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Happily Ever After

Richard Quinn  |  February 14, 2019

I’VE DISCOVERED the solution for young people looking to save for retirement.

The typical engagement ring costs more than $6,300. Why so much? I recently learned there’s a rule that you should spend two months’ salary on an engagement ring. That means a guy earning $48,000 a year is expected to spend $8,000. Where did such a rule come from? Turns out it was started by the De Beers company. Need I say more?

Apparently, there are other rules for engagement rings, such as the tenth-of-the-value-of-your-car rule, which might be more reasonable depending on your vehicle of choice, and the diamond-based-on-your-bride’s-age rule. The latter rule suggests a 32-year-old bride gets 3.2 carats.

No, I’m not the ultimate curmudgeon. But frugal me sees spending lots of money on an engagement ring as a close second to spending tons of cash on the wedding reception. I’ve been to a very lavish wedding costing over $1 million and to one that cost just a few thousand. Neither related to the length or happiness of the marriage. Could this lavish spending reflect the fact that someone other than the bride or groom is often footing the bill?

The average American marriage that ends in divorce lasts about seven years. Maybe we need a rule that says the wedding should cost no more than $2,000 for each expected year of marriage. I’d be a loser on this one: My wife and I just celebrated our 50th anniversary.

In 1968, I purchased an engagement ring for $1,500, while I was in the army making less than $100 a month. To buy it, I sold some stock at a loss. The next time I came home on leave, I could have paid for the ring with profits from the stock I sold too soon. Market timing is not my strong point.

If you invest $6,300 not in a ring, but in the market for 30 years at an annual return of 7%, you would have the tidy sum of $47,957.21. What if you cut your spending on the reception by two-thirds and also invested that money? You’d be well on your way to a comfortable retirement.

There’s a TV show called “Say Yes to the Dress,” where brides and their entourage shop for the wedding dress. The first question asked is, “What is your budget?” The typical low-end answer is $3,000. Many are in the $8,000-and-up range. Frequently, the budget is exceeded by a few thousand for the “yes” dress. Parents are shamed into spending way above budget because “I want my little girl to be happy.” I, too, wanted my little girl to be happy—but not by spending four times the average monthly Social Security benefit on a dress to be worn for 10 hours and forgotten like last year’s Christmas present.

Hey, you can have a good, memorable time without spending lavishly or going into debt. Impressing relatives and friends is an expensive investment, with little or no return. And it strikes me that that goes not only for the marriage process, but also for a great deal of other spending. Our biggest financial problem may not be our income, but rather our spending priorities and our foolish attempts to impress others.

Richard Quinn blogs at QuinnsCommentary.com. Before retiring in 2010, Dick was a compensation and benefits executive. His previous articles include The OfficeStill Learning and Healthy Change. Follow Dick on Twitter @QuinnsComments.

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