Many are familiar with the traditional expert advice: purchase a ring worth two months of your salary. This suggestion aims to spread the ring’s cost over a period of time and to avoid a tight financial situation, but there are other variables you should consider before deciding how much you should spend on an engagement ring.
Originally proposed by De Beers Jewelers, the recommendation to select a ring worth two months of your salary has its origins in the 1950s, a time when rings tended to be priced relatively lower than they are now.
To bring this advice into the present, review your salary, budget, and monthly spending habits in order to determine how much you are realistically capable of earning within a two-month period.
The question of affordability, like a two-months’ salary, varies from person to person and is entirely subjective. Those who earn less should save for a longer period of time than two months in order to purchase a ring that is equally stylish and budget-friendly. Once you have evaluated your personal finances, you should only spend as much as your personal affordability allows.
However, what if you have your eye on a specific ring and it costs a significant amount of money—perhaps more than your personal affordability recommends?
Consider a Loan
Whether you should take out a loan is another tricky question, as each person’s financial situation varies and is specific to them.
If you have good credit and are confident in your capability to pay back the principle and interest, there is nothing wrong with requesting a small loan in order to secure the ring you want.
In the same respect, if you have poor credit or are already working to pay off an appreciable amount of debt, it may not be wise to request a loan for your ring if you will only dig a larger financial “hole” for yourself (even if your loan is approved). To purchase a ludicrously expensive engagement ring only to encounter fiscal difficulties soon after you tie the knot may take away from the joy this time in your life deserves.
Compare and Contrast
According to figures released in 2019, an average engagement ring costs approximately $5,900 dollars. If this figure is out of your personal affordability, first keep in mind that this is only a mean figure.
Spend time researching rings and scoping out the latest deals in order to get a fuller picture of your price range. If you already have a certain ring design in mind, look at the different quality of diamonds; even the smallest differences in clarity and carat weight can dramatically impact the final cost of the engagement ring in question. In addition, those who shop for diamonds through reputable suppliers can access wholesale prices, which often significantly lowers the cost of an engagement ring.