Tuesday, 28 October 2014
Posted by Rebeccah Elley
Here at Mozo we were intrigued when reading a story by the Barefoot Investor about a bride called Skye who announced “my wedding debt lasted longer than my marriage”, after spending somewhere between $20,000 and $40,000 on her Big Day. Surely, most weddings in Australia don’t reach near the $40k mark...or do they?
Stats from MoneySmart show the average Australian wedding costs an average of $36,200 - that’s an alarming number when you consider it could be used as a deposit for your first home.
So before you walk down the aisle and towards a hefty wedding bill, it’s important to have the money chat with your partner (we know it’s not the most romantic endeavour but it has to be done).
Here are the tough questions you should consider asking:
1. How are your finances sitting?
What happens when the Honeymoon tan begins to fade, the half eaten cake is stuffed in your freezer and you are hit with the reality of married life and lingering wedding debt? Finding out where your partner is at money wise (savings, credit card balance and personal loan repayments etc) means you can plan a wedding that suits your financial situation and avoid a post-wedding blowout.
2. Are our parents going to help out financially?
While traditionally the Father of the Bride paid the wedding bill, times they are a changin’ and you may have to reach into your piggy banks and then some. But that doesn’t mean your parents won’t help out at all, so once you’ve figured out how much (if any) they are going to chip in you can factor this into your wedding budget.
3. What is our wedding budget?
Whether you’re planning on jet-setting to Bali for a tropical destination wedding or simply hosting the nuptials in your home town, it’s important to sit down and organise a clear budget that you’re going to stick to before booking everything from the venue to the photographer. Use Mozo’s budget calculator to get a clear picture of your financial situation.
4. Should we open a joint bank account?
If combining your accounts seems a bit daunting, you could consider meeting half way by opening a joint savings account and keeping your everyday transaction accounts for spending while out and about. If you do decide to open a joint account, make sure it has a high interest rate attached by searching the savings account market.
5. Do we need a prenuptial agreement?
This question is definitely awkward but may be a serious consideration, especially if you have built up a significant amount of assets like property or investments. You can get a prenup drawn up by a lawyer, which will set out the treatment of possessions and future earnings.
And once you get those moneygamy questions out of the way you can start cracking on the wedding organisation.