5 Things to Consider Before Buying an Engagement Ring
So you’ve found “the one” and are preparing to pop the question. Congratulations! Before you get down on one knee and open the Veuve Clicquot, you’ll probably need to buy a ring.
A 2020 study from The Knot found that the national average cost of an engagement ring is $5,500. If the thought of buying a piece of jewelry that expensive is causing you to gulp and sweat profusely, don’t panic. You may not have the money on hand to buy a ring in cash today, but you can finance it or put money aside through strategies like the debt snowball method to buy it outright later. Here are a few different ways to finance an engagement ring and things to consider before buying an engagement ring.
If you’re looking to finance an engagement ring, there are 3 ways to do so:
- Jewelry store financing: Many jewelry stores offer financing options or their own branded credit cards. Note that many offer promotional APR rates, but these rates expire after a designated amount of time, after which you’ll have to pay the regular APR rate, which can be exorbitant.
- Personal loans: Depending on your credit history, you might be able to get approved for a personal loan. Three- or five-year loans can give you time to pay off your betrothed’s new ice, bling, frost, etc. However, if you don’t have good credit, you should steer clear because subprime personal loan APRs can be very high.
- Credit card: If you can qualify for a 0% APR card with rewards, this can be one of the best ways to finance a ring since you won’t pay interest during the promotional period—and you’ll earn perks. Plus, many cards offer extra sign-up bonus rewards if you spend a certain amount within the first three months of opening your card.
Here are 3 things you should definitely look into before you sign on the dotted line:
1. Read the fine print
Be sure to read the fine print before you take advantage of promotional APR offers. If you don’t pay off the ring before the promotion is over, you could be stuck paying an extremely high interest rate on your remaining balance. Make sure you understand exactly how long the promotional period is and conditions under which the promo could be revoked.
You should also be extremely wary of deferred interest offers. This means that if you don’t pay off the ring balance in a certain timeframe, you’ll owe all the interest that you accrued since you first made your purchase.
2. Check the return policy
We can’t imagine anything more cringe-worthy than you presenting the gorgeous and expensive ring you just bought to your partner and them…hating it. (Actually, them saying no would probably be worse, but we digress.) With this worst-case scenario in mind, you should check the return policy. Are you able to return the ring? How many hoops will you need to jump through to do so? How can you ship the ring back?
3. Consider other options besides financing
Financing can help you buy a stunning ring over time, but it’s not the only way you can afford one. With a little preparation, you might be able to buy one fully with cash. Here are the steps you’ll need to follow to pay for a ring in one fell swoop:
- First, get out of debt. Any existing debts you have can erase money you’re trying to save for a ring. Debt payoff strategies like the debt snowball or debt avalanche methods can help you become debt-free for good.
- Next, make a budget. Creating and sticking to a budget can help you save strategically and avoid wasting your ring fund on unnecessary purchases. To create a budget, examine your post-tax income against your monthly expenses. If you’re spending more than you’re saving, see which expenses you can cut back on.
- Then, find a side hustle. If you’ve run the numbers and see that your income could use an extra boost, consider finding a side hustle, such as driving for Uber or selling gently used goods online.
By following this guide to financing an engagement ring and knowing which considerations to keep top of mind, you’ll be well on your way to your happily ever after. Whether you go for a cubic zirconia or a 10-carat Harry Winston, we wish you luck on your ring-buying, I-do-saying future.