If you got engaged this Valentine’s Day, you might want to double check that you haven’t just endangered your credit history.
Getting married is an expensive business – but you can always just have a long engagement while you save up the money, right?
Well according to credit reference agency Experian, many couples might be facing a more immediate threat to their financial stability: the cost of the ring.
‘Traditionally’ (in a tradition created by diamond traders De Beers), the man is ‘supposed’ to pay three months’ salary for the ring, although Experian found that fewer than one in six people actually do.
But British fiances are still stretching their finances to get her the sparkler she always dreamed of, with the average ring costing nearly £750, one in four costing more than £1,000, and one in ten costing over £2,000.
How are we paying for all of this bling? Largely with credit:
- 37% pay for some or all of the cost in cash;
- 23% fall back on their savings;
- 15% use a credit card;
- 12% use a store card;
- 4% use a loan.
On average, it takes five months to repay the borrowing, but 9% take longer than nine months, and 3% take over a year.
Peter Turner, managing director at Experian Consumer Services UK & Ireland, says: “Spreading the cost of an engagement ring over several months can help ease the pressure a proposal puts on the purse strings.
“But fiances and fiancees should give serious consideration to affordability and their long-term plans when considering how much to invest in their engagement ring and how they plan on financing it.”