How Wedding Plans Affect Your Financial Plan
Your children's weddings can be an exciting part of being in your 40s or 50s, but they can also be a financial challenge. You may be just finishing paying for college tuition, and the added cost of a wedding could strain your current finances and your future planning. On the other hand, you may be excited about the chance to help pay for a huge celebration. It's important to think about how your financial contribution to your child's wedding helps or hinders her future financial security — and your own.
Establish Expectations Early
Try not to imply to your kids that your contribution to their wedding costs is going to be different than what you can really afford. In many cases, the best approach is to offer a fixed dollar contribution to the budget, and then to step back and let the kids plan the event themselves. By doing this — and sticking to it — you avoid the surprise of a bigger expense than you can afford and the kids can plan their budget around the resources they know they have. Remember, your own financial security is more important than impressing the neighbors with a big wedding — be realistic about what you can give.
Consider giving your kids the choice of using your gift to pay for their wedding or to add to their investments or build a down payment on a house — or a combination. Generations have different value systems; you might be surprised by how highly they value the investment or down payment instead of the wedding.
Encourage your kids to manage costs by prioritizing their goals for the event. Suggest that the bride and groom start their plan by listing their priorities on individual sticky notes. Then have them work together to arrange the notes in order of priority. For example, one of them may prioritize a small venue for the ceremony and the other may prioritize the honeymoon trip. Once the priorities are listed, assign a dollar figure to each. This will start as an estimate that can be refined with additional research. Finally, check the financial resources and fill out the budget, from the top priority down. This guarantees that the important issues are accounted for and you've minimized the focus on the details that are less important to the couple.