Poll finds young Americans refuse to spend too much on engagement rings – The Fool Motley

It's no secret that getting married is expensive. And a lot of the cost comes from the engagement ring that starts.

For years, the convention has been to spend three months salary on an engagement ring (or at least that's what advertisers would have us believe). But young Americans do not buy it. In fact, two-thirds of Y-generation young women and General Zers think that an engagement ring should cost less than $ 2,500, according to the results of a TD Ameritrade survey. That's less than half of the $ 5,680 that the average engagement ring costs nationwide.

If you are considering making a proposal in the near future, it is helpful to sit down with your loved one and synchronize what your engagement ring should cost – especially when you can do better with this money, as the following.

1. Pay for your wedding

The average cost of a wedding in the United States is $ 33,391, according to the wedding planning website The Knot. This is not necessarily what your the wedding will cost. But if you want to succeed in the big event without racking up a ton of debt, you'd better spend less on an engagement ring and put more aside for your wedding.

Starting a marriage with a stack of credit card bills is a good way to create a world of stress for you and your new wife. It could also damage your finances, making it more difficult to achieve your other common goals. That's why buying a less expensive engagement ring could prove to be very profitable in the long run.

2. Build emergency savings

Most Americans are very short on emergency savings. If you do not have a lot of money in the bank, what you could spend on an engagement ring could instead be used to build that safety net. Ideally, your emergency fund should contain enough money to cover three to six months of essential living expenses – such as rent, transportation, utilities, food and health care. So, if you lose your job or if you are hit by an unexpected repair of your home or car, you will not have to go into debt.

3. Save for a down payment at home

Although marriage and homeownership do not always go hand in hand, many new couples seek to buy as soon as they are able to combine their resources and afford a mortgage more easily. If this is your goal, then the money you will save do not Buying an expensive wedding ring could be used to pay a down payment. It's great to put 20% (or more) less on a home because it allows you to avoid private mortgage insurance, making home ownership more affordable.

4. Reduce your student debt

Many graduates of higher education abandon their studies with mountains of debt and then wear them until the age of 30 or 40 years. Rather than investing money in an engagement ring, use some of that money to reduce your student loan balance. In this way, you will save money on interest and avoid this burden sooner.

It's good to want to get your beloved the most beautiful engagement ring that money can buy. But the practical side of yourself should understand that spending more money for a single piece of jewelery just is not worth it, especially when you can do more important things with that money. The less you weigh heavily on your budget for an engagement ring, the less your wedding will be solicited.