Should I get a wedding loan to pay for my big day?

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Considering a wedding loan to pay for the big day? Here’s what you need to know about interest rates, repayment terms, and alternative options. (iStock)

Planning a wedding can be exciting, but this happy day often comes with a hefty price tag.  

The average reception alone costs about $22,500 in 2021, according to data from The Knot. In some states, such as New Jersey, couples spend more than $53,000 on average on their wedding. It’s no wonder that many couples borrow money to fund the wedding of their dreams, often in the form of credit cards or loans. 

It’s best not to use a personal loan to pay for your wedding. But if you have to, make sure to shop around for the best lender and loan terms. Here’s what to know about wedding loans, as well as some tips for how to save money to avoid going into debt for your big day.

When a wedding loan makes sense

Couples should try to avoid going into marriage with new debt, if possible — especially if the bulk of that debt is incurred on a single wedding day. 

But taking out a wedding loan — which is a personal loan that’s used for wedding expenses — might make sense in some situations.

  • If you need to borrow money for your big day, a wedding loan will generally be more affordable than a high-interest credit card, and you’ll typically have a fixed monthly payment.
  • Let’s say you’ll have a more flexible budget in the near future — perhaps you’re starting a new job or finally paying off the last of those student loans. In this case, taking out a personal loan that doesn’t charge prepayment penalties may be an acceptable solution, allowing you to pay off the debt as soon as possible.
  • If you’re trying to build or improve your credit, taking out a wedding loan and repaying it on time (or ahead of schedule) may help boost your credit score. Improving your credit may help you qualify for better loan rates and terms in the future.

Taking out a wedding loan makes the most sense when you have a stable income and enough flexibility in your budget to take on the monthly payment and repay the debt in the shortest amount of time possible. 

You can use Credible to easily compare personal loan rates from various lenders.

How much money can I get with a wedding loan?

Depending on the lender you choose, your credit history, income and unique wedding day needs, you could borrow anywhere from a few hundred dollars up to $100,000. Typical loan term lengths range from one to seven years.

Some wedding loan lenders to consider

If you think that a personal loan is the right choice to cover your wedding day expenses, consider these Credible partner lenders.

Avant: Good for poor credit

With a minimum credit score requirement of just 550, Avant may be a good choice if you have a limited or poor credit history.

  • Loan amounts: $2,000 to $35,000
  • Repayment terms: Two to five years

Axos: Good for good to excellent credit

Axos offers loans with competitive rates to people in all 50 states.

  • Loan amounts: $5,000 to $35,000
  • Repayment terms: One to five years

Discover: Good for lower monthly payments

With repayment terms as long as seven years, borrowers may be able to secure lower monthly payments on their wedding loan.

  • Loan amounts: $2,500 to $35,000
  • Repayment terms: Three to seven years

LendingPoint: Good for borrowers with low income or credit scores

LendingPoint offers personal loans of up to $36,500 to borrowers in 48 states, with a minimum income requirement of just $20,000 and a near-prime (high 500s to low 600s) credit score requirement.

  • Loan amounts: $2,000 to $36,500
  • Repayment terms: Two to five years

See your personal loan rate options on Credible with no effect on your credit score.

Pros of wedding loans

Taking out a wedding loan can come with a few benefits.

  • It may have a lower interest rate than a credit card. If you must decide between paying for a wedding with credit cards or a wedding loan, the loan could come with lower interest rates.
  • Loan funding can be quick. Most personal loans take around five business days to fund, but you could get access to cash as soon as the same or next business day once approved, depending on the lender.
  • Couples can build credit. With an installment product such as a wedding loan, couples can build (or establish) a payment history and even boost their individual credit scores.

Cons of wedding loans

Wedding loans also have some drawbacks you’ll want to consider.

  • It’ll cost you. Personal loan lenders charge interest on the borrowed amount. Depending on your credit, this can cost you quite a bit. And if you miss a payment, you could be on the hook for late fees.
  • You’re starting your life together in debt. When it comes to marital stressors, finances are often at the top of the list. If you and your partner take out a wedding loan, you’ll be starting your life together in debt, which can cause additional stress.
  • Your budget will be affected. Unless you pay off your wedding loan ahead of schedule, the monthly payment could affect your budget for years. Wedding loan payments may take away from other shared goals you and your new spouse have, such as saving for the down payment on a new home or contributing to your retirement funds.

Alternatives to wedding loans

Before you take out a wedding loan, consider some other ways to pay for your special day.

Credit cards 

Using a credit card can be a good option to pay for a wedding — as long as it’s the right credit card.

Many credit card issuers offer 0% APR on purchases for a certain time period. If you can pay off your full balance before the promotional period ends, you’ll avoid paying interest. But if you don’t pay the balance when the promotional period ends, you’ll start accruing interest at the card’s regular rate. And, you generally need good to excellent credit to qualify for a 0% card.

If you use a rewards credit card, you may even earn points, cash back or miles on those big wedding or honeymoon purchases. But it’s important to note that many wedding vendors charge credit card processing fees, typically between 2% and 3%, which may negate any savings or rewards you earn. 

Plan a modest wedding 

Just because the average wedding costs tens of thousands of dollars doesn’t mean that yours has to cost the same. 

Get creative and find ways to cut costs to make your big day more affordable. 

  • Look for a free venue in your area to have your ceremony, such as a park or even a family member’s home.
  • Make handmade favors or buy a dress through a trunk sale.
  • Consider inviting fewer guests.

It can be tempting to get wrapped up in the magic of wedding planning, but that often leads to overspending. Think about what’s really important to you and your partner, and where you’re willing to concede.

High-yield savings account and longer engagement

As eager as you may be to get married, consider having a longer engagement while also putting money aside in a high-yield savings account or other savings vehicle to cover wedding expenses without taking on debt.

A longer engagement will allow you to earn more interest on your savings. You’ll also have more time to interview caterers, photographers, and other vendors, find bargains and even reconsider your wedding day priorities. 

Tips to save for your wedding

  1. Automate the process. The best way to meet any savings goal is to set yourself up for success. For many couples, this means automatically transferring money into savings each month, where it can grow and earn interest.
  2. Set a budget. Sit down and determine what you can realistically afford to spend on your wedding day. Consider what that means for your savings efforts today, as well as any potential monthly payments later on. Then, stick to that budget no matter what.
  3. Pick your priorities. Wedding planning is an excellent exercise in "needs versus wants." Spend some time alone and with your partner thinking about what you absolutely must have for your wedding day, and what would just be nice to have. You may find places to trim costs in the process.
  4. Take your time. The longer you save for a wedding, the more money you’ll be able to save and the more interest you can grow. A longer engagement also allows you to take advantage of off-season sales, find bargains and DIY some aspects of your big day.
  5. Shop around if you’re borrowing. Whether you plan to take out a wedding loan or use a credit card to cover wedding expenses, spend some time comparing your options.

If you decide to get a personal loan to help with wedding expenses, use Credible to compare personal loan rates in minutes.