I don’t get the feeling that our wedding was really for us. I think it was more for the family, and we were just pawns in the game. Of all the people who attended the wedding on my side, I had two fraternity brothers and my mother; the other hundred and some people were my wife’s family members and friends. Don’t get me wrong, we loved the honeymoon, but having a big wedding was a lot of stress and pressure; and while it was fun in some ways, the ceremony didn’t change the way we felt and continue to feel about one another.
While I don’t have exact figures, I’d say that our wedding costs probably came in somewhere around $30,000. Don’t get me wrong, I certainly appreciate what the in-laws did, but I think we — or my in-laws — would have been better served putting that money to work in other ways.
In the stock market
Just think if that $30,000 had been put to work in the stock market for the past five years. Let’s say our dear in-laws had saved this money for themselves and invested it, with an annual compound interest rate of 6 percent for 15 years, until their retirement. That amount would have grown to nearly $72,000 — a nice little monetary addition to their golden years.
But let’s say that we had been gifted that amount, and in turn invested it in the market, also with a 6 percent annual compounded interest rate for the 40 years until our own retirement. We would or could be looking at nearly $310,000. Talk about a tidy little nest egg!
How about bonds?
But I’m more of a low-risk type of investor. I prefer sure things. I’ve had savings bonds since I was a kid and at an annual average interest rate of 3.5 percent, this isn’t a bad return either. So what if we had taken that $30,000 and plowed it into government savings bonds at that rate?
Well, leaving them alone for 30 years (the maturity length of government savings bonds), at an estimated average 3.5 percent semi-annually compounded interest over time, we might have grown our initial investment to almost $85,000 as we neared retirement.
My fellow writer at Y!CN, Laura Quinn notes in her article, “First Person: We Bought a House With Our Wedding Savings” that, “We could have easily blown $36,000 on a wedding, but instead my husband and I used our wedding savings to buy our first home together.”
She goes on to note, “Our focus was not only on that one special day, but on the life that we wanted to live together after the wedding. My husband and I are both practical people. We pictured a life together in our new construction home that cost us about $183,000 in 2005. In order to afford the payments and avoid PMI (private mortgage insurance) we needed $36,000 as a down payment.”
I’m in agreement with Laura’s train of thought. Having that extra $30,000 to put toward a home would have increased our downpayment, cut interest on our loan over time, and stemmed some of our losses from the housing market collapse when we sold.
So before you go out and blow your wad on a big wedding, you might want to consider a few other options for that money to work.
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The author is not a licensed financial or relationship professional. The information provided in this article is for informational purposes only and does not constitute advice of any kind. Calculations have not been verified by a professional. Any action taken is solely at the reader’s discretion.