Are Couples Really Taking Out Wedding Loans?
I do my best to stay on top of event and wedding trends no matter how good or bad they are. James, a past wedding client of mine, sent me an eye-opening article about wedding loans.
Yes you read that right, wedding loans. Companies are providing loans to couples in order for them to pay for their upcoming wedding. If you follow me on Facebook you will hear me talk about paying for the wedding you can afford now and not the one you think you’ll afford later.
Let me decode the article titled “Young Americans are racking up debt for Instagrammable weddings”.
How Much Are Couples Able to Get A Wedding Loan For?
Based on the article couples can take out up to five-figures for a wedding loan. The interest rate up to 30% of the loan. INSANE! Now let’s be clear, this is more than likely gaining traction because Yahoo Finance and others are now titling the loan a wedding loan. This is no different from a personal loan. However, personal loans are for consolidating bills, debt, and unforeseen emergencies.
Greed is showing its ugly face through companies like Prosper, Upstart and Earnest who are leading the effort to provide these wedding loans. They have issues up to four times as many wedding loans than ever.
Some might say, well it is their call to take out a loan and pay it back. If people were paying back loans, I would have no problem. However, red flags emerge as Americans' debt load hits another record.
Why Are American Couples Taking out Loans to Pay for Weddings?
In my humble opinion, Social Media is the driving force behind this. No one would really care that you had 1 million roses hanging over your dance floor if it wasn’t posted on social media. Who would care that you had a 7-foot wedding cake, real or not? Would you really inspire to have Hilary Clinton, Beyonce, and other celebrities attend your wedding if you didn’t know it was possible?
Seeing these things online will continue to drive up the demand for more elaborate weddings, which require a higher national wedding average.
It also doesn’t help when couples do not know what things costs and believe that what number they throw out is in fact the amount they should pay. Example having 500 guests, but only wanting to pay a Planner $2000 for planning.
One thing I disagree with is the wedding tax that the article mentions. Wedding Professionals do not charge more for the simple fact that you are having a wedding. There is no reason to lie about not having a wedding when you are.
Weddings require far more time from a professional than most standard events. For the wedding day alone, we Wedding Planners are working almost an entire day. Here’s a quick break down:
Monitoring hair and makeup prep – 3-6 hours
Setting up the ceremony space 2-3 hours
Setting up reception space 2-4 hours
Managing ceremony and reception run of show 10-14 hours
Breakdown of ceremony and reception 2-4 hours
These are basic numbers for standard weddings. Add multi-day Indian weddings. Add elaborate installations. Add anything else and that means adding more hours, which means a higher price point.
What Are Celebrity Weddings and High Dollar Weddings Not Telling You?
Not all celebrities pay for their weddings. Shocker? Not for me. Those with magazine or TV show deals have their weddings paid through those outlets.
For those who don’t get those deals, they get sponsorship in other areas. Ultimately what you need to know is, the beautiful wedding you are so in love with, is financed by someone other than the couple or their parents.
I know that there is a huge influence on how weddings and events look. Trust me I love an over-the-top looking wedding. However, the entire point of having a wedding is to display your love for your fiancé and to provide a personalized experience to your guests.
Often couples believe spending hundreds of thousands of dollars will satisfy both of the goals I’ve stated. That isn’t always the case.
Another key factor that you should keep in mind is what your life will be after your wedding ends. If you are ok taking out a wedding loan and know that your lifestyle will remain the same, then go for it. However, if you are struggling to pay off student debt and other loans, is taking out another loan the best decision?
Do you agree with this blog post? I would love to get your feedback by commenting below.