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I got this question via email. I changed some details to keep it anonymous but was curious what advice you would have given.
Here was my reply but I'm curious what the community thinks on this one. On the one hand, I think weddings should be cash-flowed. On the other hand, these two are doing so well anyway, who cares what they do about the wedding?
I wanted to get your opinion on the best way to go about obtaining a loan for a wedding in the summer of 2016. My fiancee and I are both PGY1s in high-paying specialties and only have ~$90K in student loan debt between the two of us. We are currently saving $1000 per month each from our resident salaries. Her parents are not as financially prepared for a wedding we have planned (and we only plan on getting married once, so we both agree we would like to have it a certain way, aka $$$). Anyways, if we were to go about trying to obtain a loan to supplement the wedding payment, what would be the best way to go about this? Or is this an absolutely stupid idea? I can ask my parents for a "loan" but would really like to avoid this at all costs - just trying to get financially independent from them. Is there a certain loan or bank or company to look out for in a situation like this? I think we wouldn't have a problem to keep saving another $1000 each per month, and possibly could bump it up to about $1200 each a month. So if we were to take out a $20,000 loan and we could pay it back in a bit under a year, is this something that makes sense? What sort of interest rates should I be looking out for? And any big things to do/not do in a situation like this?
Here was my reply but I'm curious what the community thinks on this one. On the one hand, I think weddings should be cash-flowed. On the other hand, these two are doing so well anyway, who cares what they do about the wedding?
Well, I think it's dumb to borrow money for a wedding. I think it's even dumber to borrow $20K. I think it's especially dumb to do so given that the two of you make over $100K combined.
However, you guys have done so well with the larger financial items ($90K in student loans between two docs is almost unheard of these days) that you can probably do whatever you want with regards to this wedding and still be just fine in the long run. 5 years from now you could probably be saving $20K a month. That said, consider the following:
1) Look at each of your current savings. Use that first.
2) Your parents and her parents can likely contribute something. It might only be $1000 each, but it gives them the chance to contribute which is important.
3) You have time between now and the wedding to save up even more- $2000 a month is good, but come on. You guys make $100K a year. You can easily double your savings if this wedding is really important to you. You still have $50K/year to live off of. If you push the wedding back 3-6 months, you can probably cash flow the whole thing yourselves.
4) If you do decide to borrow part of the cost, why not just get a 0% credit card offer for 12-15 months and put the wedding expenses on that?
5) Don't feel badly about cutting back on some of the expenses. We spent far less on our wedding (although we had far less income than you) and still have a wonderful marriage. Spending more doesn't necessarily make the experience any more special. In the end, it's about the commitments, not the booze, food, and facility. Lots of people get married every day for far less than $20K.
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