Ding dong, the bells are ringing! Is it your wedding they’re chiming for? Congrats! If you’ve just started the research for your big day, then you’ve probably got a fair idea how much it’s all going to cost - a lot. Not everyone has a spare $50k lying around, so you might want to consider taking out a personal loan. Here’s hoping you’re sharing the costs with your partner of course! Can you go 50/50? Whatever the fraction, taking out a loan for two would be much easier to repay than taking out a loan on your own, especially if you’re just starting out as a couple.
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Wedding loan pros and cons
What’s that you say? You’re having a wedding?! How Lovely! Excuse me while I hike up the price by another 30%. You’ve probably noticed by now that the average prices for standard events have gone up considerably since you’ve mentioned the ‘W’ word. From venue hire, DJ hire, chandelier hire to invitation and cake-makers - everyone it seems wants a cut from your big day.
Well, seeing as you can’t mask this day as any other event, you’re going to have to grin an bear it. After all it’s the biggest day of your lifetime! It goes by so super quickly like a flash of lightening, so stay put and enjoy every tiny moment. What you should focus on right now is the best wedding loan features you can secure. Keep your eyes peeled! No point in staying loved-up and starry-eyed when signing a document that seals a small fortune away. Stay alert and check out the pros and cons of a wedding loan with us:
Advantages of a wedding loan
Much like a personal loan, rates are competitive between lenders and you’ll have the option to secure a fixed or variable rate, so take into consideration how long you can make repayments and if you require a strict budget to deal with your everyday expenses.
Remember, the shorter the loan the less you pay in the long run so if you can budget to pay more for each instalment, then you'll be on your second honeymoon in no time! Check out Mozo’s repayment calculator and see. You might even surprise yourself.
Disadvantages of a wedding loan
Don’t trip over the long list at your feet there. The biggest challenge is overcoming the price hike after mentioning that you’re preparing a wedding, and that may go for loan rates too, so watch out! Always look for a second opinion, in fact go for 3 or 4 quotes for everything.
You want value for money because weddings are not cheap! Even the smaller receptions can add up in no time. There are so many hidden extras to entice you for the bigger and better wedding...since you’re all loved-up and uber happy, you may be vulnerable to buying-in on the wedding extras. So having a more cash up your sleeve could be ideal if you want to flaunt it all. After all, it’s your big day! Go out with a bang.
Remember, your credit rating will play a part in what kind of interest rate you secure, or whether you qualify for a loan at all, so be certain to plan your application out a bit if you intend on borrowing a handsome sum. You’ll appreciate the spending freedom as opposed to scrimping on the event of your lifetime.
Features to look for in a wedding loan
When planning a wedding, it's difficult to keep the bright rainbows and pulsing love hearts from bursting out of our eyes and mouth. It’s ok, because getting gushy and mushy about spending the rest of your life with the partner of your dreams should be all about unicorns leaping and happy days ahead. So instead of getting distracted with your future conjugal bliss, you may want to knuckle down and focus on the most suitable wedding loans available.
Remember wedding loans are just like personal loans, just with a fancier title. The types of features you’ll want to look out for are things like: free extra repayments, low or no ongoing fees, fixed or variable rates. Here’s a quick run-down on what to cool features you should look out for:
- Unlimited extra repayments - Having this feature means you will be paying off your loan in no time. The more often you pay, the less you owe in the end.
- Low or no ongoing fees - Imagine for the life of your loan, no or little admin fees? This is a possibility. If you see a finance provider with a promotion at the time of your search, look into it - you could be saving a whole heap of fees.
- Fixed or variable rates - The difference between the two could be vast. But there’s no guarantee. This is because there’s really no telling how a variable rate will perform. There’s also no guarantee that the RBA cash rate savings will be passed on by your finance provider, leaving you in the lurch while they profit from you a while longer. With a fixed rate, you may be paying a little more in the long run but it means you can predict how much your repayments will be and sort out your weekly budget in advance.
Which lenders offer wedding loans?
Here in Australia you’ll be able to get a loan for a wedding from most major banks and credit unions. Generally you’ll apply for a standard personal loan, with you setting the loan amount and loan repayment term.
You can search which lenders offer loans quickly here on Mozo:
An alternative to a bank or credit union is a peer to peer lender. P2P platforms are a competitive option if you have a good credit rating as peer-to-peer players have tiered interest rates, meaning their most competitive rates are for more creditworthy borrowers. Their interest rates are often lower than banks or other lenders and you can generally pay off the loan early without penalty. See which peer to peer lenders are available in Australia or read our P2P guide for more information.
Wedding budgeting and repayment tips
From what to do with extra dollars to how you make repayments, we can give you a few helpful tips to get you started:
- Whether you’re moving in together for the first time or getting married after already living together for years and years, now's a good time to cull through your bits and bobs. Decluttering is perfect for turning a new leaf, and a good way to make some extra cash on the side. At the end of the day, if you put any extra income toward your loan, you will be actively reducing it. Now that's a great saving!
- Have you thought about making more regular repayment instead of the standard monthly installments? The more regular the repayment, the quicker you shave down the bulk of your loan - especially if you pay more than the minimum repayments.
- Confused about which direction you should be heading? We can’t tell you exactly how to start your search, but you’re here now, and this is certainly a good place to start! Try using Mozo’s personal loan search tool to see which lender and product will suit your budget most.
Wedding cash traps to avoid
If you accidentally find yourself getting caught in the wedding hype then it’s really okay - afterall this is a once in a life-time moment to shine. But if you want to play the wedding game in a clever way, you’ll do a lot more research to getting the best deals around. Saving money is the kind of game Mozo likes to play! Here is a brief checklist to peruse over regarding dodging a handful of wedding traps:
- Wedding mags offer great inspiration - but don’t get too caught up in the wedding fairytale, or you could be spending much more than you anticipated.
- Did you know that wedding invitations can cost upward of $10 per invite? If you’re already inviting 100 people at $100 per head, adding another $10 per invite is only going to escalate your expenses. Consider making your own to save on a bundle.
- You probably already know about the wedding photographer costs by now. If you’re mouth is still agape, you might want to consider buying a disposable camera for each table. You’ll be surprised how many fabulous candid photos will capture the essence of the night perfectly. And with nearly every person owning a smartphone, considering the pretty awesome resolution, your wedding guests could easily share an email of wonderful photos from your big day. The participation will amaze you, so will the quality of the images.
- Do you really need to spend thousands of dollars on a wedding dress? There are some beautiful off-the-shelf options available at a fraction of the price. Try up-market online stores and make sure they have a decent return policy in case it really doesn't suit you. Perhaps make an enquiry and make them aware that you're looking for the ideal wedding dress and ask if you can purchase a few to try and return what you don’t keep. Tip: Watch out for dresses on sale! Some sites won’t accept returns on sale items, and you don’t want to end up with more than one wedding dress on the day.
- Bridesmaid dresses and groomsmen are a lovely touch and symbolic to your meaningful day. But do they need custom-made outfits that cost sometimes a minimum $500 each? Consider buying an elegant cocktail dress or suit off the rack in a whole lot of sizes for your wedding party members. Thinking about dresses for a moment, if the one style of dress doesn't suit everyone, you may want to think about having a spray of colours in a few different styles. No one said you have to have a traditional wedding all the way!
For more wedding savings tips and ideas for ways to do more for less money, head on over to our wedding hub. Some of our most popular articles include:
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