There are plenty of so-called rules on how much to spend on an engagement ring. You might have heard the ‘two months salary rule’ for example. In reality it’s much better to make your own rule – based on 2 factors which we explain below.
This article includes:
- We myth-bust the ‘two months salary’ rule
- The REAL RULE based on 2 crucial factors
- How to calculate a realistic budget
- What women actually expect
- Payment options, with examples
- Insider tips to save money on diamonds
- Ring examples with prices
Myth-busted #1 – The two months salary rule
There’s a saying that you should spend “two months salary” on an engagement ring. This actually originates from a 1950’s advertising campaign by a major diamond company. It proves the power of advertising, since the idea has stuck.
However, it’s not a realistic financial option for everyone.
If you earn enough, you should of course go for it! But if you have lots of debt or no long-term job security, it makes sense to scale back the spending.
Myth-busted #2 – The national average rule
Recently a national newspaper reported the UK national average spend on engagement rings as £1,471. Then a finance website quoted the figure as £568. The same month, a women’s magazine estimated the amount to be “between £850 and £4,000”.
With such unreliable figures, who knows what the “national average” really is?
REAL RULE – This is what it should be
It’s simple. To know how much to spend on an engagement ring you should strike a perfect compromise between these 2 factors:
- Your fiancée’s dream ring
- Your financial reality
FACTOR 1 – Understanding what she expects
Some people argue that an engagement ring shouldn’t be that important, because if you love each other that’s all that matters. However, many women feel differently:
- Symbolism. To most women an engagement ring is a physical representation of your mutual love and commitment. It’s very, very important to her.
- Hopes and dreams. Many women imagine what their perfect ring might look like long before they get engaged. She could be very disappointed if the ring doesn’t match her expectations.
- Personal style. Your fiancée will wear the ring every day for the rest of her life so it needs to suits her taste.
- Peers. She wants something she feels proud showing to her friends.
- Family and tradition. Her mother and grandmother had beautiful engagement rings from her father and grandfather. She wants you to measure up.
The iPhone argument
Compare the price of an engagement ring with your gadgets. How much does your car, iPhone or other gadgets cost – and what is their lifespan? What are their price tags and how do they compare to an engagement ring that needs to last a lifetime of wear and tear? This is often a great way to put the price into perspective.
How do I know what she wants?
If you’re good with fashion and design, look at any existing jewellery she wears a lot and buy a ring that matches that style.
If you’re not good at picking out styles, you must ask for help. Her best friends or sisters are the best people to advise you, because they’re her peers and know what she likes. You can also read our engagement ring shopping advice article.
FACTOR 2 – Reviewing your financial situation
OK, finally, this bit is about you. Alongside her expectations, you do have to consider your current financial situation and your future.
There are no right or wrong answers. Simply answer each of these questions:
✔ What is your income?
✔ What are your expenses?
✔ Do you have any savings?
✔ Do you have any debts?
✔ What are your financial priorities before the ring?
Children, mortgage, wedding…
✔ Do you have enough saved up to pay for the ring outright?
Or will you need to finance some or all of it?
✔ If you need finance, how much can you realistically pay off each month?
And by when ?
Once you anwer these questions honestly, you’ll be in a better place to decide on a budget.
Methods of paying for an engagement ring
Read the examples below and decide which one represents you the best:
You have £2,000 in savings and you’re able to save around £250 per month.
You have a few options here…
(1) You may not want to put all your savings towards a ring. So let’s say you save for another 6 months. You could then pay outright for a £1,500 – £2,000 ring.
(2) Alternatively, you could put £1,000 – £1,500 (from your savings) on a down-payment on a £2,000 – £2,500 ring and pay for the rest with finance offered by a jewellery store. The more cash you can pay upfront, the better chance you have of getting finance. Plus if you pay it off quickly in just a few installments you may get an 0% interest deal which is ideal.
You have £500 in savings and you’re able to save around £50 per month.
Let’s say you set your sights on a ring for around £500-1,000. You could:
(1) save a further 6 months, and pay for the ring outright, or put it partially on jewellery store finance as explained above.
(2) If you don’t have the time to save up, or don’t want to pay a deposit, you could put the ring on a credit card. But be careful and try to find a credit card with low interest, so you’re not paying way more than the real value of the ring.
(3) You could borrow a little extra money from a family member. That means no interest and no credit checks. But be honest with yourself: are you good for the money? If you fail to pay your family member back, that relationship could be be ruined forever.
You’d love to get her an amazing ring but you just don’t have the money.
Your financial situation will ultimately dictate what you can spend. You may be paying off student loans, expecting a baby, want to buy a house or simply cannot afford an expensive ring on your salary right now. What you should do is buy as good a ring as possible on your budget. If you feel it’s too small or you’d love to get her something more expensive, consider surprising her later with an upgrade ring as a 5th or 10th anniversary gift.
Tips on how to save on an engagement ring
Our jeweller, who knows the diamond business inside out, recommends these pro tips for getting the best deal for your money:
- Try to shop during sales – Black Friday & January are the best.
- Know what you want before you enter a shop. Read a Diamond Buying Guide so you know what is a good deal and can negotiate.
- Shop online as online shops have lower overheads than high street stores and can often offer better prices.
- Go for an alternative gemstone like sapphire or ruby, instead of a diamond, so you’ll get a much bigger stone for your money.
- Understand how the diamond wholesale process works to be at a knowledge-advantage and get the best buy.
- Make the diamond ring look bigger with a halo, cluster, gem or illusion setting, if you’re on a small budget but she wants a big ring.
Examples of engagement rings WITH PRICES
Here are 5 of the most popular engagement ring designs:
Solitaire Rings – A single diamond on a precious metal band
Sidestone rings – with extra diamonds on the band to add luxury
Helpful final words
What you spend on an engagement ring is entirely up to you. It’s nobody else’s business.
You do have to make sure she is happy with the ring because it’s the most important piece of jewellery that she will ever wear – and she’ll be wearing it for life. This means you need to get the best ring for your budget… but use common sense. You don’t want to over-stretch your finances to a point where you’ll have to struggle during your first year of marriage.
In a nutshell, you should both feel truly happy with the ring, knowing that it represents the very best that you can buy for her.
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