $40,980, according to www.costofwedding.com, a wedding planning site for brides and grooms listed by city.
Traditionally, the bride’s parents are responsible for financing the walk down the isle and the reception. However, with couples waiting longer to tie the knot, the increasing trend is for both the bride and groom to finance their own celebration. With this in mind, before saying “I Do,” consider a few smart money tips offered by the experts at Consumer Credit Counseling Service, a division of Money Management International.
- Know your budget. Creating a realistic budget is probably the most important piece of planning a wedding, and should definitely be the first step. Determine what kind of celebration is important to you, consider what you can afford, and then decide who pays for what. According to CNN Money, 73 percent of all wedding ceremonies are a combined financial effort between families—the more contributors, the bigger the wedding.
- Start planning early. The average wedding takes 16 months to plan. You will need hundreds of hours to visit vendors, set appointments, and chase after details. Allowing a full 12 to 16 months will allow time for possible re-dos, offers the most opportunity to take advantage of bargains, and allows all parties time to add to their wedding savings fund.
- Join a wedding site. Sites like www.theknot.com help you stay organized and on track. Gain access to helpful articles and popular links as well as special offers. These sites also include tools like online calculators and interactive personal settings to help you maintain a structured budget and to do list.
- Go against the grain. According to Hallmark, most weddings are held during the summer months, with August being the most popular. Consider having an off-season wedding during the less popular months. Review facility pricing for a morning or early afternoon wedding, as opposed to an evening wedding. You can usually get reduced pricing with facilities and vendors during those times.
Finally, regardless of whether you are hoping for an extravagant wedding or a simple ceremony, your special day should be filled with blissful memories. Being financially prepared will help make sure this day is one of the most memorable days of your life. It is important not to forget that while the wedding is an important event, its purpose is to celebrate the start of a marriage. Practicing healthy financial decisions early will lead to a lifetime of financial freedom and happiness together.
Laura Taylor is the director of education and community relations at Consumer Credit Counseling Service of Greater Washington Inc., a division of Money Management International. Visit its website at http://www.crediteducation.org.
Everyone Needs a Budget
By Andres Izaguirre
A monthly budget is an income and spending plan. A budget is a financial tool, which helps you spend less than you earn on a monthly basis. You seldom see a person in financial difficulty who maintains a budget. We must use self-discipline to control spending and keep needs, wants and desires in their proper perspective. However, you can incorporate all of them into your monthly budget.
Listed below is a Guideline Budget from the biblical principles financial advisor Larry Burkett’s book, The Family Financial Workbook: A Practical Guide to Budgeting, so you can compare your spending habits to other people with a similar income level. A guideline budget is a family spending plan expressed in percentages to keep the proper balance in each category of the budget. The guideline budget serves as a standard to compare your present spending patterns. The comparison also helps you to identify the areas of overspending that are creating the greatest problems and where adjustments need to be made. Specially, if you are overspending, the percentage guideline may be used as a goal for budgeting.
GUIDELINE BUDGET FOR A FAMILY EARNING $85,000 PER YEAR
- Housing (mortgage, insurance, taxes, utilities and phone): 30%
- Food: 10%
- Automobile (payment, gas/oil, insurance, license/taxes, and repairs): 10%
- Insurance (life, health, and other): 5%
- Debts (credit cards, loans, and notes): 5%
- Entertainment (restaurants, cable TV, activities/trips, and vacation): 7%
- Clothing: 7%
- Savings: 5%
- Medical/dental (physician, dentist, medicines, and other): 4%
- Miscellaneous (toiletries, hair cut, dry cleaning, gifts, and subscriptions): 5%
- Investments: 7%
- School/child care (tuition, materials, transportation, and day care): 5%
After comparing your monthly budget with the Guideline Budget, decisions must be made about overspending. Perhaps you may have to consider a change in housing, automobile, insurance, private schools, or other categories. It may be possible to reduce some areas to compensate for overspending in others. Don’t worry if your new budget is different from these guidelines. However, it is crucial that your new budget does not exceed your Monthly Net Spendable Income.
If you have a surplus in a particular month, you may transfer that amount to your savings account. Perhaps in another month when you may have a deficit, you can transfer back a certain amount to your checking account to balance your budget.
Remember that if you want your budget to work, you will have to discipline yourself and review your expenses every month, to make sure that you are meeting all of your family needs, as well as to accomplish your own financial goals of savings and investments.
Andres Izaguirre is a fraud investigator in DISB’s Enforcement and Investigation Bureau.
Disclaimer: The information or views presented in this column are those of the authors and do not reflect the views of DISB or the Commissioner.