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Wedding Budget: Step Two

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Wedding Budget: Step Two

In my first post about preparing your wedding budget, I talked about figuring out who is paying for what. This time I’ll talk about how both the couple and any contributing parents can avoid going into debt.

Going into debt for your wedding or honeymoon (or allowing those who love you to do so) is one of the biggest mistakes you can make. For starters, it means you’re spending too much money for a one-day event. Secondly, it sets a poor precedence for your marriage. It also means you’re borrowing from your future or the future of your family.

One of the first things you can do to avoid going into debt is setting up a budget. You can do one with papers and a folder if that’s your preference, or you can use one online. Here are a few websites with great budgeting tools:

Next, you (not mom and dad) need to prioritize the most important things about your wedding and honeymoon. Make a list of internal and external categories, then both of you order them by importance. Here are a couple short examples (10 or so is ideal), starting with internal priorities:

Internal He said She said
Positive Honeymoon Experience 2 3
Memories of Ceremony 3 1
Spiritual Significance 1 2
Pleasing Extended Family 4 5
Feelings of Romance 5 4

 

And external priorities:

External He said She said
Wedding Dress 3 2
Flowers 5 4
Photos 1 1
Reception 2 3
Rehearsal Dinner 4 5

Combine the lists by adding the numbers and you’ll get a good idea for your collective budget priorities. Make a commitment to go as far as you can down the list, but no further. After all, you need to plan around the idea that marriage is not just a day. I’ll talk more about that in my next wedding post.

Ellie Kay

America’s Family Financial Expert (R)

Wedding Budget: Step One

BGadmin

Wedding Budget: Step One

“They say when you marry in June, you’re a bride all your life.” That’s a line from a song in one of our favorite musicals, “Seven Brides for Seven Brothers.” It’s also a good reminder that when you prepare for your wedding, you need to think about details beyond the big day. In the Kay family, we have two Kay weddings in a two month time period. Since we’re in wedding season, I’ll use the next couple weeks to cover a few wedding preparation topics. Today’s post is about the budget.

An old proverb says, “A wise man counts the cost before he builds a tower.” One of the main mistakes engaged couples make is not setting a wedding budget, or expecting parents to cover expenses beyond their ability to pay. So how do you figure out who’s paying for what? You have to ask the right questions so you can gather all your financial facts.

What are the financial expectations from the bride’s parents?

The biggest mistake you can make here is assuming the bride’s parents will be covering all the expenses. All parents have some form of financial limitation, so it’s important to talk to them about it ahead of time. Some may give a lump sum; some may pay for specific things like the dress and/or reception. It’s usually best to be direct, polite and flexible when gathering information from the parents who traditionally pay for the majority of the expenses.

What are the financial expectations from the groom’s parents?

Tradition says that the groom’s parents are only expected to pay for the rehearsal dinner, but sometimes they may be able to cover more (or all) of the wedding costs. Talking to them about their financial limitations will both help your budget and encourage them to contribute willingly.

Are there any others who can contribute financially?

Sometimes grandparents or other relatives will offer to pay for part of the honeymoon or something else as their wedding gift. While you probably shouldn’t approach them about contributing, it’s a good idea to keep a list of who has offered to pay for what.

What expenses will the bride and groom cover?

It’s not uncommon for the bride and groom to pay for the entire wedding, especially if they are getting married later in life. But if they aren’t, it’s important to think about things the bride and groom are expected to cover, like the honeymoon, marriage license, flowers and the ceremony officiant’s fee.

It may be hard to ask some of these questions, but it will be harder if you’ve already gotten the financial ball rolling or if you’ve waited until the last minute. Setting an appropriate budget will help you avoid going into debt, which is what I’ll talk about in my next wedding post.

Ellie Kay

America’s Family Financial Expert (R)

Wedding Budgets – Step 4

Wedding Budgets: Step Four

 

If you’ve been keeping up with my posts the past couple weeks, you should have a good idea about financially planning for your wedding. I’ve covered approaching family members for contributions, prioritizing your budget and planning for a lifetime (not just a day). But weddings aren’t just about the ceremony, right? There’s the honeymoon! It’s important to plan how you can get the most out of your marriage’s first vacation.

After all, if you’re paying too much, the honeymoon can be over before it even begins. The first step is to do your research, so here are some tips and a few of my favorite sites for some of the biggest financial commitments associated with the honeymoon:

Airfare

This used to be the biggest honeymoon expense, by far. But rates have been going down recently thanks to an upswing in the economy, more efficient seating in planes and lower costs in fuel. You’ll want to check multiple sites to ensure you find the best deal. Here are some of the best airfare resources:

After you find the best rate, be sure to go to the specific airline’s website to see if they’re offering a better rate. Or, you can always call the airline and talk your way into some extra savings.

Lodging

You don’t have to fit yourself and your new spouse into a room the size of a closet during your honeymoon. Hotels can be super-affordable if you put in the work (especially when packaged with your airfare). Sign up for e-mail alerts, compare different sites and use reward points if possible. Here are some good starting points:

Like airfare, follow up after you find the best rate. It’s easier to save this way with hotels, as they want to fill up empty rooms, so try it out!

Dining/Entertainment

Companies usually like to package entertainment or restaurant add-ons with hotel or airfare reservations. While convenient, the prices are usually inflated and it’s better to book them separately. Use their suggestions as a starting point, but go to the entertainment company or restaurant’s site to see if there are any specials. Or, use sites like these:

Entertainment and restaurants can also be super-cheap or free. Some great things to do during your honeymoon can include games, sports, exercise, a visit to the library or a museum and even camping. And wherever you go, if you shop at a local grocery store, you can find unique items to enjoy at the hotel or on a picnic.

After 25 years of marriage, I can honestly say that planning for more than a day in planning for a lifetime really works!

Ellie Kay

America’s Family Financial Expert (R)

 

Wedding Budgets – Step 3

 

Ask my son Daniel about what he remembers from his wedding and he’ll likely give you a blank stare. “Uh… it was a blur. Everything happened so fast.” Ask our lovely daughter-in-law Jenn, and she’ll give you a slightly more informative response.  “ I remember the flowers and the pretty chapel and the look on Daniel’s face when I walked down the aisle…” Seriously, though, the wedding day goes by extremely fast for most brides and grooms, so it’s important to plan for the rest of your married lives, not just for one day.

To maximize your wedding without borrowing from your future, you’ll need a budget you can stick to, as I talked about in my last post. This will both minimize the financial stress of planning the wedding and help minimize the overall stress in your marriage by not having to incur more debt. But that doesn’t mean you have to turn your reception into a potluck dinner. You can have your wedding cake, and eat it too!

Here are a few ways to better prepare for life beyond the big day:

  • Plan ahead: The sooner you sit down and plan your budget, the better off you’ll be financially. I already mentioned online budget tools, but there are also a number of sites that let you figure out your schedule and other planning necessities. With a little organization, you can easily be your own wedding planner, which is an immediate savings in itself. Make sure you check out TheKnot and Wedding Wire and of course Pintrist!
  • Find the right ring/dress for you: You know that saying where rings should cost at least a two months’ salary? It’s basically an ad created by salespeople. Diamonds are forever, but you don’t want to be paying off your ring forever. Find one that speaks to you, but only if you can afford it. The same goes for the dress/tux you’ll be wearing exactly one day out of your life, as well as other expensive items. Some sites to help review the kind of dress you want are: Style Me Pretty  , Brides.com,  or The Stylish Dresser
  • Don’t go overboard on the venue: Daniel and Jenn got married in The Rose Chapel near downtown Fort Worth. It was gorgeous, but ended up being one of the most affordable options they found. The cost for venue arrangements can range anywhere from $0 to $10,000, so it’s important to research the best spot for you and your fiancé, whether it’s a hotel, club, restaurant, church, university or rental hall.
  • Invite a safe number of guests: For budgeting purposes, you can safely assume that about 60 to 70 percent of your invited guests will attend the wedding and reception. A good way to manage your invitations is by creating a “must-have” A-list of guests and a “would-like-to-include” B-list. Choose carefully, because there are always a few add-on costs.
  • Save on the reception: The reception is one of the easiest places to cut wedding costs. Fancy finger foods or hor’doeuvres are great (depending on the time of the day). But you can also cut costs in little areas , such as using an iPod instead of a DJ, buying half the napkins inscribed, half plain and using affordable yet attractive decorations like rose petals.  You might try carats and cake   or Lover.ly to find the extras in your neighborhood that others liked.

Basically, just try to remember that “happily ever after” is the reason you got married – not so you could blow your life savings on a one-day extravaganza. Or one big trip like the honeymoon, which is what I’ll talk about in my next (and final) wedding preparation.

Ellie Kay

America’s Family Financial Expert (R)

Wedding Budgets – Step 2


Wedding Budget: Step Two

In my first post about preparing your wedding budget, I talked about figuring out who is paying for what. This time I’ll talk about how both the couple and any contributing parents can avoid going into debt.

Going into debt for your wedding or honeymoon (or allowing those who love you to do so) is one of the biggest mistakes you can make. For starters, it means you’re spending too much money for a one-day event. Secondly, it sets a poor precedence for your marriage. It also means you’re borrowing from your future or the future of your family.

One of the first things you can do to avoid going into debt is setting up a budget. You can do one with papers and a folder if that’s your preference, or you can use one online. Here are a few websites with great budgeting tools:

Next, you (not mom and dad) need to prioritize the most important things about your wedding and honeymoon. Make a list of internal and external categories, then both of you order them by importance. Here are a couple short examples (10 or so is ideal), starting with internal priorities:

Internal He said She said
Positive Honeymoon Experience 2 3
Memories of Ceremony 3 1
Spiritual Significance 1 2
Pleasing Extended Family 4 5
Feelings of Romance 5 4

 

And external priorities:

External He said She said
Wedding Dress 3 2
Flowers 5 4
Photos 1 1
Reception 2 3
Rehearsal Dinner 4 5

Combine the lists by adding the numbers and you’ll get a good idea for your collective budget priorities. Make a commitment to go as far as you can down the list, but no further. After all, you need to plan around the idea that marriage is not just a day. I’ll talk more about that in my next wedding post.

Ellie Kay

America’s Family Financial Expert (R)  

Wedding Budgets – Step 1

Wedding Budget: Step One

“They say when you marry in June, you’re a bride all your life.” That’s a line from a song in one of our favorite musicals, “Seven Brides for Seven Brothers.” It’s also a good reminder that when you prepare for your wedding, you need to think about details beyond the big day. Since we’re coming up on June, I’ll use the next couple weeks to cover a few wedding preparation topics. Today’s post is about the budget.

An old proverb says, “A wise man counts the cost before he builds a tower.” One of the main mistakes engaged couples make is not setting a wedding budget, or expecting parents to cover expenses beyond their ability to pay. So how do you figure out who’s paying for what? You have to ask the right questions so you can gather all your financial facts.

What are the financial expectations from the bride’s parents?

The biggest mistake you can make here is assuming the bride’s parents will be covering all the expenses. All parents have some form of financial limitation, so it’s important to talk to them about it ahead of time. Some may give a lump sum; some may pay for specific things like the dress and/or reception. It’s usually best to be direct, polite and flexible when gathering information from the parents who traditionally pay for the majority of the expenses.

What are the financial expectations from the groom’s parents?

Tradition says that the groom’s parents are only expected to pay for the rehearsal dinner, but sometimes they may be able to cover more (or all) of the wedding costs. Talking to them about their financial limitations will both help your budget and encourage them to contribute willingly.

Are there any others who can contribute financially?

Sometimes grandparents or other relatives will offer to pay for part of the honeymoon or something else as their wedding gift. While you probably shouldn’t approach them about contributing, it’s a good idea to keep a list of who has offered to pay for what.

What expenses will the bride and groom cover?

It’s not uncommon for the bride and groom to pay for the entire wedding, especially if they are getting married later in life. But if they aren’t, it’s important to think about things the bride and groom are expected to cover, like the honeymoon, marriage license, flowers and the ceremony officiant’s fee.

It may be hard to ask some of these questions, but it will be harder if you’ve already gotten the financial ball rolling or if you’ve waited until the last minute. Setting an appropriate budget will help you avoid going into debt, which is what I’ll talk about in my next wedding post.

Ellie Kay

America’s Family Financial Expert (R)

 

 

Til Debt Do Us Part — Money Matters Before You Marry

This week is our anniversary and we are celebrating

by going away to the OC, riding segways on the beach & watching a concert called “Rain” (a Beatles Tribute). Hotel is free, segways are 1/2 price and Rain was 45% off!

When I married my husband, Bob, he was a young fighter pilot in the Air Force and I was a insurance/financial broker from Texas. We merged two different professions and two very different philosophies about money. Bob has a lassie faire style, a free spender who lives in the present. I am a structured person, a compulsive saver and always plan for the future. Even though it may seem that this marriage was made in any place but heaven, it has turned out quite the opposite. We’ve been happily merged and married for 24 years with seven children to show for it!

There were, however, a few things we learned after marriage that we wish we knew before the big date.

Talk, Talk, Talk,Communication is the key to dealing with money in marriage. According to a 2008 study conducted by California State University, 21% of couples fight over money daily or weekly. 10% fight monthly and 46% put on the gloves every few months. It’s no wonder that “money arguments” are cited as the number one cause for divorce in America. [[https://www.usaa.com/inet/pages/advice_merging_money]]

If couples spent as much time discussing this critical merger as they do in planning the honeymoon, they would have a great start in their new lives together. That is why it is critical for couples to get premarital counseling that specifically deals with money matters. Each partner comes to a marriage with different money management styles. Consequently, I recommend couples set aside date nights weekly to regularly talk about financial progress. Partners who discuss their views of money and work together to use their financial resources effectively may discover that they actually like the process.

Check, Check, Check, Some experts recommend running credit checks on their spouse-to-be. After all, “‘till death do us part” is the saying, and that means accepting everything about the other person, including any bad debt. On the other hand, if you don’t know how much money your fiancée owes, then the saying could be rephrased to: “‘til debt do us part.” Credit histories should be voluntarily shared among fiancées, preferably in front of a counselor. But you should never run a credit check on your future mate without their permission.

I like to say that “my love is unconditional, but my money is conditional.” It’s important to know about debt before the big date as the mingling of money could have an impact on your credit score. Initially, each score will be different, but if you are added to a spouse’s credit card or vice-versa, then that will have an impact for good or for bad. The merging of all financial resources means that in many cases—for mortgages, home improvement debt, car loans and joint accounts—his credit becomes your credit.

Usually, the bad score will more quickly impact the good score when joint credit is secured. However, it depends on how previous debt and accounts are handled. I do not recommend putting the person with good credit into the debt history of the partner with bad credit by adding her name to his accounts—this deteriorates the good payer’s FICO. But when it comes to future loans, there is a measure of unavoidable mingling. As a personal example, when we moved to CA and had to hook up electricity, with his FICO score the electric company required a $500 deposit. But by using my score we were allowed to establish service with no deposit. We put the bill in my name and in this particular case, it didn’t deteriorate my FICO and it saved us $500!

Yours, Mine and OursWhen two people merge finances, they will need to set up savings, checking and even retirement accounts. It’s important to decide if you will have joint or individual accounts.

There is no right or wrong answer on this one—it all depends upon what the couple mutually agrees to and what works for them. But it is something that should be decided ahead of time. If there are separate accounts, there needs to be full disclosure and accountability for those accounts. I’ve had the unfortunate experience of counseling many couples where one spouse racked up thousands of dollars in consumer debt and the other partner knew nothing about it until it was too late.

However, I’m a firm believer in keeping “mad money” and “surprise money” separate. After all, if Bob wants to give me a surprise trip to Paris for our anniversary—who am I to rob him of that pleasure?

A primary exception to joint accounts is any home based business account or trust funds that were established for children from a previous marriage. Those should definitely be kept separate at all times from a couple’s joint account.

Ellie Kay

America’s Family Financial Expert (R)

Bail Your Kids Out of Debt? Marry a Slacker? Co-Sign A Loan? – Ellie Kay’s Q&A

Ellie was on ABC NEWS, and others stations across the country again this past week. All the following people who asked questions will get a free copy of The Little Book of Big Savings!

Here’s her answers to your questions:

Q. Our son is only 20 and has $4,000 in credit card debt. He’s not able to pay and wants us to bail him out. I warned him about his credit cards because I made the same mistake when I was in my 20s and he didn’t listen to me. But I feel like a bad parent if I don’t help him out. What do you recommend?

Tim from New Mexico
Submitted via Facebook
ELLIE: Sorry to hear about your son’s decisions, Tim. NO, you should NOT bail him out. It sets a precedence and you’ll have to do it again (or do it for other kids, friends or family members). You can come alongside him and help develop a recovery plan. Or, offer to go with him to a free financial counsling center. Go to my free tools and click onto the section about consumer debt for more help. Your love for your son is unconditional, but your money is conditional. He made his own choices, now he has to deal with the consequences. You’ll support him emotionally, but you won’t fund his mistakes.

Q. Our daughter has a used car that we bought her when she was 18. She’s now 22 and newly graduated with a $30,000 a year job. She has to pay rent, insurance and all her living expenses and wants to buy another car. The one she has now runs just fine, but since she got a new job she wants a new car. However, we would have to cosign on it, what do you think?

Christine Thomason, Minneapolis
Submitted via Facebook
ELLIE: Congrats, Christine! You raised a baby girl who not only graduated from college, but also found a good job right away–well done! Now, the next step is to help her learn delayed gratification. She WANTS a new car, she doesn’t need one. The fact that she needs a co-signer indicates the bank does not consider her a credit worthy risk–neither should you. Instead, encourage her to set aside $350 to $500 per month (whatever her car payment would be) for a year. Then, she can sell her existing car, buy another nice USED car and pay cash. If she saves this way for another year, she can sell the 2nd car for a nicer used car (using her saved cash) and still pay cash. This way, she’s driving her “dream car” for free with NO car payments!
Q. We have two kids that are 14 and 16 and are on competitive basketball teams. They take a bus two to three times a week to tournaments and other competitions. We have to pay for their meals on the road and they are burning through our cash constantly. They’ll spend $15 or more (each) for a fast food meal and we’re going broke. Is there a way to motivate them to cut back on how much they spend?

Thomas Evers, New York
Submitted via email
ELLIE: Thomas you’ve found yourself in the place where you are getting played by your kids. I know what it’s like, I’ve found myself asking: “How did I get here?” when it comes to my teens running over me with their personal agendas. It’s time to regain your lost ground and be the dad. Tell your kids that you are putting them on a food budget and they will now have $10 (each) to spend on fast food. If they were eating in a nice, sit down restaurant, it would be different. But they’re not. Tell them if $10 is not enough, they can bring a sack lunch on road trips or pay the extra expense with their own money. Either way, they’re not going to starve and you won’t go broke.
Q. Our oldest daughter is suppose to get married in December. She is 24 with a good job and her fiancée is 30, has a degree in electrical engineering but doesn’t really have a job. He drives a truck off and on. It’s spooky, because when I got married, it was a similar situation and we ended up divorcing because I was the main breadwinner and he couldn’t hold a job. I don’t want her to make the same mistake. Do you think a couple has a “right” to know about each other’s finances and attitude toward money and work before they get married?
Donna Michaels from Oklahoma City,
Submitted via blog

ELLIE: History has a way of repeating itself. There are so many red flags in this situation, that you are right to be concerned as a mom. First of all, your daughter needs to go to premarital counseling with her fiancee and stress with the counselor that they want an emphasis on financial issues. If her fiancee will not go, then I think she should postpone the wedding. A couple of facts are clear: he is well educated and underemployed. The reason might be something legitimate like “the economy” and counseling will make that clear. But the other reason could be that he’s unmotivated when it comes to providing a living–in other words, he could be a slacker. So if your daughter wants to be the main breadwinner and face a life of living with a man who is underemployed, then keep the December wedding date. Otherwise, get the wisdom of a third party involved to determine the real reasons for his unemployment.
Please submit your questions and if I answer them in a blog, I’ll send you a free copy of The Little Book of Big Savings!
Ellie Kay
America’s Family Financial Expert (R)

The Honeymooners – How to Have a Debt Free Wedding


One of the most invisible women at a wedding is the mother of the groom. I found that being invisible was actually a lot of fun because my son was marrying the right little lady at the right time and in the right way! All eyes should be on the bride–and groom.

The bride wore white and the groom was in black–in the black, to be precise. Our oldest son, Daniel, graduated from college debt free last month with a great FICO score and no consumer debt. This past week he got married and once again, there was no debt associated with the ceremony, reception or honeymoon! In fact the only “red” that this new couple got into was their (paid for) red convertible. And it wasn’t because mommy and daddy took care of all the boy’s bills, it was because he learned about financial freedom and living within your means. Starting out well in life by paying cash may mean you wait on the things you want to get, but it also means that there’s twice the likelihood Daniel and his bride will not divorce since one in two couples cite “money issues” as the reason they separated.

I gave them The New Bride Guide when they got engaged over a year ago and they used it as their wedding planner. Thousands of other couples have done the same and here are just a few of the key tips to have the wedding of your dreams in the reality of today’s economy.

  • Live Your Plan – It’s important to evaluate how much you can spend by having careful and honest discussions with parents, grandparents or others who will contribute to the wedding. Don’t work your plan until you know how much you have to spend. I have a chapter that gives you the step by step guidelines for these discussions. Too many couples make their plans first then struggle with a way to pay for it later which usually means debt.
  • Bargaining – By incorporating five words (is this your best price?) you can save thousands of dollars on everything from invitations, dresses, flowers, photography, the rehearsal dinner and the honeymoon! Learn the fine art of bargaining.
  • Honeymoon Savings – Daniel followed the tips on vacations and got a rock bottom price on an incredible honeymoon trip to Ireland. They layered the savings online for other items they needed for the trip and saved as much as 50%.

You don’t have to be the son of a financial expert to learn how to have a tasteful debt free wedding. As I told Daniel, it’s not about planning a wedding, it’s about planning a marriage and starting a marriage debt free is the best gift you can give your bride.

Ellie Kay

America’s Family Financial Expert (R)

www.elliekay.com