Weddings have become so expensive that many couples are opting to take out loans in order to finance their nuptials. Interested in learning more? Read on (no more puns, we promise).
We know how hard couples have to work to stretch their wedding budget, which is why we try to make it as easy as possible to rent or buy a tux for the big day. But of course, sometimes your budget is stretched too thin, and you have to start looking at other options.
For many couples, that means taking out a loan. With average wedding costs rising to a national average of over $44,105 in 2018, it’s no surprise that more and more couples are taking out loans to fund their weddings. In fact, according to Student Loan Hero, 74% of couples will take on debt to get married.
Since the average cost of tying the knot varies greatly depending on location, we decided to calculate the amount of interest you’d accrue if you took out a loan to cover the average wedding cost in each state. We broke it down by principles of 100%, 50%, 25%, and 10% of each state’s average wedding costs, and uploading all of our data to an interactive table at the end of this post. Check out our findings below.
Table of Contents
i. Methodology
ii. The Cost of Taking out a Loan to Fund 100% of Your State’s Average Wedding
iii. The Cost of Taking out a Loan to Fund a Percentage of Your State’s Average Wedding
iv. The Cost of Taking Out a Loan to Fund Your Wedding in Every State (Interactive Table)
v. Wrap Up
i. Methodology
We pulled the 2018 average wedding cost for each state from The Wedding Report Inc. as reported by USA Today. From there, we calculated the amount of interest that would accrue over time if a couple were to take out a personal loan to cover 10%, 25%, 50% or the entire cost of their wedding. We also calculated the monthly payment associated with each loan scenario. To calculate the terms of the loan, we found the average credit score in the United States, 704 according to FICO, and the median APR for a personal loan given to that credit score, 14.5% according to Value Penguin. Based on these numbers, we calculated the interest associated with a repayment period of three years.
ii. The Cost of Taking out a Loan to Fund 100% of Your State’s Average Wedding
We’re not ones to tell you what to do with your money, but these figures are important to take into account when deciding whether or not you’re going to finance your big day. How much are you really spending to add that mashed potato bar or photo booth to your plan?
According to our calculations, if you took out a loan to fund 100% of your wedding in Alaska, New York, New Hampshire, and New Jersey, you would pay over $8,000 in interest in just a three year period. The highest interest you’d pay is if you had your wedding in Hawaii, a total of $9,345.71.
Alternatively, if you took out a similar loan to fund 100% of your wedding in states such as Alabama, Arkansas, South Carolina, and Kentucky, you would pay nearly half of that in interest, close to $4,000.
iii. The Cost of Taking out a Loan to Fund a Percentage of Your State’s Average Wedding
We realize that most couples will not seek to finance their entire wedding, but rather a percentage of it. We were surprised to see that even when financing 50% of your wedding, you will pay at least $1,800 in interest over a three year period. On the West Coast, you will pay an average of $3,587.49 in interest, and in the Northeast, you will pay an average of $4,019.36.
It’s important to consider the implications on your budget for years to come, not just leading up to the wedding, should you and your partner make this financial decision. These interest costs, especially when paid over a short time, can significantly add to the cost of a wedding when considered in total. For example, if you were to take a loan out for your wedding in California, your monthly payment for this loan would be $563.90. You can view the rest of the monthly payments for each of these loans here.
What if you only financed 25% of the cost of your total wedding cost? Perhaps this is a more feasible option for couples looking for a little support to bolster their budget.
Again, the principles of these loans are derived from the average cost of a wedding in each state—the actual amount a couple might end up paying could vary greatly depending on their wedding budget. The total interest you would pay ranges from $931.57 in Mississippi to $2,336.43 in Hawaii over a three year period. Monthly payments for these loans range from about $150 to $340.
Of course, there is always the option to take out a small personal loan to help cover the cost of your wedding. For the average wedding cost in every state, loans covering 10% of the total wedding cost would have an average principle of about $2,500.
When repaying this loan over a three year period, the total interest you’ll pay won’t exceed $1,000, ranging from $934.57 in Hawaii to $372.63 in Mississippi.
iv. The Cost of Taking Out a Loan to Fund Your Wedding in Every State (Interactive Table)
This finance talk can be a lot of information to take in. That’s why we organized all of our data into the table below. Click on any of the column headers to filter all of the data by that category, and get informed about financing your wedding.
v. Wrap Up
Choosing to finance your wedding is a huge decision to make—one that shouldn’t be taken lightly. Whether you’re aiming to keep your wedding costs as low as possible, add a bit to your repertoire, or help out a family member seeking to get hitched, there are plenty of reasons to take out a loan to fund a wedding, or to choose not to.
Whatever wedding finance plan you decide to move forward with, remember that your love and your relationship is completely unique to you, and doesn’t have a price tag. We love the idea of our customers and readers making informed decisions regarding the biggest event of their lives. For financial advice, we recommend seeking out a trusted professional who can analyze you and your partner’s situation and help you determine the best path to wedded finance bliss.