Is getting a wedding loan a good idea?

You and the love of your life have decided to make things official and your wedding preparations are going according to plan. But there’s just one hitch before you get hitched: You don’t have enough cash to pay for your big day. Should you take out a wedding loan?

Let’s ask some financial experts.

What is a wedding loan?

The average cost of a wedding in 2021 was $28,000, according to The Knot. And some couples’ plans for their wedding day may not match the budget they have set aside. Wedding loans are options for couples who are willing to borrow for their wedding day.

Wedding loans are unsecured loans offered by banks, credit unions, and online lenders. Interest rates range from 5.99% to 24.99% and loan terms range from 24 to 84 months.

What will a wedding loan actually cost you?

Your visions of satin and monograms aside, using a wedding loan to fund your dream day doesn’t make good financial sense, according to Elliott Appel, a financial planner and founder of Kindness Financial Planning based in Madison, Wisconsin. “In a way, it's taking a few steps backward financially before even getting married,” he says.

He gave this example of the costs. “If you took out a $30,000 wedding loan with a repayment length of 60 months, your estimated payment might be $580 to $623 a month, assuming a 5.99 to 8.99% APR... It's hard to imagine that paying $500 or more per month for five years is worth one day,” Appel says.

And a wedding loan may have an interest rate beyond that 5.99% and 8.99% range. “Based on my research, I see APRs between 5.99% and 24.99%,” Appel says. “A wedding loan can get very expensive very quickly.

How can you decide how much to spend on your wedding?

Before considering a wedding loan, couples should reconsider their budgets, advises Melinda Opperman, president of Credit.org, a non-profit organization offering financial education and debt relief options.

“Every individual’s situation is unique, and you might be absolutely, positively sure a wedding loan is a good idea, but just like in all the other spending in your budget, every purchase made with credit should be planned and budgeted for,” Opperman says. “If you are considering a wedding loan, the first decision is determining whether you can comfortably afford the monthly payment.”

If the ongoing repayment will present ongoing financial strain, a wedding loan may not be the right way to pay for your wedding. Rather than a loan, Opperman suggests cutting down on wedding expenses.

“You may want to consider sticking to a lower wedding budget,” Opperman says. “This can be accomplished by changing the day of the week you’re getting married, choosing to hold the wedding ceremony and reception at a budget-friendly venue, reducing the guest list, and holding your reception during the day with hors d’oeuvres instead of at night with dinner.”

What if you and your partner have different ideas of how much to spend?

A wedding is a big expense for many couples and the planning of it is an opportunity to learn about each other’s financial attitudes and beliefs.

“Planning for a wedding is a great icebreaker to discover how you will approach other financial challenges and goals, so make sure each partner is an active participant in expressing what their must-haves, and like-to-haves, are for the special day,” says Samuel Lewis, founder of SJL Financial in Wilmington, Delaware. “This is a great exercise to discuss compromise and sacrifice.”

Above all, couples need to be honest about their finances before planning a big wedding.“You should get all of your finances on the table before committing to big spending on the main event,” Lewis says. “If your current income and savings are necessitating a loan to make your dreams a reality, you should be clear-eyed about the trade-offs you'll have to make in other areas to pay off the loan, long after the vows and toasts are over.”

Rather than borrow for their wedding, Lewis and his bride-to-be looked at how much of their savings they could commit to their wedding at the outset of planning and how much they could contribute each month in the months leading up to their wedding. Added all together and this would be the cost of their wedding. He urges other couples to do the same. “Coming out of the wedding debt-free will give you tremendous peace of mind,” Lewis says.

Don’t forget your wedding is more important than the money you have to spend. “The most important part of the day is your commitment to each other and the love you share,” Lewis says. “Don't get too caught up in overspending that requires a loan for a single day out of what you hope to be a lifetime together!”

When would a wedding loan be a good idea?

Time-pressed couples might turn to wedding loans to finance their nuptials, according to Brittany Wolff, a certified financial planner at Wolff Financial in Greenville, South Carolina.

“If you don’t have time to save up for a wedding, you might need a loan,” Wolff says. She advises couples to take a close look at their wedding expenses. “First, evaluate your wedding expenses and determine what are your must-haves. There will be things that you can cut back on,” Wolff says.

Couples also will want to examine the terms of a wedding loan. “When looking at getting a loan you need to consider the following: interest rate, capability to pay it back and impact on your credit score,” Wolff says. “If you are looking to buy a home shortly after getting married, the hit on your credit can impact your mortgage rate.”

What are the alternatives to a wedding loan?

If you must borrow to fund your wedding, you may be better off with a personal loan from your bank. If approved, you can expect lower interest rates than those typically provided by wedding loan purveyors. As with any loan, aim to borrow the minimum amount needed.

Another option could be to use a no- or low-interest credit card. If you go this route, you’ll want to pay far more than the minimum payment and work to pay off the balance as quickly as you can. If you have a card with a 0% introductory rate on purchases, like the Chase Freedom Flex, our top no-annual fee credit card pick, you’ll have up to 15 months to pay the amount in full before the introductory period ends. That way, you will pay no interest on the credit card charges for your wedding.

What if a wedding loan is your only option?

If a couple is set on getting a wedding loan, Appel urges them to think small. “If someone absolutely wanted a wedding loan, I wouldn't take out a wedding loan that you couldn't pay off within a year,” Appel says. “Debt is borrowing from your future. Debt for education, a home, and other experiences that can enhance your earning capability can be an investment, but debt for a wedding feels like selling a part of your future for one day together.”

Trim the costs of your wedding enough and you may not require a wedding loan for your big day. “Weddings don't need to be an elaborate party with all of your friends, family, and acquaintances. They can be intimate, simple ceremonies,” Appel says. “It may require making some sacrifices and not getting all the elements one wants, but that's a small price to pay compared to the debt one might feel burdened by at the start of their marriage with a wedding loan.”

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